Collaborative Research: Supply Functions and Clean-Development Mechanism Rules for Tropical Forest Carbon Sinks

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Because of concerns about global climate change, society is actively exploring the possibility of using forest ecosystems as a carbon sink. Tropical forests may offer more than two-thirds of such opportunities. The protection of tropical forests could offset global fossil fuel carbon emissions and reduce the cost of emissions limitations set in Kyoto. In addition, certified emissions credits (CERs) under the Clean Development Mechanism (CDM) established in Kyoto likely will incorporate tropical forest sinks within efforts to meet emissions targets. In principle, this could result in significant economic and sequestration benefits, although actual evidence on tropical carbon sinks is sparse. To advance knowledge and practice associated with this important topic, this collaborative research project has two major goals. First, the investigators will develop an integrated, spatially explicit model of that predicts how much additional carbon sequestration will occur in Costa Rica if financial rewards for sequestration are offered. This modeling effort will include both economic modeling of land use and ecological modeling of carbon storage. Both sets of models will be based on empirical observations of carbon and nitrogen stocks and flows, with systematic sampling of variations in soils, climate, and land uses. The second major goal of the research will be to contribute to the effective design of rules that allow carbon-sequestration efforts in tropical locations to replace emission-reduction efforts in more developed nations. This line of inquiry will involve the conduct of sensitivity analyses on the integrated model in order to derive simplified versions of state-of-the-art disciplinary and integrated models. This effort will facilitate the search for estimate how much carbon sequestration will be generated in Costa Rica in response to different kinds of monetary rewards for carbon sequestration. This project will increase understandings of the interplay of socioeconomic and ecological factors that influence land-use choices as well as the effects of land-use change on carbon sequestration in Costa Rica, a representative nation with significant tropical forests and readily available data sources. In addition to addressing these fundamental issues, the project will explore the potential for simplified models to identify the potential implications of different carbon-sequestration incentives on land-use decisions, thereby providing valuable new insights into critical aspects of the Kyoto accord to reduce atmospheric carbon.