Are forest landowners ready for woody energy crops? Preferences for afforestation programs in Southern Spain

Abstract

Landowners' attitudes towards energy crops are a keystone for the fulfillment of the European Union objectives of energy production (electrical, thermal and biofuels) from biomass in the next years. Economic instruments play a fundamental role to increase the participation of the landowners in renewable energy schemes. A discrete choice experiment was conducted using a mail survey to 268 private forest landowners from the Andalusia region (southern Spain). The aim was to examine forest landowners' willingness to implement afforestation schemes considering short rotation plantations based on woody energy crops (eucalyptus, paulownia and poplar) and traditional tree species (holm oak and pine). Results show that afforestation with holm oak is the preferred alternative followed by woody energy crops. According to the experiment results, the participation of about half of the Andalusian forest owners in a woody energy crops scheme would imply a public expenditure in incentives for this land use change of 265 million of euros, i.e. an unrealistic figure given the current institutional framework for renewables in Europe. Finally, it is shown that compensations to forest landowners are affected by the payment timeframe and that the discount rate implicitly used by landowners exceeds the 4% rate commonly used in forest economics literature.