Bioenergy Incentives & Forest Sustainability

Project Background

The United States (US) South includes about 212 million forested acres; nearly 60% owned by about 4.3 million non-industrial private forest (NIPF) or family forest landowners. With limited markets for small diameter wood, large quantities of unthinned small diameter and standing dead wood has resulted in wildfire hazards and detrimental impacts on forest health. Wood biomass based energy markets are thought to generate income, employment, and rural community stability and contribute to carbon sequestration. Also, these markets could restore economic viability of maintaining forestlands and reduce forest conversions to non-forest uses such as urban development.

The Healthy Forest Restoration Act of 2003 supports forest biomass use for energy. In spite of environmental and social benefits of renewable energy, it accounts for only 6% of the total energy in the US with about half from agriculture and forest biomass. One of the main reasons for this limited share is the price differential. For example, the price of bioenergy is about 7.5 cents per kilowatt-hour while the price of conventional energy is only 5.3 cents per kilowatt-hour. If environmental and social benefits of bioenergy e.g., improvements in aesthetics, biodiversity, forest health and carbon sequestration; and avoided costs of fire fighting are considered, bioenergy can be competitive.

The goal of this project is to determine the optimum mix of policy instruments that can bridge current management and sustainable forest management of non-industrial private forests with wood energy as a product in the US.