Severe climate conditions must now be standard planning assumption for forest carbon projects, new analysis finds
By Bilal Hussain
New study compares wildfire forecasts against three major fire seasons in Brazil, Australia and the United States, finding that only the severe warming scenario accurately predicted the scale and spread of burning
Moderate climate scenarios missed around half of the land that ultimately burned across all regions, confirming that historical climate assumptions now underestimate real-world fire risk
As forests take centre stage at upcoming COP30 talks, the research shows that long lead-time forecasts can highlight major fire risk well in advance, allowing more resilient planning of forest carbon projects
LONDON, Wednesday 5th November 2025: As global negotiators prepare to meet in Belém for COP30 next week, Artio, a pioneering carbon insurance firm, has released new wildfire analysis showing that extreme climate conditions are already shaping the fire risk facing forestry carbon initiatives around the world.
With nature-based solutions expected to feature prominently on the agenda in Brazil, the findings highlight the need to plan and implement carbon projects for the emerging climate, rather than for conditions of the past.
Leveraging Artio’s proprietary risk models, the study compares wildfire predictions against three fire events of global significance. These include the 2020 Pantanal fires in Brazil, the Gospers Mountain fire during Australia’s Black Summer in 2019-2020 and the record-breaking 2020 wildfire season in the United States.
Across all three, only a severe climate warming scenario produced forecasts that matched the true scale and spread of the fires. Milder scenarios that relied on historical climate norms consistently underestimated risk.
Key findings from the case studies
In the Pantanal Wildfires, the world’s largest tropical wetland, the model correctly identified nearly three-quarters (72%) of the area that later burned when run one month before the peak fire period. As drought intensified, the spatial accuracy of the forecasts increased sharply, underscoring how rapidly evolving conditions can transform landscapes that are typically resistant to fire.
In Australia, the one-year-ahead forecast under a severe climate warming scenario also identified three-quarters (74%) of the eventual burned area in the Gospers Mountain fire, the largest single-ignition forest fire in Australian history. Short-term forecasts made closer to the event proved far less accurate. This result shows that the country’s worst fires were not simply a consequence of seasonal weather, but the product of extended heat and drought driven by broader climate change.
In the United States, the extreme warming scenario model produced the most balanced and reliable performance, more than double that of comparable academic models tested for the same forecasting horizon. The analysis suggests that the conditions shaping US megafires align more closely with future climate projections than with the historical climate record.
A shift in how projects must be planned
With billions of dollars in new financing for nature-based solutions expected to be discussed in Belém, the findings highlight that many carbon projects are being developed in landscapes where fire risk is shifting faster than current risk management frameworks account for.
Short-term forecasts remain essential for operational fire preparedness, but they do not capture the long-duration drought conditions that drive the largest landscape-scale fires. Long-term scenario-based planning is now necessary to ensure project durability and credit reliability.
Bilal Hussain, Co-Founder and CEO at Artio, commented:
“COP30 will place forests and nature-based climate solutions at the centre of global climate plans. However, for those solutions to endure, they need to be designed for the climate we are moving into, not the one we are leaving behind. Our analysis shows that what once would have been viewed as an extreme scenario should now be the baseline for responsible planning and risk management.”
Hussain added:
“Short-term forecasts are vital for day-to-day readiness, but they often miss the risks that develop over many months. While fire isn’t the biggest loss driver for ARR projects today, insurers and project developers need to factor in longer-term climate drivers if they want to ensure the durability of investments and the integrity of carbon credits.”
Supporting climate-resilient carbon development
As interest in afforestation and forest restoration grows, developers and investors will need to treat severe warming scenarios as the default planning basis. This means identifying sites that remain viable under hotter, drier future conditions, incorporating adaptive fire management strategies and maintaining continuous monitoring throughout the project's lifetime.
By providing early-stage insurance informed by wildfire risk assessments and long-term climate scenario evaluations, Artio supports nature-based project developers in designing resilient, creditworthy projects capable of delivering climate impact over decades.
