2011 Volume 10 Pages 235-262
Carbon sequestration in forests is being considered as a mechanism to slow or reverse the trend of increasing concentrations of carbon dioxide in the atmosphere. This paper presents the results from a dynamic programming model used to determine the optimal harvest decision for a forest stand that provides both timber harvest volume and carbon sequestration services in the Canadian boreal forest. The primary contribution of this study is that the model incorporates detailed information on carbon stocks in dead organic matter pool (DOM), which have been ignored in stand level economic models. It also considers varying levels of initial DOM stocks. The varying DOM stock has interesting implications because it allows one to establish an initial DOM stock for which a landowner will voluntarily participate in the type of carbon market considered in this study. The results of the study indicate that while optimal harvest age seems to be relatively insensitive to carbon stocks in DOM pool, initial carbon stock levels significantly affect economic returns to carbon management.