Sociological study finds pros and cons in a REDD+ carbon credit scheme in the Brazilian Amazon that rewards small-scale ecosystem service providers in local communities.

• To safeguard the almost 90 percent of its land still covered with forest, the small Brazilian state of Acre implemented a carbon credit scheme that assigns monetary value to stored carbon in the standing trees and rewards local “ecosystem service providers” for their role protecting it.
• Acre’s System of Incentives for Environmental Services (SISA) rewards sustainable harvesting of rubber, nuts and other commodities from the forests. Crucially, it doesn’t make land tenure a prerequisite to qualify for incentives such as subsidies and agricultural supplies.
• But a new study criticizes the program for giving state officials the power to determine what counts as “green labor.” The program already promotes intensive agricultural practices and artificial fishponds, and experts warn more damaging practices may be permitted under the control of new state officials.
• There’s also no definitive evidence that the program works to conserve forests, with the rate of deforestation in Acre holding relatively steady since SISA came into effect.

A state-run carbon credit scheme that aims to reduce deforestation also generates financial and social benefits for some poor rural communities by side-stepping the red tape of land tenure rights often required by such schemes, according a recent anthropological study published in The Journal of Peasant Studies.

Despite widespread deforestation in the Amazon, the small state of Acre in western Brazil is still close to 90 percent forested. To protect the remaining 164,000 square kilometers (63,300 square miles) of standing forest, the state’s System of Incentives for Environmental Services (SISA) offers rewards to local communities to pursue livelihoods that don’t degrade the forest, financed by monetizing the carbon stored within it.

Maron Greenleaf, an anthropologist at Dartmouth College in New Hampshire, interviewed residents, government officials and local stakeholders such as the Indigenous Missionary Council Missionary Council (CIMI), the Federal University of Acre, and the agroforestry group PESACRE, to find out how SISA is working on the ground. She describes how poorer rural people are not excluded from the carbon credit scheme because of their lack of formal land rights, but warns there are also risks to the approach, which gives state officials power to define what activities are incentivized.

Monetizing carbon capture

First approved by state legislature in 2010, SISA is part of REDD+, a voluntary program negotiated by the United Nations Framework Convention on Climate Change (UNFCC) that aims to generate market incentives for protecting carbon-rich forests in developing nations while having a positive socioeconomic effect on surrounding communities.

Often, “the only way that people can earn money from the forest is by felling it for timber and/or clearing it to create space for agriculture, cattle, or other land uses,” Greenleaf said. REDD+ programs attempt to redress this imbalance, by “seek[ing] to give monetary value to forests’ carbon sequestering ‘service,’ so that the standing forest too has value that reflects — to some extent and in monetary terms — its climatic value,” she said.

The German development bank KFW has purchased 25 million euros ($28 million) of carbon credits, valuing Acre’s forests by their absorbed carbon dioxide, in exchange for a 16.5 percent reduction in the state’s forestry-related greenhouse gas emissions between 2011 and 2015.

SISA differs from more traditional carbon-offsetting models, where land ownership forms the basis for distributing the financial benefits of forest protection. Instead, it rewards those individuals who have directly worked on the land in a way that is classed as beneficial. SISA describes rural producers of sustainable crops and forest products (such as legumes, Brazil nuts or rubber), and who avoid harmful activities like controlled burning, as “ecosystem service providers” and offers incentives such as free services, agricultural supplies, and subsidies for their continued labor. The program promotes activities such as sustainable cattle ranching and fish farming on previously cleared land.

A similar state-run REDD+ scheme in neighboring Amazonas state, called Bolsa Floresta (PBF), has been running since 2007. However, SISA was the first scheme to be applied at the state level, rather than to a limited number of specified conservation units. PBF offers a small payment to residents who produce sustainable forest commodities such as cacao, açaí berries and arapaima fish, or practice agroforestry or lake management, in exchange for a commitment to zero deforestation and participation in environmental educational programs.

Greenleaf credits what she calls SISA’s “green labor” approach for side-stepping complex land rights issues that are common in rural Brazil and other countries with carbon-rich forests, and sharing some of the value of tropical forests’ stored carbon with some of the rural people who live in and around them, rather than wealthy landowners and foreign investors.

