Economics of afforestation for carbon sequestration in western Canada

Abstract

The Kyoto Accord on climate change requires developed countries to achieve CO 2 -emissions reduction targets, but permits them to charge uptake of carbon (C) in terrestrial (primarily forest) ecosystems against emissions. Countries such as Canada hope to employ massive afforestation programs to achieve Kyoto targets. One reason is that foresters have identified large areas that can be afforested. In this paper, we examine this forestry option, focusing on the economics of afforestation in western Canada. In particular, we develop marginal C uptake curves and show that much less land is available for afforestation than would be the case if economics is ignored. We conclude that, while afforestation is a feasible weapon in the greenhouse policy arsenal, it might not be as effective on an economic basis as many forest-sector analysts make out. Key words: Climate change, economics of afforestation, Kyoto Accord