New study finds potential profits in forests conservation

The World Bank's Timothy Brown, a natural resources management specialist in Indonesia, said the calculations seemed reasonable based on the expectation of growth within the carbon markets over the next 10 to 20 years.

But he said there still remains many questions about setting up the system known to avert deforestation and convincing local governments and companies to abandon the much greater certainty of gaining profits from palm oil for the much less certain prospect of earning money trading carbon credits.

"It's not only that the carbon markets are uncertain but the guy trying to access the carbon market is uncertain how to do it," Brown said. "He knows where to go to sell his oil palm. He knows these people. With the carbon market, who does he call? It's not a smooth and frictionless market."

Palm oil can be found in half of supermarket products from cosmetics to ice cream, according to the industry, and demand has risen sharply in China, India and the United States. The industry is also expected to grow as countries mandate the use of biofuels as part of a cleaner energy mix. But as its profile has risen so has the controversy surrounding the methods used to farm palm oil. Plantation companies in Indonesia and Malaysia -- which together produce 87 percent of all palm oil -- have come under fire for leading to deforestation that contributes to the demise of animals like orangutans and Sumatran elephants.

Indonesia, where already 15.1 million acres are covered by plantations, has aggressive expansion plans.

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