Financial and Management Implications of Producing Bioenergy in Upland Oak Stands in Kentucky

Abstract

Wood-based bioenergy or energywood has been suggested as an alternative to various fossil-fuel-based energy sources. While a variety of studies have investigated some economic aspects of forest-based bioenergy throughout the United States, none have yet examined the profitability of forest-based bioenergy from a landowner perspective in the Central Hardwood Forest Region. This study assesses how a forest-based bioenergy market would impact the optimal rotation age, the mix of forest products produced, and the potential financial return from typical mixed hardwood nonindustrial private forest (NIPF) lands in Kentucky. Results indicate that producing woody biomass for energy alongside other traditional forest products substantially decreases rotation age and increases the financial returns to the landowner. The reduction in rotation age is substantial enough that there could be fairly large changes in the product mix obtained from a typical mixed hardwood stand in the region. This result indicates that policies aimed at regulating the forest-based bioenergy market should take the potential for significant changes in forest management into account.