Valuing the forest carbon stocks Valuing the forest carbon stocks of the Brazilian Amazon of the Brazilian Amazon Universidade Federal Universidade Federal de Minas Gerais de Minas Gerais UF G UF G Woods Hole Woods Hole Research Center Research Center IPAM – INSTITUTO DE PESQUISA AMBIENTAL DA AMAZÔNIA Britaldo Soares-Filho, Daniel Nepstad, Frank Merry, Hermann Rodrigues, Maria Bowman , Paulo , Paulo Moutinho Moutinho
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Valuing the forest carbon stocks of the Brazilian Amazon Universidade Federal de Minas Gerais UF G Woods Hole Research Center IPAM – INSTITUTO DE PESQUISA.
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Valuing the forest carbon stocks of the Valuing the forest carbon stocks of the Brazilian AmazonBrazilian Amazon
Universidade Federal Universidade Federal de Minas Geraisde Minas Gerais
UF GUF GWoods Hole Research Woods Hole Research
CenterCenter
IPAM – INSTITUTO DE PESQUISAAMBIENTAL DA AMAZÔNIA
Britaldo Soares-Filho, Daniel Nepstad, Frank Merry, Hermann Rodrigues, Maria Bowman, ,
Paulo MoutinhoPaulo Moutinho
CURRENT ECONOMIC MODEL FOR THE AMAZON CURRENT ECONOMIC MODEL FOR THE AMAZON FORESTFOREST
Small economic value for Small economic value for the standing forestthe standing forest
How to change this paradigm?How to change this paradigm?
Payment for ecosystem services..Payment for ecosystem services..
How to compensate developing countries to reduce emissions from deforestation?
Incorporating emissions reductions Incorporating emissions reductions from tropical land-use change into from tropical land-use change into the international climate regime the international climate regime (UNFCCC process)(UNFCCC process)
United States of America 15%
China 11%European Union (25)
11%
Indonesia 7%Brazil 5%
Others 35%
Russian Federation 5%
India 4%
Japan 3%Germany 2%
Malaysia 2%
65% deforestation65% deforestation
REDD = Reducing Emissions from Deforestation and Degradation
Forgone profits*Forgone profits**a fraction of the costs of a REDD program
Opportunity cost =Opportunity cost =
Rent from cattle raisingRent from cattle raising
Rent from agribusinessRent from agribusiness
Rent from sustainable Rent from sustainable logginglogging
Rent for other forestry products (Brazil nuts,
rubber, etc)
Rent from loggingRent from logging
Interdisciplinary Model for Soybean Yield
88 polygons
DATA SOURCES
Agricultural Census (1995-96)
Soil Parameters
Climate DataRooting Depth pH
Precipitation Temperature
Solar Radiation
Vera-Diaz, et al. An Interdisciplinary model of Soybean Yield in the Amazon Basin: the climatic, edaphic, and economic determinants. Ecological Economics, 2007.
