How does a carbon offset program work and how is additionality verified?

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1. 1

   Systematic assessment of the achieved emission reductions of carbon crediting projects.

   Nature communications (Probst et al.)Published Nov 14, 2024Checked Oct 18, 2026

   “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.”

2. 2

   Do Carbon Offsets Offset Carbon?

   American Economic Journal Applied Economics (Calel et al.)Published Dec 31, 2024Checked Oct 18, 2026

   “We develop and implement a new method for identifying wasted subsidies and use it to provide systematic evidence of the misallocation of carbon offsets in the Clean Development Mechanism—the world's largest carbon offset program. Using newly constructed data on the locations and characteristics of over 1,000 wind farms in India, we estimate that at least 52 percent of approved carbon offsets were allocated to projects that would very likely have been built anyway. We estimate that the sale of these offsets to regulated polluters resulted in substantially higher global carbon dioxide emissions.(JEL H23, O13, Q42, Q54, Q58)”

3. 3

   Progress in the study of product methodology development and competitiveness assessment model of voluntary carbon offsets.

   Carbon balance and management (Han et al.)Published Mar 31, 2026Checked Oct 18, 2026

   “Through systematic literature review, it analyzes the development characteristics, application scenarios, and existing challenges of international mainstream standards (VCS, GS, CDM) and domestic CCER and carbon credit methodologies. Using Analytic Hierarchy Process (AHP) as the core framework, the research optimizes a competitiveness evaluation model covering environmental, social, and economic dimensions. A case study of eco-friendly home appliances is conducted for validation, followed by multi-directional comparisons with five existing models. Results indicate that international methodologies emphasize rigor and sustainability verification, while domestic approaches prioritize policy adaptability but face fragmentation challenges. The improved model demonstrates superior performance in environmental and social dimension evaluations compared to traditional models, offering enhanced comprehensiveness and specificity. This study provides scientific tools for methodological selection and competitiveness assessment of voluntary carbon reduction products, offering decision support for carbon market standardization and low-carbon economic transition.”

4. 4

   Learning lessons from over-crediting to ensure additionality in forest carbon credits.

   Nature communications (Swinfield et al.)Published Apr 11, 2026Checked Oct 18, 2026

   “Independent evaluations have shown substantial over-issuance of REDD+ (Reducing Emissions from Deforestation and Degradation) credits traded on the voluntary carbon market. We synthesise these evaluations to estimate the additional forest conservation achieved by first-generation REDD+ projects and to identify mechanisms underlying over-crediting. We combine six independent ex post evaluations of avoided deforestation covering 44 REDD+ projects. These evaluations show that most projects reduced deforestation, but that they claimed an aggregate of 10.7 times more avoided deforestation than is justified by independent estimates. This discrepancy is not driven by the choice of forest cover data, but by selection bias in projects' control areas and modelling approaches. Although recent initiatives that transfer assessment to unconflicted parties and restrict methodological flexibility are critical, they are insufficient. Ex post certification against credible counterfactuals is necessary if carbon markets are to represent causal reductions in deforestation.”

5. 5

   Methodological issues with deforestation baselines compromise the integrity of carbon offsets from REDD+

   Global Environmental Change (West et al.)Published Jun 10, 2024Checked Oct 18, 2026

   “Overall, we observe large discrepancies among the project baselines. On average, the highest baseline value we calculate for each project is more than 14 times greater than the lowest value across the four projects studied. This illustrates the lack of robustness and consistency across the VCS-REDD+ methodologies. The results also call into question the additionality of carbon offsets issued based on these methodologies. New baseline methods need to be urgently developed if voluntary REDD+ projects are to reliably estimate their additional contribution to climate change mitigation. The incorporation of causal inference methods represents current best practices in measuring the efficacy of REDD+ interventions. Regrettably, these methods remain largely overlooked by project developers, certification standards, and governmental and international bodies. Dynamic baselines developed by independent analysts could potentially enable project developers to distinguish the impacts of the REDD+ intervention from confounding factors and properly estimate additionality.”

6. 6

   International carbon markets for carbon dioxide removal

   PLOS Climate (Michaelowa et al.)Published May 8, 2023Checked Oct 18, 2026

   “The Kyoto mechanisms and the large voluntary carbon market standards have long focussed on biological removals without inherent storage permanence and only recently started to develop methodologies for removals with geological storage, mineralization or biochar. Driven by high prices for credits from emerging removal technologies and advance market commitment initiatives targeting high permanence removals, various newcomers in voluntary markets are currently establishing their own approaches for generating removal credits. However, they disregard key concepts safeguarding market quality such as additionality, which risks triggering scandals and tainting the entire market for removal credits. Given the diversity of credit prices spanning three orders of magnitude from 1 to 1000, as well as of volumes ranging from a few hundred to tens of millions of credits, the current “gold rush” atmosphere of removal markets needs to quickly be replaced by a coordinated approach, ensuring credibility, and enabling removals to play the required role in reaching global net zero.”