1. Ralph J. Alig, USDA Forest Service, PNW Research Station
Ownership Considerations For Forest Carbon Sequestration for the United States
Ralph J. Alig, USDA Forest Service, PNW Research Station
North American Forest and Ag GHG Modeling Conference—September 25, 2011
1) Sources of Support
USDA Forest Service
USEPA
The USDA Forest Service is one of several organizations involved in research to improve analysis of mitigation policies involving forestry
Acknowledgements also for OSU and core team
2) Talk to provide context along lines of ownership differences and lead in to Elizabeth’s talk

2. Outline of Talk
*Terrestrial Carbon Sequestration Across Sectors and Ownerships (“All Lands Approach”
*Land use and ownership in the United States
*Private Ownership: Land-Use Changes
*Public Forest Ownership
*Modeling Carbon Changes on Public Forest Lands
*Selected Research Needs (Modeling Gaps)
Landowner behavior and designing more effective incentives for inducing land use and land cover changes to help mitigate climate change by reducing net GHG emissions
In line with the all lands approach proposed by the Sec. of Agriculture, we need to use a cross boundary approach in our adaptation and mitigation analyses to examine opportunities across ownerships. Elizabeth Reinhardt will follow my talk and concentrate on USDA Forest Service scorecard analyses for that agency's public lands, and I will set the stage with a broader all-lands talk that summarizes some public forestland findings at regional and national scales. In addition, I will point to findings about private landowner behavior, in the context of designing more effective incentives for inducing land use and land cover changes to help mitigate climate change by reducing net GHG emissions. Past fora have focused mainly on private lands, for example showing substantial mitigation opportunities involving afforestation in the Corn Belt and South.

3. Modeling components
Land-use modeling, e.g., deforestation for agricultural use
Forest inventory (e.g., area and volumes per acre) and updating through time
Forest management and investment (e.g., precommercial thinning), and natural disturbances
Timber harvest (link to Eric White’s talk about forest-based bioenergy)
Forest and product carbon accounting
Regeneration Path (link to Greg Latta’s talk about voluntary actions)
Forest carbon studies are other earlier FASOM research on mitigation
In addition to mitigation analyses, the model has also been used to examine
Impacts of climate change
Adaptation
The model has been used to investigate climate change impacts, adaptation, and mitigation involving the forest and ag sectors. A lot of current work focused on bioenergy, which Eric White will discuss in a later section.
Has comprehensive carbon accounting for both forest and ag sides
Forest land strata are differentiated by ownership, region, site quality, forest type, suitability for agriculture, and forest management intensity (silvicultural regime)
Decisions about forest type (after timber harvest) and forest management intensity are endogenous in the model. Given that land management behavior can vary notably by ownership, and that the forest sector has a heterogeneous set of owners, we also need to recognize that some private owners may supply environmental services at little or no cost (Kline, Alig, and Johnson studies). This is in contrast to the agricultural sector, which tends to have more visible land management (e.g., ARMS surveys) and harvest on an annual basis, in contrast to forest’s long production processes and diverse forest management mix and array of ecological services. Such investigations are facilitated by FASOM-GHG's endogenous modeling of forest management intensity and forest type changes. We also need to account for forestland and ag land converted to developed uses, which are exogenous in FASOM-GHG based on work by Alig, Plantinga, Lubowski and others (e.g., Alig et al projections of land use changes for the US in PNW GTR 813). For example, Haim, Alig, Plantinga, and Sohngen show the importance of such land use conversions to development alongside climate change in a recent article in Climate Change Economics.
Forest carbon studies using the FASOM-GHG model include the Alig et al. (2010) in the J. of Forest Policy and Economics, which indicated that a $30 CO2e price was a threshold price for response on private lands in the Corn Belt per afforestation potential. It is important to recognize that the FASOM-GHG studies typically provide indicators of potential, and that other research can be used to hone in on likely behavior by landowners. Greg Latta in the next talk will discuss how we used the FASOM-GHG model to investigate what subset of the overall potential might be enrolled in a voluntary manner by private owners. We currently require them to enroll and participate for 100 years, which is much longer than that apparently attractive to owners for traditional conservation programs (e.g., CRP tree planting program participation of 10 to 15 years). Additional research is needed to identify attractive tenure periods for such participation.

