Assessing economic benefits and costs of carbon sinks in boreal rotation forestry

Abstract

We study the optimal enhancement of forest carbon sinks via forest management changes in boreal even-aged Scots pine (Pinus sylvestris) forests. The economic–ecological stand-level optimization model integrates a statistical–empirical individual-tree growth model with a comprehensive model for carbon in living trees, wood products, and soil. We use reinforcement learning to optimize for rotation length, thinning timing, and thinning intensity. Carbon dioxide (CO₂) pricing has a notable effect on the optimal solutions and on the corresponding CO₂ flows and carbon stocks. Under a 1% interest rate, increasing the CO₂ price from zero to €100 increases the discounted carbon sink by 83% and the total steady-state carbon stock by 122%. Increasing the CO₂ price decreases the economic significance of thinning, and, with a high enough CO₂ price, the stand is harvested only with clear-cuts, which are further postponed by CO₂ price increases. Decreasing stand volume or total C stock cannot be taken as a sign of an overly mature stand. Depending on the CO₂ price and interest rate, the economic benefit–cost ratio of additional carbon sinks via forest management changes varies between 1.9 and 3.7. Overall, the results reveal a high potential to increase the role of boreal managed forests in climate change mitigation.