How Cost-Effective Is Forestry for Climate Change Mitigation?

Abstract

Cost-effectiveness analysis is important in focusing policies on minimising the costs of meeting climate change mitigation targets and other policy goals. This chapter provides a review of previous cost-effectiveness estimates of forestry options and underlying approaches, focusing especially upon UK studies, and setting the estimates in the context of those for other mitigation measures. Methodological issues such as discounting affecting estimates are discussed and existing evidence gaps highlighted. For the UK, research gaps include evidence on impacts of afforestation on forest soil carbon balance, on comprehensive GHG balances for forest stands, on carbon stock changes during early tree growth and once stands reach maturity, and carbon substitution (or displacement) benefits. Better evidence is also needed on opportunity costs and on leakage effects. Existing evidence indicates that forestry options are generally cost-effective compared with a range of alternatives. Whether this conclusion holds in particular cases will vary between projects and regions, as well as being dependent upon the approach adopted. To the extent that cost-effectiveness estimates depend upon the methodology adopted and benchmark used, future comparisons could benefit from greater methodological transparency and consistency. Not only may forestry options be relatively cost-effective but, given the challenging task of reaching current targets, they are likely to be critical if existing international objectives on climate change mitigation are to be met. G.