4. US land uses, 2006 (37%) (20%) (4%) (5%) (31%) (3%)
Source: Inventory of US Greenhouse Gas Emissions and Sinks: ,
(37%)
(20%)
One point here in snapshot of fairly recent land use allocation in the US: ag and forestry cover almost 90% of land base
Forestry represents ~30%
Cropland and grassland (pasture or rangeland) represents almost 60%
[Note: AK is not included in the data (but represents a large share of US land base.)
Over the 15 year IPCC reporting period:
not been large changes in any category,
except settlements – which increased by 30% (from 18 to 60 mi ha out of 800 mi ha)
(4%)
(5%)
(31%)
(3%)

5. Historical net transitions of forest area to or from other major uses on nonfederal land in the U.S., 1982 to For example, negative numbers represent loss of forest to other uses.
We show the importance of such land use conversions to development alongside climate change in a recent article in Climate Change Economics. This is particularly true for the South (per development concentration in next slide), which had the most land developed in recent NRI surveys and it is a key timber supply region. Increased demands for land will affect forestry’s potential contributions to bioenergy and other goods and services. Significantly more cropland will be required to help feed an additional 3 billion people by 2050 while producing biofuels; furthermore, tens of millions of other acres are needed to house another 125 million U.S. residents. A FASOM-GHG team member, Eric White, tomorrow will discuss bioenergy projections for private timberlands.
East: most reduced, earlier to ag and more now to development
West: majority of public land and relatively less loss
Data source: NRI

6. Concentration of dev area in the East, particularly in the key timber supply (and forest carbon) region of the South (also see recent White et al. article in the JOF: Socioeconomic Changes and Forestland Development: Commonalities and Distinctions
between the Eastern and Western United States)
This includes the key timber supply region of the South
Haim et al. investigate importance of land converted to development when examining overall impacts on forests in addition to climate change

7. Terrestrial Carbon Sequestration Across Sectors
Agricultural Lands
*annual production and harvesting
*farm programs
*crops and livestock, e.g., use of corn
vast majority of U.S. agricultural land is in private ownership
Forests
*afforestation and forest management on private forestlands
*forest management on public forestlands, such as reforestation and responses to disturbances
*private and public forestland coordination?
diverse forest management mix and array of ecological services.
Common land base connects both sectors; however, forest sector involves very long investment periods relative to agriculture. Forest production can take a number of decades, involving a diverse forest management mix and an array of ecological services, some of which are dependent on forest structure, diversity, etc. that may only arise after decades of forest growth. This is in contrast to the agricultural sector, which tends to have more visible land management (e.g., ARMS surveys) and harvest on annual basis.
Broad range of ownerships across forest and ag sectors. Management behavior can vary notably by ownership, and forest sector has heterogeneous set of owners, some who would offer to supply environmental services at little or no cost (Kline et al studies). Ag sector tends to have more visible land management and harvest on an annual basis, in contrast to forest’s long production processes and diverse forest management mix.
NASS and ERS annual Ag Resource Management Survey (ARM)

8. Land Ownership in the United States
Forests cover 1/3 of US land base
Large private and public ownerships, in contrast to agriculture
Conditions of forests in different ownership groups can differ widely, such as wrt age class distributions and timber volumes per acre
Public forests are more frequently managed for nonconsumptive uses such as recreation
Private Responses to public programs: incentives and unintended consequences—dairy buy out program and retention of afforested lands. Dairy buy-out was example of unintended consequences, and analysts also need to be alert for such possibilities with large forestry programs, in the leakage example discussed in Alig et al. (1997) Environmental and Resources Economics article.

9. Private and Public US Forests
Private forests (56%), and public forests (44%)
Public forests are more common in the West
Private forestlands in the East have been reduced in area the most, largely due to conversion to agriculture and development
Large blocks of public ownership in the West vs. intermingled public/private forests in the East
Opportunities for linked management of private and public forests include coordinated harvest scheduling and reforestation
US Forests hold ~ 150,000 Tg CO2e
Private forests store about 87,710 Tg CO2e, compared to 62,132 for public forests
Carbon stocks on nonfederal public timberland declined slightly between 1987 and 1997
Carbon stocks on federal public timberland increased slightly between 1987 and 1997
Biggest increase was on NIPF timberlands
Overall, US forests offset ~8% of US GHG emissions in 2007; some estimated higher % earlier
Public forest carbon flux is about 50% larger in aggregate than that on private forests

