Journal of Forest Economics > Vol 17 > Issue 4

Rewarding carbon sequestration in South-Western French forests: A costly operation?

Guillaume Pajot, ,
Suggested Citation
Guillaume Pajot (2011), "Rewarding carbon sequestration in South-Western French forests: A costly operation?", Journal of Forest Economics: Vol. 17: No. 4, pp 363-377.

Published: 0/12/2011
© 0 2011 Guillaume Pajot
JEL Codes:C61C63Q23Q54Q56Q57Q58
Carbon sequestrationForestsCost effectivenessIncentivesRotation lengthsCarbon stocksMarginal costs

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The extension of rotation lengths in forests has been proposed as an option for increasing carbon storage and contributing to climate change mitigation. This paper presents the results of a case study conducted on forests located in the southwest of France. The aim of this research was to assess the cost effectiveness of a subsidy/tax system on carbon fluxes. First, it is shown that such a mechanism leads forest owners to extend rotation lengths. However, cost effectiveness analysis shows that: (1) marginal social costs are more expensive than the private marginal costs of carbon sequestration; (2) marginal costs are higher when carbon stocks are discounted, ranging from 170.1€/tC to 719.8€/tC with discounted carbon stocks; and from 38.8€/tC to 78.4€/tC with undiscounted carbon stocks; (3) marginal costs are in the range of measures of the social value of carbon for France; (4) marginal costs increase with timber prices and increase with discount rate.