Simulated effects of mandatory versus voluntary participation in private forest carbon offset markets in the United States

Abstract

Assumptions regarding landowner participation, whether mandatory or voluntary, are an important determinant in evaluating the implications of a carbon offset sales program. We modify an existing intertemporal optimization model of the US forest and agriculture sectors to allow optional involvement of private forest land in a carbon offset market and compare these results to a case in which all private land is enrolled. Our analysis of these two cases and various CO2e price levels indicate different responses in carbon stock and flux, forest land area and management, forest product prices, and forest conditions. The results suggest that the cost of sequestering carbon in US forests, using either a voluntary or mandatory carbon offset sales program, may be substantially higher than suggested by earlier studies.