Projected Global OTC Market for Forest Carbon Offsets to Hit $65 Million by 2015
The global forest carbon offset market is projected to grow from $42.0 million in 2010 to $65.1 million in 2015, according to the latest issue of EL Insights. This represents a compound annual growth rate of 9.2% during this time period.
Each year, approximately six million hectares of forests are lost due to human activity, such as logging, farming, and cattle rearing. To place this figure in perspective, six million hectares is about the size of Greece. Within the context of global warming, the large area of deforested land is troubling, as 15% – 17% of global greenhouse emissions come from deforestation. This is more than the total emissions that come from the world’s transportation sector. Furthermore, forests naturally sequester greenhouse gases in plants and soil and reduce the overall amount of greenhouse gases in the atmosphere; thereby reducing the overall effects of global climate change.
Many global policy makers see REDD as part of the solution in slowing and eventually stopping deforestation. REDD is a carbon reduction and forest conservation mechanism, which stands for Reduced Emissions from Deforestation and Degradation. REDD is a payment for environmental services (PES) scheme, in which governments, landowners, or indigenous peoples are paid for the carbon that is naturally stored in plants. Credits are issued based upon…
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