An Economic Valuation of Forest Carbon Sink in a Resource-Based City on the Loess Plateau

Xinlei Liu, Ya Yang, Ping Shen and Xingyu Liu ()
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Xinlei Liu: School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710061, China
Ya Yang: Institute of Earth Sciences, China University of Geosciences, Beijing 100083, China
Ping Shen: Beijing KD TsingYuan Ecological Technology Co., Ltd., Beijing 100083, China
Xingyu Liu: Institute of Earth Sciences, China University of Geosciences, Beijing 100083, China

Sustainability, 2025, vol. 17, issue 13, 1-32

Abstract: Forest carbon sink (FCS) is essential for achieving carbon neutrality and supporting sustainable development in ecologically fragile, resource-based cities such as those on the Loess Plateau. Despite the success of national afforestation programs, economic valuations of FCS at the city level remain limited. This study develops an integrated framework combining carbon stock estimation, regional carbon pricing, and net present value (NPV)-based valuation. Using Shenmu City in Shaanxi Province as a case study, forest carbon stocks from 2010 to 2023 are estimated based on the 2006 IPCC Guidelines. Future stocks (2024–2060) are projected using the GM (1,1) model. A dynamic pricing mechanism with a government-guaranteed floor price is applied under three offset scenarios (5%, 10%, 15%). The results show that Shenmu’s forest carbon stock could reach 20.67 million tonnes of CO 2 by 2060, and under a 15% offset scenario, the peak NPV reaches CNY 4.02 billion. Higher offset ratios increase FCS value by 18–22%, reflecting the growing scarcity of carbon credits. The pricing model improves market stability and investor confidence. This study provides a replicable approach for carbon sink valuation in semi-arid areas and offers policy insights aligned with SDG 13 (Climate Action) and SDG 15 (Life on Land).

Keywords: Forest carbon sink; Loess Plateau; economic valuation; carbon pricing; resource-based cities (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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