Bioenergy plantations or long-term carbon sinks? – A model based analysis

In order to mitigate climate change bio-productive land may be used mainly in two ways: afforestation with long-rotation forests with the primary aim to act as carbon sinks, and short-rotation forests that are used for energy purposes and thereby replace fossil fuels. Under an ambitious climate target, land that may be used for both bioenergy plantations and long-rotation forests, are likely to be scarce, and thereby competition between long-rotation forests and bioenergy plantations can be expected. The goal of the study is to analyze the cost-effectiveness of bioenergy plantations versus long-rotations forests aimed at capturing and storing carbon. The study is performed by solving and analyzing a linear optimization model that links the energy system, an afforestation sector and the pulp and timber market. Many earlier studies tend to suggest that long-rotation forests offer lower costs per ton of CO₂ avoided. Our study, however, shows that long-rotation forests for the purpose of carbon sequestration will not be cost-effective in the long run under a stringent climate policy. Thus, economic efficiency considerations tend to support short-rotation plantations for high carbon prices. The reason for this is that scarcity of land increases the opportunity cost of land, a feature which is generally not captured in static near-term analysis, but it is captured in a dynamic model like ours. For less stringent carbon targets long-rotation forests, that are harvested and sold as timber are cost-effective during a transient phase.