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By Peter Coy

Opinion Writer

We’re all familiar with the riddle about a tree falling in the forest and making or not making a sound. Starting this weekend in Scotland, world leaders, diplomats and climate activists will be wrestling with their own version of the riddle: What does it mean when a tree does not fall in the forest?

A tree that does not fall in the forest continues to sequester carbon dioxide from the atmosphere, helping protect humanity from climate change. The riddle is who, if anyone, should get credit for the tree’s survival. To answer that question, you need to know whether the tree was going to be cut down in the first place. If it wasn’t, it seems dishonest to claim to have saved it. Yet people will be tempted to take credit anyway.

If you understand this problem, you will understand one of the main debates at the 26th United Nations Climate Change Conference of the Parties, or COP26, a meeting to combat global warming taking place in Glasgow from Oct. 31 through Nov. 12.

Economists like the idea of using markets to control carbon emissions because markets provide lots of bang for the buck. For example, Switzerland recently reached agreements with Georgia, Ghana, Peru and Senegal in which it will effectively pay those countries to reduce their emissions and then claim the reductions for itself to help meet its national target for emissions reductions under the Paris Agreement of 2015. It’s more efficient to cut emissions in those lower-income countries, where there’s plenty of low-hanging fruit (like replacing inefficient cook stoves), than in Switzerland itself, which has run short of cheap and easy ways to reduce emissions.

But governments need to make sure the markets are doing what they’re supposed to. Otherwise you run into the tree-in-the-forest problem: countries claiming credits for saving trees that didn’t need saving. That’s an issue in rich nations as well as poor ones. The San Francisco-based environmental group CarbonPlan said this year that forest protection efforts in California were over-credited by about $400 million. An investigation last year by Bloomberg Green found that the Nature Conservancy, the world’s biggest environmental group, was helping big U.S. corporations claim credit for the preservation of forests that were already well preserved. (In June, the Nature Conservancy said that an internal review did not discover irregularities but “found opportunities to improve our approach.”)

Negotiators in Glasgow will be wrestling with how to implement Article 6 of the Paris Agreement, the last part of the accord to be finalized. Article 6 governs the international trading of emission credits. The problem? “Article 6 is one of the least accessible and complex concepts of the global accord,” the World Resources Institute wrote in 2019. It added that “without the right rules in place, Article 6 could actually weaken” countries’ commitments to reduce emissions and increase global emissions.

One way Article 6 could fail is if it allows so-called double counting. A project to protect the Amazon, for instance, could be claimed by both Brazil and the rich nation that funded it.

Another form of failure would be the lack of “additionality,” as in the tree example. Let’s say a country decided to build a wind farm instead of a coal plant because the economics were better. It probably shouldn’t get credit toward its national goal for not burning coal that it didn’t intend to burn anyway.

“Leakage” is a related concern: If you pay one landowner not to cut down trees, that could cause prices of trees to go up and induce other landowners to cut down trees, leaving no net improvement.

Another conundrum: How much credit should countries get for emissions-reductions projects that were launched in the past, under the so-called Clean Development Mechanism, which is defunct?

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