Marginal cost of reducing greenhouse gas emissions in pasture recovery

William Jun Kimura and Elcio Ferreira Santos

Revista IPecege, 2016, vol. 2, issue 4

Abstract: The growing demand for food and environmental concerns have led government leaders to encourage the adoption of technologies that can sustainably increase food supply. The objective of this work is to value the mitigation of greenhouse gas emissions through pasture recovery using financing from the Low Carbon Agriculture Program credit line, employing the marginal cost of abatement tool. To achieve the proposed objectives, financial data from the Center for Advanced Studies in Applied Economics and the Brazilian Confederation of Agriculture and Livestock, as well as emissions data from the Intergovernmental Panel on Climate Change and the Low Carbon Agriculture Plan, were used to simulate the net annual costs and net emissions of current and abatement technologies, represented by low-technology livestock farming and livestock farming on recovered pasture, respectively. The financial and emission values ​​for livestock farming on recovered pasture were more favorable when compared to low-technology livestock farming. Considering these two factors, the marginal cost of abatement is -R$ 24.72 per tCO2 equivalent . Therefore, for every ton of carbon dioxide equivalent mitigated by pasture recovery, the livestock farmer has a financial result of R$ 24.72 more than if they continued with low-technology livestock farming. Thus, pasture recovery proves to be a practice that allows for increased food production in a way that is both environmentally and financially sustainable.

Keywords: Climate; Change (search for similar items in EconPapers)
Date: 2016
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