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California’s Carbon Offset Program Is a Complete Disaster

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Photo: Marcio Jose Sanchez (AP)

As businesses in California race to tamp down their emissions by buying carbon offsets, some serious math errors in the program may mean more carbon dioxide—not less—is being added to the atmosphere.

On Thursday, ProPublica and MIT Technology Review published an investigation into forest offset programs in California, based on an analysis created by CarbonPlan, a nonprofit that specializes in looking into carbon removal programs. The story shows the issue of relying on offsets, a tactic increasingly favored by all sorts of businesses, rather than cutting emissions in the first place.


“Our work shows that California’s forest offsets program increases greenhouse gas emissions, despite being a large part of the state’s strategy for reducing climate pollution,” Danny Cullenward, the policy director at CarbonPlan, told ProPublica. “The program creates the false appearance of progress when in fact it makes the climate problem worse.”

The idea of using forests as a carbon market is, in theory, a pretty basic one. “The simple idea is that if some company wants to reduce its emissions, or is required to reduce its emissions, instead of reducing them itself, it can pay somebody to preserve more forests and restore more forests,” Timothy Searchinger, a senior research scholar at Princeton University, said. “Forests store carbon, and if they’re going to chop down the forest, the theory is [by paying to keep the forests] you avoid that level of emissions, and that’s as good as reducing your level of emissions by, let’s say, burning natural gas or oil.”


According to CarbonPlan, California’s offsets program is the biggest such program currently in existence and is valued at around $2 billion. The state gives foresters around the country credits for maintaining forests that they can then sell to companies based in California. Those California-based companies, in turn, are allowed to use these credits as offsets for their own pollution. As of last year, ProPublica reported, the plan had generated around 70 projects that had created more than 130 million credits that were then put on the market.

Unfortunately, nature isn’t an exact set of mathematical equations, and there’s a lot of squishiness that comes with a program like this. The accounting for the credits comes from land surveys of the forests in question, and how much carbon they’re estimated to store compared to regional averages. The analysis found evaluators seemed to have overgeneralized and cherry-picked in a way that greatly overestimates the amount of carbon stored in specific areas.

In one forested area in Northern California examined by ProPublica, accounters drew a line down a map to separate what they said was an area full of redwoods on the coast, which store a lot of carbon, from an inland region with trees that can store less carbon. Much of the forest on either side of the line, however, is identical. A forest manager choosing to maintain a plot on the inland side could snag more than 600,000 carbon credits, worth around $8 million because those trees would appear to sequester more carbon than average. Meanwhile, that same size plot situated west of the dividing line would earn nothing.

And it wasn’t just this one area that had issues. The CarbonPlan analysis estimates that almost 30% of the offsets in the program are overvalued, creating more than $400 million in excess credits. This kind of dodgy accounting has consequences for the program—and the climate—as a whole. CarbonPlan estimated that the overvalued offsets actually add millions of tons of carbon dioxide because of this overcounting, as the bogus credits essentially enable companies to keep polluting.


Overinflation of specific parcels of land in a carbon offsets program isn’t the only issue plaguing the concept of forest-based carbon offset programs, said Searchinger. There’s a lot of big-picture questions about the value of these types of programs that pay to keep carbon intact—chief among them the idea that simply paying for one chunk of land to stay intact doesn’t protect it over the long term (especially in the age of raging wildfires) or prevent surrounding land from being destroyed.

“If you don’t chop down your forest, but the demand for wood doesn’t change, or the demand for beef doesn’t change—somebody next door, maybe in the next province, clears more land to meet the supply,” Searchinger said. “If you pay somebody, even though that guy didn’t chop down his forest, how do you know someone else won’t chop theirs down? The big question is, how do you know if you’re actually reducing deforestation?”


The California program investigated in the ProPublica story is the biggest one that’s regulated by a government, and it’s in a state that is racing to reduce its greenhouse gas emissions. But other states and the federal government have shown interest in investing in forests as ways to bring down carbon, some influenced by California’s example, and business is booming for voluntary carbon markets as businesses in every sector try and figure out ways to address down their emissions—and fast.

The types of accounting problems outlined in the ProPublica report could metastasize as more and more ways of trying to incentivize offsets pop up. Even if California is able to iron out the problems with its own market, the idea that companies could keep polluting while “lowering” their emissions exclusively through offsets is a complete fallacy that would ruin the climate.


“We need to get rid of fossil fuels and we need to protect all our forests,” Searchinger said. “If you emit more fossil fuels to protect your forests, that’s not going to get us there. The question is, how do you make this happen and how do you make it happen right?”