Do carbon markets underestimate forest climate risk?

Carbon credits may miss climate-change threats to U.S. forests

A warning article based on new research says that carbon markets can underestimate the risks climate change poses to U.S. forests—despite the central role forests play in many climate policies. Those policies often rely on “carbon credits,” which are issued to polluting industries in exchange for protecting or restoring forests. In practice, the system depends on an assumption that forests will reliably store carbon over time.

The problem is that forests are not static carbon vaults. Rising temperatures, changing rainfall, more frequent extremes, and pest and wildfire pressures can reduce tree growth and increase tree mortality, which can weaken or reverse a forest’s ability to store carbon. If carbon accounting models don’t fully capture these changing risks, the credits issued today may overstate the long-term climate benefit.

Underestimation is particularly important because carbon-credit schemes can be used to justify continued emissions by industries and can influence public and private investment decisions. If forest storage benefits decline faster than expected, a policy designed to reduce atmospheric greenhouse gases could instead create an accounting gap.

Why this matters now

• Many national and corporate climate plans treat forest carbon storage as a key compliance mechanism.
• Climate impacts on forests are increasingly variable and extreme.
• If credits are issued using overly optimistic storage expectations, real-world emissions reductions may not match the climate benefit implied by the paperwork.

The article’s core point is not that carbon markets should never include forests, but that the risk side must be modeled more realistically—especially under the stresses forests are already experiencing.