By giving market value to the carbon sequestered by standing forests, carbon-offsetting schemes run the risk of promoting violent land grabbing over forested land, sustaining inequality, and rewarding only the wealthiest. For instance, a 2018 studyfound that REDD+ schemes in Brazil have tended to increase residents’ insecurity over land tenure. But implemented in the right way, offsetting schemes can also act as a form of state welfare, redistributing wealth based on environmental goals, Greenleaf says.

Among her interviewees were 30 rural acreanos — small-scale farmers, ranchers, hunters, and forest collectors of mixed heritage. This is a group that has historically often been unable to obtain formal land rights, but many of them said they have been able to benefit from the SISA scheme through their contribution of green labor.

Land rights complexities

“REDD+ and related carbon-trading based schemes have the potential to be major game-changers with regards to halting global deforestation,” said Tom Martin, a terrestrial biodiversity and carbon specialist at the international conservation research organization Operation Wallacea. And yet globally, “REDD+ schemes … haven’t taken off nearly as quickly as people hoped,” he said, citing disorganized governments, unstable carbon markets, and complex land tenure systems.

In many heavily forested tropical countries, where carbon-offsetting schemes have the most potential benefit, land rights in rural areas are unclear, overlapping or fiercely contested, interwoven with complex indigenous rights issues. Such complexities can create uncertainty over how a proposed REDD+ project might be successfully implemented, making potential investors nervous and stalling carbon-credit schemes before they even get started, Martin said.

Bypassing land tenure as a means to allocate the rewards of carbon credit schemes has clear benefits, but it has also been criticized because it avoids the difficult process of securing land rights for rural and indigenous people who would benefit from land tenure in other ways. However, efforts to formalize rural land tenure have historically tended to favor the wealthy elites. For example, Terra Legal a national program to grant land titles to smallholder families in Amazonas state has issued fewer titles than planned and tended to favor existing landowners and agribusiness. Any attempt to redistribute land in a more equitable way would be a long and uphill battle. Instead, initiatives like SISA could act as a stepping stone, Greenleaf suggests: “SISA benefits might be enlisted in that struggle as evidence of government recognition of rural people’s rights to land.”

While the scheme is having clear benefits for local communities, the effect of SISA’s incentives on deforestation is more difficult to make out. The rate of deforestation in Acre remained relatively constant from 2010 to 2015 — the period during which SISA’s credit scheme came into effect — at between 220 and 310 square kilometers (85 and 120 square miles) per year, according to data from the Brazilian National Institute of Space Research’s (INPE) PRODES monitoring program. However Maron points out that many of the policies financed by SISA predated the program, making its true impact on deforestation hard to discern.

SISA has also been criticized for giving state officials greater power in determining what counts as green labor, leaving rural communities at the mercy of political whims. SISA has already made a few controversial decisions, such as categorizing intensive agricultural practices and artificial fishponds as ecosystem services. Martin said this is a common problem. “While REDD+ schemes are inherently supposed to yield social and biodiversity benefits as well as carbon sequestration,” he said, the primary focus on carbon stocks means that “the benefits to biodiversity can sometimes lag behind in project managers’ hierarchies of concern.”

Greenleaf warns that the shifting political mood in Brazil is already affecting people’s behavior. The estimated rate of deforestation in the Amazon increased by 50 percent between August and October last year as the presidential elections approached and victory for pro-agribusiness candidate Jair Bolsonaro became more likely. Since Bolsonaro’s win, deforestation across the Amazon has begun to rise alarmingly, and Acre has been no exception. The state saw an increase in the rate of tree loss in 2018.

New state officials were brought in with the new government at the start of this year, which could spell change for the administration of the SISA program. For example, SISA already supports agricultural intensification as a means to spare the remaining forest, which could be stretched to include industrialized agribusiness.

As a state-run program, the importance of SISA payments to rural communities is likely to increase. “These schemes are … poised to become more important with state protection in Brazil likely to be heavily withdrawn due to the new right-wing Bolsonaro administration,” Martin said.

Just as other environmental initiatives are under threat of funding cuts, SISA may be on course to receive a huge boost to funding. If California state administrators vote in favor of admitting REDD+ carbon credits, a 2010 memorandum of understanding, combined with high international regard for the program, puts Acre in line as the most likely supplier of those credits.

With inclusion criteria that could change at the whim of state officials, SISA may not offer the security to rural producers that it promises. However, “SISA … could also show Bolsonaro and other like-minded officials that it is not just cleared forest that has monetary value,” Greenleaf said.