Accounting for risk in valuing forest carbon offsets

Matthew D Hurteau,George W Koch,Bruce A Hungate

doi:10.1186/1750-0680-4-1

Abstract

BackgroundForests can sequester carbon dioxide, thereby reducing atmospheric concentrations and slowing global warming. In the U.S., forest carbon stocks have increased as a result of regrowth following land abandonment and in-growth due to fire suppression, and they currently sequester approximately 10% of annual US emissions. This ecosystem service is recognized in greenhouse gas protocols and cap-and-trade mechanisms, yet forest carbon is valued equally regardless of forest type, an approach that fails to account for risk of carbon loss from disturbance.ResultsHere we show that incorporating wildfire risk reduces the value of forest carbon depending on the location and condition of the forest. There is a general trend of decreasing risk-scaled forest carbon value moving from the northern toward the southern continental U.S.ConclusionBecause disturbance is a major ecological factor influencing long-term carbon storage and is often sensitive to human management, carbon trading mechanisms should account for the reduction in value associated with disturbance risk.

Highlights

Forests can sequester carbon dioxide, thereby reducing atmospheric concentrations and slowing global warming
Regrowth due to land abandonment and in-growth due to fire suppression have resulted in an increase in U.S forest carbon stocks [2], sequestering approximately 10% of annual U.S emissions [3]
We use the fire regime condition class departure index (FRCC_DEP) and mean fire return interval data products developed for the LANDFIRE project [10] to discount the market value of forest carbon as a function of the risk of loss due to wildfire

Summary

Introduction

Forests can sequester carbon dioxide, thereby reducing atmospheric concentrations and slowing global warming. In the U.S, forest carbon stocks have increased as a result of regrowth following land abandonment and in-growth due to fire suppression, and they currently sequester approximately 10% of annual US emissions This ecosystem service is recognized in greenhouse gas protocols and cap-and-trade mechanisms, yet forest carbon is valued regardless of forest type, an approach that fails to account for risk of carbon loss from disturbance. In addition to reforestation, increasing carbon density and reducing emissions from disturbances (fire, insect outbreaks) are strategies for using forests to slow the rise of atmospheric carbon dioxide (CO2) [4] Compared to these "upside" perspectives, risks have largely been ignored when considering investment in forest carbon management. We show that the (page number not for citation purposes)

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Results

Conclusion