Forests and carbon: An integrated modeling approach to investigate climate policies

Concern over the Earth's changing climate has largely focused on stemming the rising concentration of greenhouse gases (GHGs), particularly carbon dioxide (CO₂), in the atmosphere. Forests are known to be either a significant carbon sink or a potential carbon source depending on its use or state of growth. As such, the opportunity to manage forests to slow the rate of increase in atmospheric CO₂ levels is an important component in the menu of options aimed at stabilizing the global climate. In addition, the acceptance of forest sinks as a mitigation strategy at international climate forums has raised its political prominence, and is expected to lead to increased investments in the forestry sector.; The objective of this research is to provide an ecological and economic analysis of the impacts from CO₂ mitigation efforts using forest sinks. Design of the modeling approach in this study addresses numerous gaps in previous research. The study developed an integrated modeling framework which links a dynamic computable general equilibrium (CGE) model that has been refined with rich forest-related details with the Dynamic Timber Supply Model (DTSM), a partial equilibrium model of the global forestry sector with high levels of sophistication in its details of forest stocks, growth and harvests. The new integrated modeling framework is used to simulate the long-term impacts on the global economy from multilateral carbon sequestration policies.; Two forest carbon policy scenarios are simulated using the integrated model, both involving the use of carbon payments as incentives to encourage forestland owners to sequester additional carbon on their lands. The study finds that carbon payments can lead to sizeable land use shifts between the forest and agriculture sectors, have differential impacts on the storage of carbon in the temperate and tropical forest systems, and have the potential to sequester a substantial share of industrial carbon emissions over the next 50 years. The next steps in this on-going research are to apply FORGEM towards a wider range of carbon prices and policy incentives, and to refine the behavioral parameters to increase confidence in the model results.