Forest Carbon Markets Have Matured

A report released by Ecosystem Marketplace finds that the forest carbon markets have made substantial progress in the last 3 years. The report, “State of the Forest Carbon Markets 2009: Taking Root & Branching Out” (pdf), examines the forest carbon markets and looks at their development and their growth.

In a post about the report, Steve Zwick says

The findings…indicate substantial shifts in growth patterns over the past three years, during which these markets have matured substantially.

From 2007 through the first half of 2009 alone, forest carbon markets have funneled roughly $100 million into forestry conservation projects around the world, transacting 20.8 million MtCO2 in the process. In dollar terms, this period represents 67 percent of the market value of all forest carbon offsets, due to higher volumes and prices associated with emerging interest in the voluntary carbon markets overall, along with maturing standards and infrastructure.

Overall, prices for forest carbon credits ranged from $0.65/ tCO2 to more than $50/ tCO2. Over time, the volume-weighted average price was $7.88/ tCO2. The compliance markets have commanded the highest prices overall, with a volume-weighted price average of $10.24/ tCO2 over time, followed by the voluntary OTC market at $8.44/ tCO2 and the CCX at $3.03/ tCO2.

Zwick ends his post by stating, “The survey results signal robust and growing belief in the ability of ecosystem markets to help reverse climate change.”

The report was released with support from the World Bank BioCarbon Fund, Biological Capital, Ecosystem Restoration Associates and Baker McKenzie, funding from the United States Agency for International Development (USAID), the David and Lucile Packard Foundation, the Norwegian Agency for Development Cooperation, the United Kingdom’s Department for International Development and the Surdna Foundation.

Download the full report (pdf)