Nieuws - 17 februari 2005

A hectare of new forest for 111 dollars

Global CO2 emissions can be reduced by between 5 and 25% by planting forests on farmland, according to PhD graduate Dr Pablo César Benítez-Ponce. He calculated that farmers in Ecuador would be prepared to make the switch from farming to forestry management for somewhere between 30 and 111 dollars.

The method he suggests is interesting because, when the Kyoto Protocol comes into force, worldwide trade in CO2 rights will start. It was already known that forests act as good storage sinks for CO2, but Benítez-Ponce has quantified how much difference it would make if farmers converted from farming to forest management. The amount varies between 5 and 25%, depending on the level of investment worldwide in climate policy. Benítez-Ponce made a cost-benefit analysis for different types of landuse, and concluded that teductions in CO2 emissions are primarily achievable in the humid tropics.

The Ecuadorian economist calculated what incentives would be needed to convince farmers in his home country to go over from using their land for mixed farming (coffee, rice, maize or dairy cattle) to doing forest management. An offer of 30 dollars was enough to persuade some farmers who currently combine maize and coffee cultivation. The amount required to persuade all farmers in Ecuador to switch to forest management is 111 dollars per hectare.

Benítez-Ponce’s calculations give an indication of what the price of CO2 rights is likely be on the market that will open up once the Kyoto Protocol is signed. Countries will be able to negotiate for CO2 storage sinks, for example in forests, using ‘certificates of emission reduction’.

Dr Pablo Benítez-Ponce received his PhD degree on 11 February. His promotor was Professor of Economics, Henk Folmer. / MW