Summary by Martin Edwini-Bonsu with review by the Climate Solutions Research Collective
On Wednesday November 12th, the Sustainability Hub convened the conference Negotiation to Innovation: Advancing Climate Action Through Research and Learning to explore themes from COP30. To learn more about this event, see the event summary by the Sustainability Hub as well as the summary of the closing plenary hosted by the Climate Solutions Research Collective.
One of the concurrent sessions was hosted by Professor Hisham Zerriffi (Forest and Conservation Sciences) and Assistant Professor Gregory Paradis (Sustainable Forest Management) sharing work from the 2024/2025 Solutions Scholars Program named “Forest Carbon Offsets: Climate Action or Sustainability Illusion”. The discussion focused on the complexities, challenges, and debates surrounding forest carbon offset systems as a climate mitigation strategy.
The session began by framing the fundamental problem that carbon offsets aim to address: entities in high-income countries face expensive options for reducing emissions, while landowners in various regions lack financial incentives to preserve forests or withdraw land from productive use.
Carbon offsets emerged as a market-based solution, allowing those with high abatement costs to pay for cheaper emission reductions elsewhere. The basic mechanism involves establishing a baseline activity (what would have happened without the offset), creating an alternate lower-emitting activity that only becomes viable through offset financing, and calculating the difference in emissions as tradable carbon credits. The concept of additionality is central, ensuring that offset projects would not have occurred without the support of carbon finance.
The presenters explained how forest carbon offsets operate through various protocols, with projects registered in official registries where credits can be purchased and either retired to offset emissions, traded in secondary markets, or purchased and retired by NGOs to create actual emission reductions. They distinguished between compliance markets, where entities face regulatory requirements to offset emissions (such as UBC under British Columbia provincial law), and voluntary markets, where organizations choose to offset emissions for public relations purposes.
A significant portion of offset generation occurs in low-income countries, where marginal abatement costs tend to be lower due to less existing infrastructure, lower land and labour costs, and higher biomass growth rates in tropical forests. These arrangements create potential co-benefits, including local economic development, health improvements, and other social benefits that might not receive funding through other mechanisms. Forest carbon projects dominate the British Columbia carbon registry, and the province produces a substantial portion of Canada's carbon offset credits.
Despite these potential benefits, the presenters outlined significant quality and credibility concerns. Baseline selection and additionality present fundamental challenges, as baselines project into the future, creating opportunities to inflate expected emissions to generate more credits. Leakage occurs when projects simply displace emissions outside project boundaries. Permanence questions the durability of carbon benefits, particularly given that climate change is a century-long problem while offset projects may only guarantee sequestration for 25 years, with additional risks from wildfires and insect infestations.
Beyond carbon metrics, many projects have reported negative social impacts, including exclusion of people from traditional lands, promised jobs failing to materialize, and corruption. Broader concerns include mitigation, deterrence and moral hazard, where the availability of offsets reduces incentives for companies to invest in internal emission reductions. One assessment found that only approximately 3 percent of offset protocols passed quality evaluations, and recent controversies around projects failing to produce claimed carbon reductions and generating negative local impacts.
Drs. Zerriffi and Paradis engaged participants in an interactive exercise where groups designed forest carbon offset systems by considering four key design elements.
The first element, carbon accounting protocols, required decisions about who establishes protocols, who funds protocol development, how baselines and additionality should be established, and who performs these calculations.
The second element, certification and offset issuance, addressed who issues certificates, what types of forest activities qualify for offsets, and critically, who can use offsets and for what emissions. This included ethical considerations about flows from low-income to high-income countries and whether offsets should be restricted to hard-to-abate residual emissions like aviation.
The third element focused on carbon reduction confidence, examining permanence requirements, how leakage should be measured, the required precision of carbon reduction measurements, and who conducts monitoring and verification.
The fourth element addressed non-carbon metrics, questioning whether carbon protocols should focus solely on carbon or explicitly include social and environmental safeguards, whether projects with safeguards should command price premiums, and who ensures safeguards are met.
Groups were asked to consider these elements in the design of both a “bad” or “low quality” offset system vs. a “good” or “high quality” offset system. Participants found the exercise revealed far more complexity than initially apparent, raising concerns about barriers to access for developing countries, difficulties with timeline commitments given risks like wildfires, and the prevalence of organizations claiming net zero status through offset purchases rather than actual emission reductions. The discussion turned to fundamental questions about whether the carbon offset system is worth pursuing and whether reform is possible.
The conveners concluded by outlining the central debate.
One camp believes the system can be reformed through continuous tightening of rules, with proponents arguing that legitimate projects are increasingly concentrated while questionable ones are being squeezed out. Another camp believes fundamental challenges make meaningful reform impossible. A third perspective questions whether market-based mechanisms can solve problems generated by capitalism itself. Dr. Zerriffi acknowledged these as active and contentious debates, with some advocating for abandoning offsets entirely in favour of mandatory emission reductions.
Would you like to learn more? You can review these materials produced by the 2024-2025 Solutions Scholars team:
Canada’s Carbon Offset Projects Probably Don’t Offset Carbon. What Could Replace Them? - Opinion Piece July 2025
Carbon Offsets: A Just Path Toward Climate Action or Sustainability Illusion? - Workshop Presentation June 2025
Carbon Offsets: Climate Action or Sustainability Illusion? - Poster Prepared for April 2025 Solutions Summit