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Related Experiment Videos

Predicting the deforestation-trend under different carbon-prices.

Georg E Kindermann1, Michael Obersteiner, Ewald Rametsteiner

  • 1International Institute for Applied Systems Analysis, Laxenburg, Austria. kinder@iiasa.ac.at

Carbon Balance and Management
|December 8, 2006
PubMed
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Financial incentives can significantly reduce deforestation by making forest retention economically viable. High incentive payments or carbon taxes are needed, with a combined approach potentially offering a sustainable solution to protect global carbon stocks.

Area of Science:

  • Environmental Economics
  • Forestry Science
  • Climate Change Mitigation

Background:

  • Global forest biomass carbon stocks are declining annually due to deforestation and degradation.
  • Forest expansion in the extra-tropical north partially offsets these losses.
  • Innovative financial mechanisms are crucial for reducing deforestation.

Purpose of the Study:

  • To estimate the impact of carbon price incentive schemes and payment modalities on deforestation.
  • To analyze the effectiveness of different financial mechanisms in reducing forest loss.

Main Methods:

  • Utilized a spatially explicit integrated biophysical and socio-economic land use model.
  • Simulated baseline scenarios and the effects of incentive payments and carbon taxes on deforestation rates.

Related Experiment Videos

  • Quantified the economic costs and carbon release under various scenarios.

    • Main Results:

    • Projected loss of 200 million hectares of forest by 2025, releasing 17.5 GtC.
    • Estimated 500 million hectares of forest loss and 45 GtC release over 100 years.
    • Incentives of $6/tC reduced deforestation by 50% at an annual cost of $34 billion; a $12/tC carbon tax also halved deforestation.

    Conclusions:

    • Financial mechanisms are essential to make forest retention economically competitive with alternative land uses.
    • High incentive payments are required for significant deforestation reduction.
    • A combination of incentive payments and taxes may provide a viable solution, potentially supporting agricultural productivity with tax revenues.