Empowering landowners to combat climate change: the economic case for forest carbon supply at the stand level

The objective of this study was to analyze the effect of extending rotation at the stand level in private landowner of Eucalyptus globulus , Eucalyptus nitens and Pinus radiata established in contrasting productivity zones. The analysis also evaluates the impact of uncertainty in financial risk considering variations in the price per Mg of CO 2 stored, costs of silvicultural activities, wood products yield using the ad-hoc simulator growth model and the discount rate. Deterministic results show that lower productivity environment the rotation age can be extended 7 or more years in EUGL and 6 or more in EUNI, with respect to the 12-year baseline. Extending PIRA rotation age resulted in a negative CO 2 NPV, implying that a decision made at establishment to extend the harvest age beyond 22-years baseline will not increase financial returns, when aiming at potential payments for environmental services based on carbon storage. Sensitivity analysis shows that the uncertainties of the stored CO 2 price, pulpable product and discount rate are the main contributors to the total variance in the 13-year NPV of both Eucalyptus species. The uncertainty in price of captured CO 2 contributes more than 50% in either species, with pulpable product and discount rate contributing more than 16 and 4%, respectively.