Nuevo San Juan Improved Forest Management

CNaught maintains a very high quality standard for all projects in the portfolios we manage. To ensure that a project meets this standard, we perform due diligence that’s backed up by third-party ratings agencies’ independent due diligence. 

 
Additionality:
This project has high additionality, meaning it is very unlikely that this project activity could have occurred in the absence of carbon funding. The Indigenous Community of Nuevo San Juan Parangaricutiro has successfully operated sustainable forest management for nearly 40 years through their Forestry Development Program, which was financially supported by the government and generated some revenue from pine resin operations and timber. However, the landscape has fundamentally shifted with two critical developments that now make carbon revenue necessary for continued forest protection. First, the region faces severe and growing pressure from illegal avocado plantation conversion, with Michoacán accounting for 80% of Mexico’s avocado production and an estimated 50% of plantations being unauthorized. Strong social and economic pressures drive communities throughout the state to clear forests for lucrative avocado cultivation, creating unprecedented threats that require the project to conduct daily surveillance and coordinate with authorities to prevent illegal deforestation. Second, government funding for forest conservation has significantly decreased in recent years, with the community receiving no support since 2019. While state and federal laws incentivize sustainable management, funding cuts have severely undermined their effectiveness at precisely the moment when external threats have intensified. Carbon finance now provides the incremental funding necessary to maintain enhanced protection measures including daily patrols and surveillance infrastructure that defend against widespread forest conversion pressures in a region where illegal deforestation for avocado plantations has become endemic.
Over-Crediting:
This project has a low risk of over-crediting, meaning that it is likely to have accurately accounted for the amount of carbon emissions being avoided and removed from the atmosphere. The project demonstrates conservative carbon accounting through several methodological safeguards that reduce the likelihood of inflated credit claims. Baseline carbon stocks are fixed at project start date levels throughout the entire project lifetime, eliminating the risk of inflated baselines. Business-as-usual harvesting levels are conservatively capped at the six-year pre-project average, and remote sensing verified that there is no evidence of increased forest clearing prior to project start to maximize credits. Satellite imagery also confirms strong alignment between reported and actual forest behavior, with the project’s claimed carbon stock growth in standing wood pools matching detected forest canopy behavior. Additionally, reported harvesting volumes align well with detected clear-cutting activity, with high reported volumes appropriately explained by the inclusion of thinning and other non-clear-cut harvesting methods beyond what satellite imagery captures. Market leakage is conservatively quantified through an individual approach across eight activity areas: a 20% default leakage factor is applied to all areas harvesting below business-as-usual levels.
Durability:
This project activity is highly durable as we are confident in its ability to provide permanent carbon removals. The project benefits from strong land tenure security with no disputes according to the Agrarian Attorney’s Office, and the Indigenous Community of Nuevo San Juan Parangaricutiro has a proven 40-year track record of successful forest stewardship with diversified revenue streams including pine resin, timber, fertilizer, and ecotourism that provide financial resilience beyond carbon credits. Fire risk is moderate despite no significant impacts recorded between 2001-2022, as fire risk is projected to increase over the next 30 years under climate change scenarios. This increasing risk is mitigated by the community’s extensive fire management infrastructure including fire breaks, warning signage, detection towers, year-round surveillance patrols, and trained permanent and auxiliary fire brigades. Pest outbreak risk is moderate as the project is located in a high-risk zone for bark beetles, with 60% of tree species being pines; however, the project’s polyculture composition of native species reduces susceptibility to severe outbreaks, and monthly patrols by specialized technical personnel monitor for early pest detection with no issues reported to date. Drought risk is moderate and increasing under climate projections, though no severe historical droughts have been observed through 2022 and the project’s implemented thinning practices reduce inter-tree competition and accelerate growth recovery. The most significant durability strength comes from active management of anthropogenic risks: the community conducts daily surveillance patrols and coordinates with authorities to successfully defend against external pressures from illegal avocado plantation conversion, which represents 50% of the state’s avocado cultivation and creates persistent deforestation pressure throughout the region.
Double-Counting:
The project credits have a very low risk of being double counted. There are no regulatory obligations being met by the project activity and the project’s registry, Climate Action Reserve, has mechanisms in place to ensure that the project is not registered in any other programs. We also confirmed that the project does not overlap with any other forest carbon projects to ensure that its credits are not claimed by other projects.