Forest management and the economics of carbon storage: the nonfinancial component

Globally, forests fix and store significant amounts of carbon. This attribute aids in reducing the buildup of atmospheric CO₂. Forest management can increase biomass productivity on lands suitable for forest growth thereby enhancing the uptake of CO₂ by terrestrial ecosystems. Worldwide, however, only about 10 % of the 3.6 billion ha of forests are currently under management, suggesting a considerable potential for expansion. Before national and international policy makers commit to increasing the level of forest management, they need information on the benefits and costs of forest management for this objective. Financial evaluations of forest management benefits and costs are not uncommon. But nonfinancial considerations are often not considered in such analyses, and they can change resulting conclusions. Using a series of 30 plantation regimes from around the world, this paper demonstrates the influence of including the nonfinancial cost (i.e. opportunity cost) of forest growing stock in selecting the most favorable opportunities for investments in carbon storage through forest management.