Three Types of Forest Carbon Projects and Why They Matter

Together, the different types of forest projects balance carbon storage, ecosystem services, economic and community development

Published in
8 min readSep 24, 2020


Forests — made up of trees which naturally pull carbon dioxide (CO2) out of the atmosphere and store it in their wood, leaves, and roots — present one of the most cost-effective and scalable opportunities available today to sequester carbon. Recognizing the importance of forests for solving climate change, people around the world are creating projects to protect, restore, and improve the world’s forests.

These projects, called forest carbon projects or just forest projects, involve planned activities to manage forest land over many decades or more to increase forest carbon storage over business-as-usual projections. Forest projects finance restoration and conservation by selling carbon credits that each represent one tonne of CO2 captured or emissions avoided over expected baseline conditions. Organizations can purchase carbon credits to fund climate change solutions.

While there are many ways to categorize forest projects, at Pachama we generally classify projects into three groups:

  • Reforestation to plant new forests on land
  • Forest conservation to protect old growth forests from deforestation
  • Improved forest management to grow mature, well-stocked forests using sustainable harvest practices

Together, these three types of projects help protect and restore the world’s forests while balancing ecological, social and economic needs. Let’s take a closer look at the three types of forest projects on the platform to understand the benefits and drawbacks of each and why all three types are important.


Best for restoring forests and dedicated carbon removal.

Reforestation projects plant thousands of trees, oftentimes reverting degraded land cleared for cattle or agriculture back to forest. Of the three forest project types, they are typically the best for quickly drawing CO2 out of the atmosphere, because young trees draw down more carbon from the atmosphere than fully grown trees. Reforestation projects earn carbon credits for every tonne of CO2 that they draw down from the atmosphere that is captured in tree biomass.

Because they involve planting thousands of trees at once, reforestation projects typically require more capital and labor than other forest carbon projects (making them often more challenging). They also tend not to support the same level of biodiversity and ecosystem benefits as natural mixed-age forests. While some projects emphasize restoring biodiversity, many others balance ecological considerations with economic and social benefits.

Pure ecosystem restoration projects work to regrow land with native species in hopes of restoring ecosystems and preserving them in the long run. Fazendo Sao Nicolao in Mato Grosso, Brazil is an example of a project funded for the purpose of capturing carbon and restoring biodiversity. Fazendo Sao Nicolao has planted 26 native species over almost 2,000 hectares since 1999 on land previously deforested for cattle grazing.

Other reforestation projects combine tree planting with economic timber models where projects grow trees that are scheduled for harvest down the line. Even though these projects harvest timber they plant, they earn carbon credits because they commit to maintaining an average amount of carbon stock over the course of the project — and they should show that the project would not have occurred without carbon funding.

Although reforestation projects do not offer the same ecosystem services as natural forests, they provide employment and economic opportunity for local communities and are powerhouses of carbon capture.

Forest Conservation (Avoided Deforestation)

Best for protecting old-growth forest and wildlife habitat in areas a risk of deforestation

While reforestation aims to draw down carbon out of the atmosphere by planting trees, forest conservation (also called avoided deforestation in the carbon world) aims to protect the enormous carbon stored in existing old-growth forests. Tropical reforestation typically sequesters 11 metric tonnes of CO2 per hectare per year, but the loss of one hectare of mature forest can release more than 30 times that amount of CO2 — over 400 metric tons — all at once. That’s why it’s vital to not only plant trees, but also to protect existing forests that are under threat.

Forest conservation projects earn carbon credits by demonstrating that without their existence, the forest would be cut down or degraded. They are awarded credits for preserving the forest and avoiding the emissions that would be released if the trees were removed. Scientists generally agree that existing forests are absorbing carbon dioxide every year as well, but measuring at an individual project level is challenging so credits are usually awarded just for avoiding emissions.

Because forest conservation projects need to show that they are protecting forests that are actually at risk of deforestation, they typically occur towards the edges of tropical forests in developing countries where there is economic pressure from nearby communities to illegally harvest timber or convert forest land to agriculture. Conservation projects can come with some risk in the carbon world because they inherently exist in high-risk areas — and this is where Pachama’s technology can help.

Pachama uses satellites to closely monitor these projects for illegal logging so that we can quickly notify project developers when we detect deforestation and enable them to take action to prevent further damage to the forest. Satellite imagery can also demonstrate when a project has been highly effective — maps of the Manoa project in the Brazilian Amazon show how well the project has protected its forest even as the surrounding areas have undergone intense deforestation.

