An Econometric Analysis of the Costs of Sequestering Carbon in Forests

Plantinga, Andrew J.; Mauldin, Thomas; Miller, Douglas J.

doi:10.2307/1244326

Cited by 193 publications

(108 citation statements)

References 20 publications

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“…These include option value related to holding land in its current use, as well as private nonmarket benefits (e.g., recreation) that landowners may derive from land in particular uses. Typically, marginal cost estimates from econometric analyses are higher than those produced with bottom-up engineering or optimization methods (Lubowski et al 2006, Plantinga et al 1999, Stavins 1999). …”

Section: Following Moulton and Richards Economists Have Provided A Nmentioning

confidence: 99%

New cost estimates for carbon sequestration through afforestation in the United States

Nielsen¹,

Plantinga²,

Alig³

2014

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If you wish to file a Civil Rights program complaint of discrimination, complete the USDA Program Discrimination Complaint Form (PDF), found online at http://www.ascr.usda.gov/ complaint_filing_cust.html, or at any USDA office, or call (866) 632-9992 to request the form. You may also write a letter containing all of the information requested in the form. Send your completed complaint form or letter to us by mail at U. This report provides new cost estimates for carbon sequestration through afforestation in the United States. We extend existing studies of carbon sequestration costs in several important ways, while ensuring the transparency of our approach. We clearly identify all components of our cost estimates so that other researchers can reconstruct our results as well as use our data for other purposes. Our cost estimates have five distinguishing features: (1) we estimate costs for each county in the contiguous United States; (2) we include afforestation of rangeland, in addition to cropland and pasture; (3) our opportunity cost estimates account for capitalized returns to future development (including associated option values) in addition to returns to agricultural production; (4) we develop a new set of forest establishment costs for each county; and (5) we incorporate data on Holdridge life zones to limit afforestation in locations where temperature and moisture availability prohibit forest growth. We find that at a carbon price of $50/ton, approximately 200 million tons of carbon would be sequestered annually through afforestation. At a price of $100/ton, an additional 100 million tons of carbon would be sequestered each year. Our estimates closely match those in earlier econometric studies for relatively low carbon prices, but diverge at higher carbon prices. Accounting for climatic constraints on forest expansion has important effects on cost estimates.

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Section: Following Moulton and Richards Economists Have Provided A Nmentioning

confidence: 99%

New cost estimates for carbon sequestration through afforestation in the United States

Nielsen¹,

Plantinga²,

Alig³

2014

Self Cite

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“…In contrast, we calibrate the marginal impact of potential carbon payments on deforestation using the empirical relationship between the pattern of observed deforestation in a historical period and spatial variation in the benefits and costs of converting land from forest to agriculture. Using this "revealed preference" approach to estimate the impact of potential payments based on evidence from actual land-use decisions implicitly accounts for the richer set of factors that affect land-use in practice (15)(16)(17)(18). Second, most previous studies have modeled land-use responses to variations in a single parameter: the carbon price.…”

mentioning

confidence: 99%

Structuring economic incentives to reduce emissions from deforestation within Indonesia

Busch

Lubowski

Godoy

et al. 2012

Proc. Natl. Acad. Sci. U.S.A.

108

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We estimate and map the impacts that alternative national and subnational economic incentive structures for reducing emissions from deforestation (REDD+) in Indonesia would have had on greenhouse gas emissions and national and local revenue if they had been in place from 2000 to 2005. The impact of carbon payments on deforestation is calibrated econometrically from the pattern of observed deforestation and spatial variation in the benefits and costs of converting land to agriculture over that time period. We estimate that at an international carbon price of $10/ tCO 2 e, a "mandatory incentive structure," such as a cap-and-trade or symmetric tax-and-subsidy program, would have reduced emissions by 163-247 MtCO 2 e/y (20-31% below the without-REDD+ reference scenario), while generating a programmatic budget surplus. In contrast, a "basic voluntary incentive structure" modeled after a standard payment-for-environmental-services program would have reduced emissions nationally by only 45-76 MtCO 2 e/y (6-9%), while generating a programmatic budget shortfall. By making four policy improvements-paying for net emission reductions at the scale of an entire district rather than site-by-site; paying for reductions relative to reference levels that match business-as-usual levels; sharing a portion of district-level revenues with the national government; and sharing a portion of the national government's responsibility for costs with districts-an "improved voluntary incentive structure" would have been nearly as effective as a mandatory incentive structure, reducing emissions by 136-207 MtCO 2 e/y (17-26%) and generating a programmatic budget surplus.climate change | climate policy | land-use change | reducing emissions from deforestation and forest degradation A n emerging international climate policy mechanism called REDD+ would offer payments to developing countries that voluntarily reduce greenhouse gas emissions from deforestation below internationally agreed reference levels (1). Individual forested countries would decide upon the specific set of policies and measures to implement to achieve nationwide emission reductions. Accounting for these net emission reductions would ultimately take place at the national level, making national governments responsible for any internal geographical shifts of emissions (leakage), and providing incentives for systemic policy actions. However, although governments would receive payments under REDD+, it is actors at the regional, provincial, local, or household (subnational) scales who are directly responsible for many land-use change decisions. Thus, the effectiveness of REDD+ in reducing emissions and generating revenue will depend upon how national governments structure economic incentives so that subnational actors will be encouraged to reduce emissions and discouraged from increasing emissions.Emission-reduction policy in the energy and industrial sectors of developed countries has commonly been approached through mandatory, market-based incentive structures, such as cap-andtrade...

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“…Land is enrolled for a period of twenty years, and all cropland and pasture land is eligible for payment. This policy scenario reflects a payment design that is similar to other land retirement programs such as the CRP that are currently being used in agriculture and is comparable to payments schemes utilized in other studies of C sequestration (Plantinga, Mauldin, and Miller, 1999;Stavins, 1982).…”

Section: Simulation Of Soil C Levels and Costsmentioning

confidence: 99%

Big Sky Carbon Sequestration Partnership

Capalbo¹

2005

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An Econometric Analysis of the Costs of Sequestering Carbon in Forests

Cited by 193 publications

References 20 publications

New cost estimates for carbon sequestration through afforestation in the United States

New cost estimates for carbon sequestration through afforestation in the United States

Structuring economic incentives to reduce emissions from deforestation within Indonesia

Big Sky Carbon Sequestration Partnership

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