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Using Markets for Woody Biomass Energy to Sequester Carbon in Forests

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  • Alice Favero
  • Robert Mendelsohn

Abstract

Although storing more carbon in forests should be part of an efficient mitigation program, it is unclear how to create effective incentives to make this happen. The literature largely has focused on giving landowners direct incentives to store carbon. This paper explores an alternative mechanism to increase forest carbon sequestration by creating a market for wood bioenergy. By raising the value of wood, the program encourages landowners to convert vast amounts of land to forest, which incidentally increases forest carbon. By providing an indirect subsidy on woody biomass, governments can give even more incentive to reward this carbon sequestration.

Suggested Citation

  • Alice Favero & Robert Mendelsohn, 2014. "Using Markets for Woody Biomass Energy to Sequester Carbon in Forests," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 1(1), pages 75-95.
    • Handle: RePEc:ucp:jaerec:doi:10.1086/676033
    DOI: 10.1086/676033
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    Cited by:

    1. Baker, J.S. & Wade, C.M. & Sohngen, B.L. & Ohrel, S. & Fawcett, A.A., 2019. "Potential complementarity between forest carbon sequestration incentives and biomass energy expansion," Energy Policy, Elsevier, vol. 126(C), pages 391-401.
    2. Miguel Riviere & Sylvain Caurla & Philippe Delacote, 2020. "Evolving Integrated Models From Narrower Economic Tools : the Example of Forest Sector Models," Post-Print hal-02512330, HAL.
    3. Alice Favero & Robert Mendelsohn & Brent Sohngen, 2017. "Using forests for climate mitigation: sequester carbon or produce woody biomass?," Climatic Change, Springer, vol. 144(2), pages 195-206, September.
    4. Tahvonen, Olli & Rautiainen, Aapo, 2017. "Economics of forest carbon storage and the additionality principle," Resource and Energy Economics, Elsevier, vol. 50(C), pages 124-134.
    5. Randall W. Jackson & Amir Borges Ferreira Neto & Elham Erfanian & Péter Járosi, 2019. "Woody Biomass Processing and Rural Regional Development," Economic Development Quarterly, , vol. 33(3), pages 234-247, August.
    6. Favero, Alice & Mendelsohn, Robert & Sohngen, Brent, 2016. "Carbon Storage and Bioenergy: Using Forests for Climate Mitigation," MITP: Mitigation, Innovation and Transformation Pathways 232215, Fondazione Eni Enrico Mattei (FEEM).
    7. Johnston, Craig M.T. & van Kooten, G. Cornelis, 2016. "Global trade impacts of increasing Europe's bioenergy demand," Journal of Forest Economics, Elsevier, vol. 23(C), pages 27-44.
    8. Rong Li & Brent Sohngen & Xiaohui Tian, 2022. "Efficiency of forest carbon policies at intensive and extensive margins," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(4), pages 1243-1267, August.
    9. Steffen Fahr & Julian Powell & Alice Favero & Anthony J. Giarrusso & Ryan P. Lively & Matthew J. Realff, 2022. "Assessing the physical potential capacity of direct air capture with integrated supply of low‐carbon energy sources," Greenhouse Gases: Science and Technology, Blackwell Publishing, vol. 12(1), pages 170-188, February.
    10. Kim, Sei Jin & Baker, Justin S. & Sohngen, Brent L. & Shell, Michael, 2018. "Cumulative global forest carbon implications of regional bioenergy expansion policies," Resource and Energy Economics, Elsevier, vol. 53(C), pages 198-219.
    11. Hans Lööf & Maziar Sahamkhadam & Andreas Stephan, 2023. "Incorporating ESG into Optimal Stock Portfolios for the Global Timber & Forestry Industry," Journal of Forest Economics, now publishers, vol. 38(2), pages 133-157, June.
    12. Roger A. Sedjo & Brent Sohngen & Anne Riddle, 2015. "Land Use Change, Carbon, And Bioenergy Reconsidered," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 6(01), pages 1-14.
    13. Withers, Mitch R. & Malina, Robert & Barrett, Steven R.H., 2015. "Carbon, climate, and economic breakeven times for biofuel from woody biomass from managed forests," Ecological Economics, Elsevier, vol. 112(C), pages 45-52.
    14. Eriksson, Mathilda & Brännlund, Runar & Lundgren, Tommy, 2018. "Pricing forest carbon: Implications of asymmetry in climate policy," Journal of Forest Economics, Elsevier, vol. 32(C), pages 84-93.
    15. Henderson, Jesse D. & Parajuli, Rajan & Abt, Robert C., 2020. "Biological and market responses of pine forests in the US Southeast to carbon fertilization," Ecological Economics, Elsevier, vol. 169(C).

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