REDD: When carbon credits work in the Amazon

This article is the second in a three-part series that explores the issue of deforestation and climate change. In part one, GlobalPost considered how a proposed international carbon-credit market could slash greenhouse-gas emissions and save the world's surviving forests. Part two shows how indigenous people can benefit from carbon credits, while part three looks at "carbon cowboys" accused of abusing the system.

PUERTO MALDONADO, Peru — Sitting on the porch of his ramshackle wooden hut, shaded from the Amazonian sun by the thick rainforest canopy, Brazil nut collector Eleuterio Martin admits he has never heard of global warming.

Yet Martin, 73, is now set to play his part in a groundbreaking new project that could become one of the most effective ways to curb rising global greenhouse gas emissions.

He is one of hundreds of local people here in the Madre de Dios region of Peru, near the Bolivian border, who have teamed up with Bosques Amazonicos, a Lima-based company that plans to market carbon credits generated by protecting the rainforest on the land where they have government concessions to harvest Brazil nuts.

Read more: Building the credit market

Although it varies significantly based on latitude, altitude, precipitation and forest type, one acre of Amazon rainforest can sequester more than 150 metric tons of carbon.

In total, Bosques Amazonicos plans to help conserve 360,000 hectares (890,000 acres) of rainforest, thus preventing millions of tons of carbon emissions.

By doing so, the company expects to eventually generate annual revenues of $5 million from the sale of carbon credits.

Of that, 30 percent will be handed over to the Brazil nut collectors, who live a largely subsistence lifestyle, growing their own food and currently earning an average of around $2,000 a year. The other 70 percent will go to the company’s investors.

The credits will be sold on international “voluntary” carbon markets to businesses that freely opt to offset their carbon footprints.

Although it is their own choice, many of those companies will be preparing themselves for the post-carbon world, in which new laws, expected in the coming years, will require them to emit fewer greenhouse gases.

Read more: Carbon cowboys in the Amazon

The project will have to be independently certified, with experts doing everything from counting and measuring the trees in the Brazil nut concessions to calculating the theoretical rate of deforestation that would have taken place without Bosques Amazonicos’ intervention.

The project works because Madre de Dios’ forests are under threat. Carbon credits from forests that no one is about to cut down are worthless.

Martin’s 246-hectare concession is just five miles from a major new road, the Interoceanic highway. Intended to link Brazilian commodities with Asian markets via Peru’s Pacific ports, the Interoceanic has also literally paved the way for illegal loggers, poachers, miners and land-squatters to penetrate the dense rainforest in numbers.

During the two-hour motorbike ride from the regional capital Puerto Maldonado to Martin’s home, along a rutted, often flooded dirt track, we pass through dense stretches of forest interspersed with open fields with grazing cattle.

This is what tropical deforestation looks like on the ground.

In particular, the wave of illegal gold-mining sweeping the region means that Martin and his neighbors now have to be on constant alert against trespassers using primitive mining techniques that destroy the rainforest — including the ancient Brazil nut trees — for a few grains of gold.

Bosques Amazonicos is helping the Brazil nut collectors by placing boundary markers around their concessions for the first time and giving them legal support against intruders.

The backing of the company and its lawyers is critical in this remote, frontier region where law enforcement is usually notable only by its absence.

Bosques Amazonicos is also helping the collectors plant more trees, giving them small loans to buy equipment at the start of each “zafra,” as the harvest is known, and financing the construction of a $1.9 million processing plant, 70 percent of which will be owned by the Brazil nut collectors.

All in all, the average Brazil nut collector can expect to double their income from the carbon credits alone, while also benefiting from the better prices that come from marketing finished products rather than raw, unprocessed nuts.

“This is like a marriage. It is a long-term relationship, that must last 30 or 40 years,” says Jorge Cantuarias, Bosques Amazonicos’ general manager.

“That is not going to happen unless people are happy with the arrangement. This is a business, but we are being very transparent and dealing with people extremely fairly.”

Yet not all carbon entrepeneurs have managed to establish such amicable relationships with rainforest communities. Some, so-called carbon cowboys, have attempted to take advantage of indigenous groups, persuading community leaders to sign away rights to carbon and other resources on their land in languages they do not even understand.

For Martin, however, his arrangement with Bosques Amazonicos has worked out well, he says.

“Life is difficult here,” he muses, as chickens and ducks scamper by. “But I hope that my children and grandchildren can carry on as Brazil nut collectors. It would be terrible if all this forest disappeared and was turned into pasture or was just abandoned after the miners have contaminated it.”