Although forest conservation projects are riskier than other project types, they also provide outsized benefits by preventing carbon emissions, protecting biodiversity, and empowering local communities. From a carbon perspective, tropical rainforests have the potential to release massive amounts of carbon if destroyed. From a biodiversity perspective, the number of plant and animal species in old growth rainforest is virtually inconceivable. One acre of Amazon rainforest may hold up to 70,000 species of insects alone. The number of plant species in the Amazon is unknown, but may be anywhere from 40,000–100,000.

Forest conservation projects protect habitat for a wide range of flora and fauna, including these Hoatzins found in the Madre de Dios project.

Many projects work in partnership with local communities to improve the lives of local people because they recognize that creating compelling economic alternatives to deforestation is one of the best ways to prevent it. Take for example, another project on the Pachama platform, Brazil Nuts Concessions. It’s a collaboration between the project developer and over 300 small land owners who are avoiding deforestation in the Peruvian rainforest by refocusing the local economy towards passive harvest of Brazil nuts.

Avoided deforestation takes the fight to where it matters most, where economics and politics make cutting down the forest very appealing. It’s also very cost-effective. Relatively small amounts of money can help conserve vast amounts of forest land — preserving the world’s most precious forests, improving lives of local people, and preventing millions of tons of CO2 from entering the atmosphere.

Improved Forest Management

Best for managing existing forests to produce forest products and maintain natural ecosystems

The McCloud River Project combines harvesting with long term land management, which also includes a number of other important services like wildfire management.

While not as evocative as preserving old growth rainforest nor as bold as planting millions of trees, Improved Forest Management (IFM) projects like McCloud River in Northern California are critical carbon projects that are great choices to support because they draw down carbon, maintain species habitat, and allow the sustainable harvest of timber all at the same time. IFM projects earn carbon credits by improving the carbon storage potential of the forests they manage over typical forestry practices.

Sustainably harvested forest products can play a role in reducing carbon emissions compared to traditionally mined materials. Mined materials typically have a much bigger carbon footprint. Steel production accounts for nearly 5% of global CO2 emissions, and cement is even worse, contributing 8% (although we are excited by the work other tech entrepreneurs are doing to change concrete production today). By contrast, a house built of wood is considered a carbon sink — CO2 was removed from the atmosphere and stored in the wood construction. The challenge is to produce forest products sustainably.

A pillar of modern sustainable forestry operates around the idea of capturing mortality and replicating the natural disturbance regime. In a natural forest of any age, trees are constantly competing with one another for sunlight. As the forest ages, large trees overshadow their neighbors and kill them off. If we can determine that a tree will die soon, we should harvest it and use its wood, rather than letting the wood decay and release the carbon back into the atmosphere (although IFM will leave some logs to decay for ecosystem health). Such an approach replicates the natural regeneration cycle of the forest. In this way, we can obtain a constant supply of wood from the forest (and store carbon in wood products) without diminishing the forest stock or significantly disrupting ecosystem services like water filtration and species habitat.

Although not every IFM project focuses on capturing mortality, one thing they all have in common is that their regulations and duration demand long-term thinking. Forest managers must consider the carbon stock of the forest decades into the future and ensure that the forest regenerates and protects larger, older trees over time. Since IFM projects manage for growth rates, they can capture large amounts of CO2 as the trees grow and mature. In fact, some of the projects that draw down the most CO2 per hectare on our platform — like Rips Redwoods in Northern California — are actually IFM projects! IFM projects balance ecological and economic needs by allowing sustainable timber harvest while providing the full suite of ecosystem services, protecting species diversity, and maintaining mature forests that are nearly indistinguishable from natural ones to the untrained eye.

Picking Projects Aligned with Your Goals and Values

The scale of the climate change problem requires large scale action and a combination of many different solutions — and so rather than promoting one type of project over others, we encourage you to support a project (or multiple projects!) that aligns with your goals and values.

If you want to maximize carbon sequestration from the atmosphere, then reforestation projects or improved forest management projects may be the right choice for you. If protecting old-growth forest from deforestation is your priority, conservation projects will probably appeal to you. And if you want to promote sustainable stewardship of existing forest ecosystems, be sure to consider improved forest management projects.

Pachama makes it easy for businesses and individuals to support forest projects through the purchase of carbon credits. Ready to start exploring? Visit Pachama today to learn more about the forest projects on our platform.