Regional Impacts of a Program for Private Forest Carbon Offset Sales

Abstract

Abstract Policymakers are examining a wide range of alternatives for climate change mitigation, including carbon offset sales programs, to enhance sequestration in the forest sector. Under an offset sales program, on-the-ground forestry could change as a result of both afforestation and modifications in the management of existing forests. These effects could vary markedly by region in the United States because of differences in areas of agricultural land suitable for afforestation, forest carbon and volume growth characteristics, the structure of landownership, and forest industry concentration. Using a dynamic model of North American markets, our analysis of alternative carbon price levels suggests that the largest carbon increment response would come from changes in forest management: extending rotations, shifting silvicultural regimes, and reforestation to hardwood forest types (in some regions). Carbon payments could also stimulate a substantial afforestation response in eastern regions (North and South). Afforestation is particularly important in the North where timberland area could expand markedly. Much of the area would be planted to hardwoods, stemming the projected decline in hardwood forest types and growing stock volume.