Beyond Monetary Cost-Benefit Analyses: Combining Economic, Environmental and Social Analyses of Short Rotation Coppice Poplar Production in Slovakia

Daniela Fürtner,Enrique Alejandro Perdomo Echenique,Stefan J Hörtenhuber,Franziska Hesser,Peter Schwarzbauer

doi:10.3390/f13020349

Daniela Fürtner, Enrique Alejandro Perdomo Echenique + Show 3 more

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https://doi.org/10.3390/f13020349

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Abstract

Rising demand for bio-based products exerts a growing pressure on natural resources such as wood. Sustainable solutions are becoming increasingly important to meet the demand. In this study, 20-year poplar Short Rotation Coppice (SRC) plantations located in Western Slovakia are investigated with respect to (socio)-economic, environmental and social sustainability. The cost–benefit methodology is applied to assess the economic profitability of a switch from conventional annual crops (corn maize and winter rye) to perennial SRC. To compare economic profitability of the land management, net present value (NPV), payback time (PBT), internal rate of return (IRR) and benefit–cost ratio (BCR) are calculated. The study was enhanced by adopting the concept of regional value added to indicate the local value creation. The results for the three scenarios yield an NPV equal to 12,156 euros ha−1 for corn maize, 9763 euros ha−1 for winter rye and 2210 euros ha−1 with a PBT of 14.13 years for poplar SRC production. The regional value added for the corn maize scenario was estimated with 10,841 euros ha−1, the winter rye with 7973 euros ha−1 and the poplar SRC with 1802 euros ha−1. To appraise non-monetized social values, semi-structured interviews (N = 4) were conducted among experts familiar with SRC management in Eastern Europe. Non-monetary benefits for the stakeholder groups society, farmers or landowners and the industry were identified in terms of land fragmentation, carbon sequestration and an increase in biodiversity within the plantations, farm diversification and higher independency from wood markets. The relatively poor image of SRC, farmers or landowners having concerns about being tied on long-term contracts and legal restrictions may become obstacles in the establishment of SRC. For estimating the capability of carbon sequestration in SRC plantations the RothC model was utilized, resulting in the potential soil organic carbon (SOC) average increase of 29% during the 20 years. However, a transition in land use patterns must involve thorough considerations of all three pillars of sustainability to ensure long-term viability of the establishment.

Highlights

The policy-driven concept of bioeconomy in the European Union aims to cope with grand societal challenges [1,2]
This study aims to address this gap by conducting a Cost–Benefit Analysis and combining these findings with an analysis of environmental and social aspects of the establishment of Short Rotation Coppice (SRC) as a new land use form
The concepts of Net Present Value, Payback Time, Internal Rate of Return, Benefit-Cost Ratio and Regional Value Added are applied for the economic analyses of poplar wood production in Short Rotation Coppice (SRC) plantations located in Western Slovakia as a new form of land management, and scenario analyses of the typical previous annual land use practices, which are conventional winter rye and corn maize crops

Summary

Introduction

The policy-driven concept of bioeconomy in the European Union aims to cope with grand societal challenges [1,2]. Almost half of the entire Slovak territory is designated agricultural land [3,4] and 40% of the total land area is cultivated [5]. Merely 1,915,101 hectares of the total 2,379,101 hectares of agricultural land in Slovakia has been used for farming [6]; 51% of the arable land in Slovakia is suitable for maize production and 23% for canola cultivation. The highest share of arable land and coverage with permanent crops is located in the Western part of Slovakia. In Western Slovakia, grain maize and cereals production are the most widespread agricultural cultivation forms [8]. Agriculture, forestry and other land uses are among the main global emitters of greenhouse gases, responsible for around 23% of the total anthropogenic greenhouse gas emissions [9]. The rural regions in Eastern Europe are currently undergoing a demographical shift—the rural population is increasingly moving towards urban centers, and agricultural activities as well as farmlands are being abandoned, which was stated by Abolina and Luzadis [10], for example

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