10. Projections of Public Forest Carbon
Woodbury et al: forests, urban trees, and wood products account for most of the U.S. carbon sink—65–91%.
Depro et al. 50 Tg annually could be sequestered under BAU; zero harvest could increase it 40 to 50%
Ince (2008) and Skog et al. (2006): hazardous fuels reduction, along with Abt and Prestemon
Adams and Latta (2005): federal forestland restoration program
Although private forestlands (and primarily timberland) have been the subject of much research with the FASOM model and in other studies, a growing body of literature pertains to public forestland carbon potential and costs. Will talk next about additional Oregon State studies in that area, but only have time to briefly give examples. Interested parties can find more details by accessing Darius Adams’ web site at Oregon State U. and in three briefing papers in the form of Forest Service PNW GTRs, available from the PNW Publications office, online at their web site. First one is Forest Biomass GTR 825 by Eric White; GTR 833 has six papers about climate change effects on the forest sector, private and public forest ownership, NIPF baseline issues, and related topics; and GTR 838 pertains to the effects of climate change on wildlife and rural communities. GTR 833 contains a paper by White and Alig that summarizes findings about forest carbon sequestration potential on public lands. Some facts include: US forests hold ~ 150,000 Tg CO2e and offset from about 15 to 18% US GHG emissions, depending on definitions; private forests store about 87,710 Tg CO2e, compared to 62,132 for public forests; carbon stocks on nonfederal public timberland declined slightly between 1987 and 1997; carbon stocks on federal public timberland increased slightly between 1987 and 1997; biggest increase was on NIPF timberlands; public forest carbon flux is about 50% larger in aggregate than that on private forests; and one question to be considered is public land participation in carbon markets and any crowding out effects.

11. Oregon State Univ. Study of Private and Public Forest Carbon
“BASELINE” OR BUSINESS AS USUAL
* PRIVATE SECTOR RESPONSES TO CARBON OFFSET SALES
– MANDATORY (SUBSIDY/TAX) SYSTEM
– VOLUNTARY SALES
* PUBLIC SECTOR RESPONSE TO POLICY CHANGES
– ZERO HARVEST
– MAXIMUM “NON-DECLINING EVEN FLOW”
*COMBINED PUBLIC AND PRIVATE POTENTIAL
*OPPORTUNITIES FOR “COORDINATED STRATEGIES” BETWEEN
PUBLIC AND PRIVATE LANDS – AN EXAMPLE FROM THE PNW
In line with all lands approach, need cross boundary analyses to examine opportunities across ownerships.
In view of time limit, one main point here is that cooperators (e.g., Darius Adams at Oregon State) have used the FASOM-GHG model to examine combined forest carbon sequestration by private and public forestlands, including gains if you assume that you can coordinate harvest, regeneration, and other activities across private and public ownerships, as their relative age class distributions may offer opportunities for gains via coordinated activities.

12. Public and Private Forest Contributions
Zero public harvest and $30 C02e mandatory raises forest sector flux by nearly 2 billion tonnes/year
Zero public harvest and $30 C02e voluntary leads to same forest sector flux as baseline
Maximum nondeclining even flow and $30 C02e voluntary private leads to same carbon seq. as baseline but much higher timber harvest (Adams and Latta)
$30 CO2e price would cause more response on private lands because of afforestation potential
Question is public land participation in carbon markets and any crowding out effects
Capacity of public forest units to respond quickly to valued carbon, and supporting roles of information provision and partnerships
Soil expectation values (SEV), as one proxy for effect on land values, on average almost doubled with a $25 CO2 price compared to the base case with no carbon price. These are “bare” forestland values. Moving to a $50 CO2 price increased the SEV values by more than 2.5 times compared to the base case.
Afforestation area is sensitive to CO2 prices, projected net change in forest area involving land exchanges with agriculture (afforestation area minus area deforested to agriculture) summed over the first 50 years of the projection was positive with a $20 CO2 price, in the Alig et al. (2010 journal Forest Policy and Economics) study. In contrast, net change levels without a CO2 price are negative. If deforestation to developed uses is considered, then a CO2e price of close to $30 is needed to have positive net change in forest area