Scenarios of Soy frontier expansion in response to Paving
Hydro Powers: Jiraú and Santo AntônioNorthern Corridor and Transoceanic HighwayPotential area with high rents = 976,000 km2 or increase of 13%Pando, El Beni, Acre, and Madre de Dios U$/hecU$/hec
RentRent
R
RR
R
RRR
R
R
R
AM PA
MT
MA
TO
RR
RO
AC
AP
Belém
Macapá
Manaus
Palmas
Cuiabá
Santarém São Luís
Boa Vista
Rio Branco
Porto Velho 45°W
45°W
50°W
50°W
55°W
60°W
0°
5°S
10°S
15°S
0°
70°W 65°W
60°W
55°W
5°N5°N
65°W
5°S
10°S
15°S
70°W
deforested
Cerrado biomePaved road
Unpaved roadU$ 0/hec
U$ 12000/hec
Soy Net Present Value for 30 yearsSoy Net Present Value for 30 yearsdiscount rate of 5%discount rate of 5%
The model produces dynamic rent surfaces based on wood prices, harvest and The model produces dynamic rent surfaces based on wood prices, harvest and milling costs collected for 588 milling centers located throughout the Amazon milling costs collected for 588 milling centers located throughout the Amazon
harvest capacityharvest capacity
milling centersmilling centers
Update friction surface
Calculate transportation cost to milling center
Define milling shed
Milling centers
Harvest volume
Calculate profit for each raster cell within a
specific milling shedMilling center’s
capacity
Wood price at milling center
Processing costs at milling center
Harvesting costs at milling center
Rank cells by their profitability
Harvest wood
Deforest (deforestation model)
Expand and improve infrastructure
(deforestation model)
Increase/decrease capacity, update costs and price, and
milling centers
emerge or deactivate
Regenerate forest Sojourn time
Initial land use and cover Logging Model Structure
(Merry et al., in press)
R
RR
R
RRR
R
R
R
AM PA
MT
MA
TO
RR
RO
AC
AP
Belém
Macapá
Manaus
Palmas
Cuiabá
Santarém São Luís
Boa Vista
Rio Branco
Porto Velho 45°W
45°W
50°W
50°W
55°W
60°W
0°
5°S
10°S
15°S
0°
70°W 65°W
60°W
55°W
5°N5°N
65°W
5°S
10°S
15°S
70°W
deforested
Cerrado biomePaved road
Unpaved roadU$ 0/hec
U$ 550/hec
Sustainable Logging Net Present Value for 30 years
Opportunity Cost
Carbon stock
Rent from logging
Rent from cattle raising
Rent from agribusiness
Supply curve
+
+
-
/
max
Opportunity Cost
Carbon stock
Rent from logging
Rent from cattle raising
Rent from agribusiness
Supply curve
+
+
-
/
max
0 tons/hec.
275 tons/hec.
Adapted from Saatchi et al., 2007
Brazilian Amazon forest 47 ± 9 billions of tons of Carbon
Carbon of above and bellow ground biomassCarbon of above and bellow ground biomass
All models are integrated on the same modeling platform
Custo de oportunidade
R
RR
R
RRR
R
R
R
AM PA
MT
MA
TO
RR
RO
AC
AP
Belém
Macapá
Manaus
Palmas
Cuiabá
Santarém São Luís
Boa Vista
Rio Branco
Porto Velho 45°W
45°W
50°W
50°W
55°W
60°W
0°
5°S
10°S
15°S
0°
70°W 65°W
60°W
55°W
5°N5°N
65°W
5°S
10°S
15°S
70°W
deforested
Cerrado biomePaved road
Unpaved road
US$ 3-0 per ton
US$ 0 per ton
US$ 8-13 per ton
US$ 3-8 per ton
> US$ 13 per ton
Opportunity costsOpportunity costs
Opportunity costs for reducing deforestation
05
10
15202530
35404550
55606570
75808590
95100
0 5 10 15 20 25 30 35 40 45
GigaTonsTons of Carbon in the Amazon forest (3.3 million Km2)
U$
47.9E+9 Total Carbon in tons
142 average ton/hec
3,385,537 forest area km2
232.26E+9 Total cost U$
4.85 U$ Average Cost Carbon
U$ 5.20 without loggingU$ 5.20 without logging
Calculating the op cost along the potential Calculating the op cost along the potential deforestation frontierdeforestation frontier
years
30
29
28
27
26
25
24
23
22
21
20
19
18
17
16
15
14
13
12
1110
9
8
7
6
5
4
3
2
1
0
100
200
300
400
500
600
700
800
900
1,000
1,100
1,200
1,300
1,400
1,500
1,600
0 50 100 150 200 250
Million tons of C
U$
30
29
28
27
26
25
24
23
22
21
20
19
18
17
16
15
14
13
12
11
10
9
8
7
6
5
4
3
2
1
Simulated deforestation Simulated deforestation by 2038by 2038