Bioenergy from Mountain Pine Beetle Timber and Forest Residuals: A Cost Analysis

Abstract

INTRODUCTIONThe outbreak of mountain pine beetle (MPB) (Dendrocutonus ponderosae Hopkins) in the forests of central British Columbia (BC) is unprecedented in recorded history. Surveys indicate that over 17 million hectares (ha) of forest have been infested, and recent forecasts suggest that by 2021, 61% of the mature pine in BC could be killed (Natural Resources Canada 2011). In light of this catastrophic infestation and the associated projected fall down in harvests of timber for traditional forest products, there has been much interest in

Protecting Timber Supply on Public Land in Response to Catastrophic Natural Disturbance: A Principal-Agent Problem

“…We find throughout the analysis that lumber production subsidizes harvesting of bushchips for bio-energy. This subsidy is over and above any explicit subsidies to encourage bio-energy, particularly biomass burning for electricity production, a result consistent with Niquidet et al (2012). If insufficient lumber is recoverable from the pine or non-pine species in a stand, the stand will be left in the timber portfolio as it has little economic value.…”

“…The model can easily be modified to include multiple additional geographic zones that would enable us to explore the implications of variable transportation costs and shelf life as a function of location; this is left to future research (although see Niquidet et al 2012). This could affect the conclusions significantly and thus policy related to the pine beetle.…”

“…However, studies examining the use of damaged timber for bio-energy have raised issues concerning the high costs of hauling fiber located at increasing distances from bio-energy facilities (Niquidet et al 2012;Stennes et al 2010;Kumar et al 2008;Stennes and McBeath 2006). Meanwhile, lumber values depend on the length of time between initial attack and the time a tree is no longer usable for dimensional lumber, which is known as the shelf life.…”

Economic consequences of increased bioenergy demand

“…This leads to an increase in the demand for sawmill residuals that, in turn, leads to somewhat greater output of lumber and increased demand for logs. It will also increase the demand for roadside wastes associated with harvest operations, but whether this increases removal of such wastes is questionable and a separate issue not considered here (see Niquidet et al 2012). More importantly, an increase in the demand for wood pellets will result in the re-direction of residual fibre away from particleboard, fibreboard and pulp production to its use in coal plants (Stennes et al 2010).…”

Economic analysis of forest insect pests in Canada

“…Using a regional wood fibre allocation model, Stennes et al (2010) showed that expanded bioenergy production in British Columbia would not use standing MPB timber directly but instead would tend to use residuals from the primary forest sector, which had the potential to harm existing users of this fibre (e.g., pulp and pellet mills) by bidding up the price of this supply. Niquidet et al (2012) investigated the feasibility of a large wood biomass-fired power plant designed to employ the beetle-killed pine in the Quesnel Forest District, a region at the heart of the MPB outbreak. The focus of their analysis was feedstock costs and showed that average delivered feedstock costs would increase significantly over the life of an electricity power generating facility.…”