Abstract
The goals of this study were to promote restoration of forest ecosystems through fire hazard reduction treatments and to evaluate potential economic benefits of carbon credits to the Navajo Nation. We used the historic Navajo Nation's Continuous Forest Inventory data to calibrate the Forest Vegetation Simulator (FVS) with growth increments and used the FVS to run simulations that encompass the next 50 years. We calculated C revenues using two carbon accounting approaches: (1) reduced buffer pool under the Climate Action Reserve protocol and (2) increased C stocks based on with-and-without analysis. We investigated nine C price scenarios, including constant- and rising-price trajectories; performed discounted cash flow analyses; and calculated net present worth (NPW). When timber was the only marketable output, using a real alternative rate of return (ARR) of 4%, the NPW of target basal area (BA) 40, 70, and 100 ft2/ac were -$144.89, -$267.98, and -$308.57/ac, respectively. When both timber and C were marketable outputs, with a C price of $3/ton, the NPW of target BAs of 40, 70, and 100 ft2/ac were increased to -$119.26, -$256.83, and -$306.31, respectively, under the first accounting approach, and were increased to $168.62, -$57.29, and -$184.09, respectively, under the second accounting approach. Our results indicate that C accounting method, C price, and landowner's ARR affect forest landowner's profitability in participating in the C market.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 37-45 |
| Number of pages | 9 |
| Journal | Western Journal of Applied Forestry |
| Volume | 26 |
| Issue number | 1 |
| State | Published - Jan 2011 |
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Keywords
- Carbon accounting method
- Ecological restoration treatment
- Forest project's reversal risk rating
- Native American tribal forests
- Net present worth analysis
ASJC Scopus subject areas
- Forestry
- Plant Science
Cite this
The economic value of selling carbon credits from restored forests : A case study from the navajo nation's tribal forests. / Huang, Ching-Hsun; Sorensen, Christopher.
In: Western Journal of Applied Forestry, Vol. 26, No. 1, 01.2011, p. 37-45.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - The economic value of selling carbon credits from restored forests
T2 - A case study from the navajo nation's tribal forests
AU - Huang, Ching-Hsun
AU - Sorensen, Christopher
PY - 2011/1
Y1 - 2011/1
N2 - The goals of this study were to promote restoration of forest ecosystems through fire hazard reduction treatments and to evaluate potential economic benefits of carbon credits to the Navajo Nation. We used the historic Navajo Nation's Continuous Forest Inventory data to calibrate the Forest Vegetation Simulator (FVS) with growth increments and used the FVS to run simulations that encompass the next 50 years. We calculated C revenues using two carbon accounting approaches: (1) reduced buffer pool under the Climate Action Reserve protocol and (2) increased C stocks based on with-and-without analysis. We investigated nine C price scenarios, including constant- and rising-price trajectories; performed discounted cash flow analyses; and calculated net present worth (NPW). When timber was the only marketable output, using a real alternative rate of return (ARR) of 4%, the NPW of target basal area (BA) 40, 70, and 100 ft2/ac were -$144.89, -$267.98, and -$308.57/ac, respectively. When both timber and C were marketable outputs, with a C price of $3/ton, the NPW of target BAs of 40, 70, and 100 ft2/ac were increased to -$119.26, -$256.83, and -$306.31, respectively, under the first accounting approach, and were increased to $168.62, -$57.29, and -$184.09, respectively, under the second accounting approach. Our results indicate that C accounting method, C price, and landowner's ARR affect forest landowner's profitability in participating in the C market.
AB - The goals of this study were to promote restoration of forest ecosystems through fire hazard reduction treatments and to evaluate potential economic benefits of carbon credits to the Navajo Nation. We used the historic Navajo Nation's Continuous Forest Inventory data to calibrate the Forest Vegetation Simulator (FVS) with growth increments and used the FVS to run simulations that encompass the next 50 years. We calculated C revenues using two carbon accounting approaches: (1) reduced buffer pool under the Climate Action Reserve protocol and (2) increased C stocks based on with-and-without analysis. We investigated nine C price scenarios, including constant- and rising-price trajectories; performed discounted cash flow analyses; and calculated net present worth (NPW). When timber was the only marketable output, using a real alternative rate of return (ARR) of 4%, the NPW of target basal area (BA) 40, 70, and 100 ft2/ac were -$144.89, -$267.98, and -$308.57/ac, respectively. When both timber and C were marketable outputs, with a C price of $3/ton, the NPW of target BAs of 40, 70, and 100 ft2/ac were increased to -$119.26, -$256.83, and -$306.31, respectively, under the first accounting approach, and were increased to $168.62, -$57.29, and -$184.09, respectively, under the second accounting approach. Our results indicate that C accounting method, C price, and landowner's ARR affect forest landowner's profitability in participating in the C market.
KW - Carbon accounting method
KW - Ecological restoration treatment
KW - Forest project's reversal risk rating
KW - Native American tribal forests
KW - Net present worth analysis
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UR - http://www.scopus.com/inward/citedby.url?scp=78651413147&partnerID=8YFLogxK
M3 - Article
VL - 26
SP - 37
EP - 45
JO - Western Journal of Applied Forestry
JF - Western Journal of Applied Forestry
SN - 0885-6095
IS - 1
ER -