Carbon Sequestration

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Carbon sequestration is another popular option, along with emissions reduction, for reducing the CO₂ concentration in the atmosphere.  Based on the cost estimates of carbon sequestration that are enumerated in the table below, and on the discussions in the literature, sequestration should be part of the overall scheme to reduce greenhouse gases in the atmosphere [1, 15, 19].  

This page concentrates on carbon sequestration through forestry measures, which is just one of many sequestration options.  Some other methods of sequestration include removal and storage of CO2 from emissions sources; the use of biomass fuels in place of fossil fuels, which have a much larger net release of carbon; changes in agricultural and land management practices that will lead to net sinks for carbon or at least reduce carbon release into the atmosphere (e.g. the use of conservation tillage); expansion of carbon storage in wood products; and deep ocean carbon storage [1].  Continue reading for a background discussion of carbon sequestration studies and a table of the unit costs of carbon sequestration.  Virtually all of the material provided below is summarized from, and can be found in more detail, in the article by Richards and Stokes, "A Decade of Forest Carbon Sequestration Cost Studies" (1999) [15].

Section 1: Background Information

Several generalizations can be made about the available carbon sequestration cost studies.  Most of the available carbon sequestration studies begin by considering carbon sequestration using a particular technological method (forestry practice), as can be seen by the number of models identified as "Bottom-up models" below [1].  (Click here to read a comparison of top-down vs. bottom-up studies).  The table of cost estimates below groups these forestry practices into three categories: forest plantation, forest management, and agroforestry.  The forest plantation category includes the practice of afforestation and reforestation.  Modification of forestry management practices, adaptation of low impact harvesting methods, lengthening forest rotation cycles, and preserving forestland are all considered forest management measures.  Finally, agroforestry involves blending forestry production and agricultural production [15].  Two types of forestry practices not considered in this discussion are biomass plantation development and urban forestry practices.   

The forestry practices considered by the studies are then matched with geographic regions where their use is appropriate.  The key variables (as noted by Richards and Stokes) needed after a geographic scope is defined are: 

1. the suitable land area for that practice;
2. the treatment cost and land cost for the practiced; and
3. the annual carbon yield [15].

The table of cost estimates  identifies three distinct types of approaches generally used for measuring the the dollars per ton of carbon.  These include  the Flow Summation Method (FSM), the Average Storage Method (ASM), and the Levelized Costs/Discount Method (LCDM).

The FSM simply involves dividing the net present value of costs by the sum of the total tons of carbon captured.  Thus, the model considers time effects on the value of money, but treats the carbon flow in and out of the sink the same, regardless of when it occurs.  This implies that there is no value to capturing any carbon that will eventually be released, regardless of how long that carbon is stored [1, 15].

The ASM summarizes costs of carbon sequestration by dividing the present value of implementation costs over a given amount of time, by the average carbon stored in one management rotation [15].

The LCDM actually stands for two different approaches that give the same amount [73].  Both give a better measure of unit costs of carbon sequestration the the FSM and ASM methods because they account for the time element of carbon capture.  The levelization method involves annualizing the present value of costs over the period of carbon flows and dividing the annualized costs by the annual capture rate.  The discounting method discounts the tons of carbon to a present value, referred to the present tons equivalent, and then dividing that number into the present value of costs [15]. 

The three general modeling approaches are used to predict carbon sequestration costs.  The most common approach is the bottom-up engineering model study.  The other two methods include sectoral optimization studies and econometric studies.  These different methodologies are briefly discussed in the following paragraphs.

Bottom-up studies calculate the cost-effectiveness of specific technological options in a given geographical region.  One key variable used is the cost of the land.  Studies use a wide range of estimators, such as land rental rates, to determine costs, and because of the difficulty in getting land cost estimations, some studies do not include these costs [15].    Another important input factor that is not standardized is the treatment of carbon yields and the timing of capture.  Obviously, this non-uniform approach leads to discrepancies in study results.

Sectoral optimization studies endogenize key variables such as land-owner decisions and price and consider dynamic effects of sequestration.  These models, when used to predict sequestration costs, link the forest and agriculture sectors and allow for interaction between the two.  This is significant because it allows for the consideration of leakage, which could occur if a sequestration program lead to increased prices in agriculture markets and caused forestland to be converted to agriculture [15]. 

Econometric studies consider past landowner behavior and use that to predict future behavior.  Modelers build upon traditional land use studies by linking to them relevant silviculture elements, management practice information, and the time path of sequestration,  (yield curves) [19]. 

In addition to the type of modeling approach used, other factors affect the results of carbon sequestration studies.  These include the following: 

Finally, when considering carbon sequestration costs and the attractiveness of using sequestration versus emissions reduction it is important to consider several long-term implications of carbon sequestration.  According to Stavins, three factors will cause carbon sequestration costs to increase further, relative to carbon abatement costs.  These are summarized in his article as follows: "(1) there is a limited land base on which sequestration can operate, in contrast with a much less limited emissions base -- due to economic growth--on which abatement operates; (2) the available land base for forestry may decrease due to population pressures, driving up the opportunity cost of land; and (3) the magnitude of improvements in the silvicultural domain (growing  more biomass mere quickly per acre) and the forest product domain (less decay of wood products, for example) will probably be less than the magnitude of technological improvements in the case of abatement, including increased efficiency of energy generation and use, and decreased reliance on fossil fuels" [19].

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Section 2: Summary of cost estimation results

Unit Costs of Carbon Sequestration

a. The results of studies have been converted to metric tons and US dollars to facilitate comparison.

b. Sedjo and Solomon do not provide a unit cost figure for carbon sequestration .  The figures presented here are based on their cost and yield.

c. The flow summation method is not used in these reports.  The figures are supplied here for purposes of comparison with other studies.

d. The interpretation of these figures is unclear.

e. Figures in parentheses indicate negative costs.

LCDM - Levelized costs/discount method

FS - Flow summation

ASM - Average Storage Method

Source: Table modified from Richards and Stokes, "A Decade of Forest Carbon Sequestration Cost Studies" (1999). [15]

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