Potential complementarity between forest carbon sequestration incentives and biomass energy expansion

Area of Science:

• Forestry science
• Climate change mitigation
• Bioenergy policy

Background:

• Growing literature on the forest sector's role in climate action through carbon sequestration and bioenergy.
• Limited research on interactions between carbon sequestration incentives and bioenergy expansion policies in forestry.

Purpose of the Study:

• To develop a conceptual model for evaluating forest carbon sequestration and bioenergy policies as complements or substitutes.
• To assess terrestrial carbon changes under various combinations of carbon sequestration price incentives and forest bioenergy expansion.

Main Methods:

• Development of a simple conceptual model.
• Application of a dynamic structural model of the global forest sector.
• Simulation of different policy combinations and their impact on carbon sequestration and bioenergy.

Main Results:

• Forest bioenergy expansion complements carbon sequestration policies in the near- to medium-term, lowering abatement costs and enhancing mitigation.
• By the end of the century, these policies become substitutes, with bioenergy expansion increasing carbon sequestration costs.
• This shift is driven by increased pulpwood demand and prices, influencing forest management and harvest levels.

Conclusions:

• The interplay between forest bioenergy and carbon sequestration policies is dynamic, shifting from complementary to substitutive over time.
• Policy design must consider long-term impacts on forest management, harvest levels, and overall climate mitigation effectiveness.
• Understanding these interactions is crucial for optimizing the forest sector's contribution to climate action goals.