Economics of forest ecosystem carbon sinks

The reason for ignoring CCS is that little is known about its costs, including the cost associated with the future risk of a sudden release of CO2 that kills a significant number of people – a cost evaluated by the willingness of people to pay to avoid such a risk and not unlike that associated with long-term storage of nuclear waste, which Riddel and Shaw (2003, 2006) indicate could be substantia [...] If the damage function is linear so that marginal damages are constant – damages per unit of emissions remain the same as the concentration of atmospheric CO2 increases – then the present value of reductions in the stock of atmospheric CO2 declines at the social rate of discount. [...] If the conversion rate between ton-years of (temporary) CO2 sequestration and permanent tons of CO2-emission reductions is k, a LULUCF project that yields one ton of carbon uptake in the current year generates only 1/k tons of emission reduction – to cover the one ton reduction in emissions requires k tons of CO2 to be sequestered for one year.12 The exchange rate ranges from 42 to 150 ton-years o [...] The original idea is to count a temporary ton as equivalent to a permanent one only if the carbon is sequestered for the full period of time given by the exchange rate. [...] Rather than the authority establishing a conversion factor, the interaction between the market for emission reduction credits and that for carbon sink credits determines the conversion rate between permanent and temporary removals of CO2 from the atmosphere.