On the carbon additionality of working forests

Bin Mei, Micah Ezekiel, Changyou Sun and Yanshu Li

Forestry Economics Review, 2025, vol. 7, issue 1, 23-34

Abstract: Purpose - Using a 62,742-ha working forest in New Brunswick, Canada, we examine the benefit and cost of carbon additionality at the landscape level. Design/methodology/approach - The baseline scenario is set to maximize timber profit over a 100-year planning period, whereas the carbon scenario is set to have a 5- or 10-year rotation extension. Findings - At a carbon price of $8/tCO2e, the benefit of additional carbon sequestration from the working forest cannot offset its cost. For the benefit-cost ratio to be one, the respective break-even price needs to be $21/tCO2e for the 5-year rotation extension and $25/tCO2e for the 10-year rotation extension. Originality/value - This study analyzes the carbon additionality and economics of working forests at the 50–100 thousand hectare scale. Specifically, we examine the change in benefit and cost between a baseline scenario of timber management only and a scenario of rotation extension for both timber and carbon sequestration.

Keywords: Climate change; Carbon credits; Timberland investment; Nature-based solutions; Faustmann model (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ferpps:fer-07-2024-0008

DOI: 10.1108/FER-07-2024-0008

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