Carbon offsets from voluntary avoided-deforestation projects are generated on the basis of performance in relation to ex ante deforestation baselines. We examined the effects of 26 such project sites in six countries on three continents using synthetic control methods for causal inference. We found that most projects have not significantly reduced deforestation. For projects that did, reductions were substantially lower than claimed. This reflects differences between the project ex ante baselines and ex post counterfactuals according to observed deforestation in control areas. Methodologies used to construct deforestation baselines for carbon offset interventions need urgent revisions to correctly attribute reduced deforestation to the projects, thus maintaining both incentives for forest conservation and the integrity of global carbon accounting.

Reducing emissions from deforestation and forest degradation (REDD+) has gained international attention over the past decade, as manifested in both United Nations policy discussions and hundreds of voluntary projects launched to earn carbon-offset credits. There are ongoing discussions about whether and how projects should be integrated into national climate change mitigation efforts under the Paris Agreement. One consideration is whether these projects have generated additional impacts over and above national policies and other measures. To help inform these discussions, we compare the crediting baselines established ex-ante by voluntary REDD+ projects in the Brazilian Amazon to counterfactuals constructed ex-post based on the quasi-experimental synthetic control method. We find that the crediting baselines assume consistently higher deforestation than counterfactual forest loss in synthetic control sites. This gap is partially due to decreased deforestation in the Brazilian Amazon during the early implementation phase of the REDD+ projects considered here. This suggests that forest carbon finance must strike a balance between controlling conservation investment risk and ensuring the environmental integrity of carbon emission offsets. Relatedly, our results point to the need to better align project- and national-level carbon accounting.

Carbon markets play an important role in firms’ and governments’ climate strategies. Carbon crediting mechanisms allow project developers to earn carbon credits through mitigation projects. Several studies have raised concerns about environmental integrity, though a systematic evaluation is missing. We synthesized studies relying on experimental or rigorous observational methods, covering 14 studies on 2346 carbon mitigation projects and 51 studies investigating similar field interventions implemented without issuing carbon credits. The analysis covers one-fifth of the credit volume issued to date, almost 1 billion tons of CO₂e. We estimate that less than 16% of the carbon credits issued to the investigated projects constitute real emission reductions, with 11% for cookstoves, 16% for SF₆ destruction, 25% for avoided deforestation, 68% for HFC-23 abatement, and no statistically significant emission reductions from wind power and improved forest management projects. Carbon crediting mechanisms need to be reformed fundamentally to meaningfully contribute to climate change mitigation.