An econometric analysis of the costs of sequestering carbon in forests

The Kyoto Protocol and the U.S. Climate Change Plan recognize afforestation as a potential means of reducing atmospheric CO2 concentrations. To examine the cost-effectiveness of afforestation, we use econometric land use models to estimate the marginal costs of carbon sequestration in Maine, South Carolina, and Wisconsin. Our findings include the following: (a) earlier studies of afforestation programs tend to underestimate carbon sequestration costs, (b) afforestation still appears to be a relatively low-cost approach to reducing CO2 concentrations, (c) Wisconsin offers the lowest-cost opportunties for carbon sequestration, and (d) projected population changes have the largest effect oncosts in South Carolina.