Offset schemes help avoid or revert habitat loss through protection of existing habitat (avoided deforestation), through the restoration of degraded areas (natural regrowth), or both. The spatial scale of an offset scheme may influence which of these 2 outcomes is favored and is an important aspect of the scheme's design. However, how spatial scale influences the trade-offs between the preservation of existing habitat and restoration of degraded areas is poorly understood. We used the largest forest offset scheme in the world, which is part of the Brazilian Forest Code, to explore how implementation at different spatial scales may affect the outcome in terms of the area of avoided deforestation and area of regrowth. We employed a numerical simulation of trade between buyers (i.e., those who need to offset past deforestation) and sellers (i.e., landowners with exceeding native vegetation) in the Brazilian Amazon to estimate potential avoided deforestation and regrowth at different spatial scales of implementation. Allowing offsets over large spatial scales led to an area of avoided deforestation 12 times greater than regrowth, whereas restricting offsets to small spatial scales led to an area of regrowth twice as large as avoided deforestation. The greatest total area (avoided deforestation and regrowth combined) was conserved when the spatial scale of the scheme was small, especially in locations that were highly deforested. To maximize conservation gains from avoided deforestation and regrowth, the design of the Brazilian forest-offset scheme should focus on restricting the spatial scale in which offsets occur. Such a strategy could help ensure conservation benefits are localized and promote the recovery of degraded areas in the most threatened forest landscapes.