13. Summary
Large forestland base, with important private and public components
Private forests have been subjected to more changes, including timber harvest and land-use changes (Greg Latta will discuss in the next talk the importance of voluntary behavior by private forestland owners wrt forest carbon sequestration or fluxes)
Public forest lands concentrated in the West, many with trees older than on private lands, and managed for multiple objectives
Projections indicate substantial opportunities to sequester more carbon on public forests
Linkages between private and public forests include possible timber harvest scheduling to increase net amount of carbon sequestration
Bioenergy demand is important for both private and public forest management (Eric White will talk later on this subject)
An OR/MS-based tool, the Forest and Agriculture Sector Optimization Model-Green House Gases (FASOMGHG) model, is a mathematical programming model that includes forest bioenergy modeling and carbon accounting. Increased demands for land will affect forestry’s potential contributions to bioenergy and other goods and services. Significantly more cropland will be required to help feed an additional 3 billion people by 2050 while producing biofuels; furthermore, tens of millions of other acres are needed to house another 125 million U.S. residents.
Relatively large Influence of Carbon prices.
Most forest carbon is with a $50 CO2 price, reduced amount of deforestation for developed uses, and land can move freely between the forestry and ag sectors.
These are other examples of results, with more details given by Alig et al. (2010) in a Forest Policy and Economics article.
The talk has demonstrated the evolution of the modeling system, including now where carbon prices are simulated and for which linkages between forestry and ag are important. ; such as for prices and carbon seq.
Eric White to discuss bioenergy projections for private timberlands

14. Looking Ahead—Selected Research Needs
*Interactions between private and public forest land management wrt mitigation costs and opportunities, including woody biomass for bioenergy
*Landowner behavior in response to climate change programs or incentives
*Afforestation capacity and adoption likelihood in different regions
*Retention and condition of mitigation practices in forest sector
C. Langpap and PhD student at Oregon State U.: surveys in South and PNWW regions to investigate aggregate marginal cost curves for afforestation –are owners interested in such incentives and what are stated tendencies to afforest land at different CO2 prices
Plantinga and Mason: contracting study to investigate additionality; Governments contracting with private agents for the provision of an impure public good must contend with agents who would potentially supply the good absent any payments. This additionality problem is centrally important in the use of carbon offsets as part of climate change mitigation. Analyzing optimal contracts for forest carbon sequestration, an important offset category, we conduct a national-scale simulation using results from an econometric model of land-use change. The results indicate that for an increase in forest area of 50 million acres, annual government expenditures with optimal contracts are about $4 billion lower compared than under a uniform subsidy.
Investigate retention rates of afforested lands and optimal management to sequester carbon. Can utilize some findings from earlier studies of Soil Bank and other programs. USDA may also want to investigate retention rates of afforested lands and optimal management to sequester carbon, as they could draw upon findings from earlier studies of Soil Bank and other USDA programs. A new need is examining optimal stocking of afforested land, in contrast to “per acre” approach of earlier programs that focused on area of land moving out of surplus cropland or erodible cropland vs. current concern with optimal stocking for sequestering carbon over time.

15. Briefing Papers Prepared for Forest Service Decision Makers
Forest Service PNW GTR 833—White and Alig document role of public forests
PNW GTR 837—Morzillo and Alig discuss related ecosystem services such as wildlife habitat
Many studies differ in their assumptions about the form of the carbon market or the policy that compensates private or public owners for carbon sequestered
White in PNW GTR 825 discuss contributions of forest sector to providing bioenergy
Haim, Alig, Plantinga, and Sohngen show the importance of land use conversions to development alongside climate change in a recent article in Climate Change Economics.
Syntheses of model applications and results, along with information about policy issues, are included in briefing papers commissioned by the Forest Service’s WO.
Three briefing papers in the form of PNW GTRs are available from PNW Publications office in Portland, OR, online at their web site. First one is Forest Biomass GTR 825 by Eric White. Other two are GTR 833, which has six papers about climate change effects on the forest sector, private and public forest ownership, NIPF baseline issues, and related topics; and the other and third GTR (#837) pertains to the effects of climate change on wildlife and rural communities.

16. Transition to Elizabeth Reinhardt’s Talk
Elizabeth will give examples of the type of modeling needed to support road map and scorecard work on Forest Service public forestlands for carbon stewardship
Elizabeth will discuss regional variation and how that impacts setting policies, State Dept (COP 7) discussions about force majeure, modeling disturbances and harvest in scenarios, risk considerations in decision making, life cycle analysis needs, etc.
Elizabeth Reinhardt will follow my talk and concentrate on USDA Forest Service scorecard analyses for that agency's NF and grassland public lands, after I just set the stage with a broader all-lands talk that summarizes some public forestland findings at regional and national scales. In the “All Lands Approach,” NF’s forests and grasslands are part of a larger human and ecological landscape comprised of public and private lands. Natural disturbances are a major risk consideration on public forest lands, where policies can affect an array of ecosystem services and products