The Proposition of Value: Leveraging Carbon Capital to Finance Biodiversity Conservation in Peru

Carbon offsets and carbon markets have generated great interest in their potential as a market-based source of funding for biodiversity conservation. Since the concept of creating markets for “offsetting” greenhouse gas emissions was first discussed, there has existed an accompanying narrative that such markets would inevitably generate both profits for investors and “co-benefits” in the form of biodiversity conservation and associated sustainable development goals. However, because direct financial returns from forest-based carbon offsets seem both low, while also high risk, we ask why this approach is being so heavily promoted and implemented as a means to finance conservation. Employing a comparative case study design, we examined four carbon-financed conservation projects in Peru to explore the set of “value propositions” offered by these projects and for whom to explore what is driving the continued interest and implementation of these schemes and to understand how various types of value (e.g. direct and indirect financial returns, reputational or social license value, political capital, etc.) are produced and captured and the barriers to doing so. Through analysis of project documents, promotional materials and the transcripts of key actor interviews, we developed detailed stakeholder maps and written case studies. Our final assessment maps and characterizes the values, costs, and risks accrued by each set of actors in the value chain and the ways in which these dynamics influence the viability of employing carbon offsets to finance biodiversity conservation.