A new analysis of jurisdictional REDD+ (JREDD+) in Brazil’s Amazon reveals a big chance. The potential credit sales could reach $10–$20 billion this decade. However, the market faces delays, integrity issues, and a drop in voluntary demand.
The report from the Earth Innovation Institute (EII) outlines the numbers and assumptions. It also offers a roadmap connecting carbon credit sales to real forest results and social safeguards.
The $20B Amazon Question: EII’s JREDD+ Forecast
The Amazon remains a vital carbon reservoir, holding approximately 56.8 billion metric tons of carbon above ground. Brazil alone contains over 32 billion metric tons of this total. This carbon stock equates to more than one and a half times global annual CO₂ emissions in 2023.
EII’s Amazon Forest Climate Solution (AFCS) expects Amazon emissions from deforestation, fire, and logging to drop by 90% by 2030 from a 2018–2022 baseline. Then, they aim for a 95% reduction by 2040 and a 98% cut by 2050.
Brazil’s Amazon states could issue around 1.05 billion TREES standard credits. This would be for reductions achieved from 2023 to 2030. At $10–$20 per credit, that equals $10–$20 billion in potential revenue.
Timing matters. EII notes it typically takes two to three years to verify, issue, and sell credits. The four most advanced states—Acre, Mato Grosso, Pará, and Tocantins—might sell around 100 million credits in 2026. This could bring in about $1 billion at $10 per ton. That figure is roughly comparable to the $1.4 billion donated to the Amazon Fund since 2008.
A state-by-state table shows around 1,048.8 MtCO₂e in potential credits by 2030. This could bring in about $10.49 billion at $10 per ton. Pará leads with 348.5 Mt and $3.49 billion, followed by Mato Grosso with 200.1 Mt and $2.00 billion.
Why Billions Haven’t Flowed Yet
Analysts underscore the gap between early promises and actual transactions, while the EII report highlights these bottlenecks:
- No Brazilian state issued credits by June 2025.
- Only Pará and Tocantins signed forward Emissions Reduction Purchase Agreements (ERPAs).
- Acre and Mato Grosso are advancing through pay-for-performance (non-credit) mechanisms.
Meanwhile, the voluntary carbon market retrenched in 2023–2024. Global transactions fell to about 84 MtCO₂e from a 516 MtCO₂e peak in 2021, and forest/land-use project volumes slid from about 227 MtCO₂e to about 37 MtCO₂e. This slump undermines demand just as Brazilian states prepare to sell large volumes.
Put simply, the supply pipeline is maturing faster than demand. Integrity controversies around some project-level REDD+ credits have cooled buyers’ risk appetite.
EII argues that jurisdictional programs, using conservative baselines and including leakage deductions, can tackle many concerns. They also have social safeguards under the TREES standard. However, these programs still need clear policies and buyer confidence to turn modeled volumes into cash.
What Makes JREDD+ More Credible than Old REDD+?
EII emphasizes that JREDD+ credits reward performance at the state or national scale, not farm-by-farm activities. Also, participation is voluntary. The programs are created with Indigenous peoples, traditional communities, and farmers. They do not limit how landholders can use their land. Critically, project-level credits are subtracted from the jurisdictional pool to prevent double-counting.
Under TREES, crediting leaves out some removals, like those from fire-damaged forests. It also tightens baselines every five years. Moreover, there are significant deductions for leakage, uncertainty, and reversals. These choices underestimate climate benefits but aim to raise robustness.
These features are key to EII’s claim. They say JREDD+ can help finance quick emissions cuts now. Meanwhile, longer-term funds like the proposed “Tropical Forest Forever Fund” can grow.
Policy Shifts and Potential Buyers: From Petrobras to China
Converting potential into real revenue hinges on policy and demand signals:
- Domestic regulation:
Brazil’s federal government can explain how states can access Paris Agreement Article 6.2 transactions. This is for those who exceed the national NDC pathway. It could raise carbon prices and volumes for jurisdictional credits. - Corporate demand:
EII floats a COP 30 initiative where Petrobras convenes oil-and-gas peers to buy JREDD+ credits equal to about 1% of the sector’s Scope 3 emissions. This alone would multiply current forest and land-use demand on the voluntary carbon market tenfold. - Trade linkages:
A Brazil–China partnership on “forests, food, and climate” could link trade with local deforestation cuts. It might also direct credit purchases into state JREDD+ programs. Discussions are underway with Brazilian states.
EII believes these steps can shift the market from intent to action. They could also help bridge the multi-billion-dollar funding gaps in law enforcement, fire management, and regenerative land use.
What Success Would Mean for Climate — and the Amazon
The AFCS scenario suggests around 1.5 GtCO₂e in net reductions from 2025 to 2030. This is nearly double what the EU-27 is expected to achieve during that time. This relies on Brazil continuing to reduce deforestation and improving fire prevention and natural regeneration.
About 21% of the cleared land in the Amazon is marginal and turning back into forest. So, targeted incentives could boost natural regeneration at a lower cost than active restoration. This could also help stabilize regional rainfall.
EII connects climate benefits to public health and economic gains. This means fewer smoke-related illnesses and deaths. It also lowers risks for farm and forest investments. Plus, it creates new income streams for Indigenous peoples and smallholders. These include non-timber products, perennials, and aquaculture.
Still, EII’s main claim can be tested soon. If states set benefit-sharing rules, secure Article 6.2 eligibility, and finalize multi-buyer offtakes, then the first $1 billion in 2026 would prove that jurisdictional crediting works at scale.
Signals to Watch Before COP30
The report highlights COP30 in Belém, Brazil, as a pivotal moment for Amazon JREDD+. The country will host global climate negotiators in November 2025. This event will allow states to showcase their programs. They can also finalize pathways for Article 6.2 crediting.
EII believes COP30 can be used to reveal big corporate groups. This includes oil-and-gas or agribusiness buyers who commit to JREDD+ purchases. This event may determine whether modeled revenues of up to $20 billion move from projections to real contracts within the decade.
Some of the key market trends to watch are:
- State milestones: publication of final benefit-sharing frameworks and issuance of first TREES credits.
- Federal signals: Brazil’s alignment of Article 6.2 pathways for subnational programs.
- Buyer coalitions: oil-and-gas Scope 3 purchase commitments and commodity-trade linkages with China.
- Market breadth: whether jurisdictional credits revive voluntary carbon market volumes and pricing after the 2024 slump.
The EII report quantifies a plausible $10–$20 billion revenue pathway for Amazon JREDD+ this decade if governance, integrity, and buyer demand align. That level of financing could speed up Brazil’s forest-climate shift and provide social benefits. But this will only happen if policies and purchase commitments develop as quickly as expected.
