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CERE - the Center for Environmental and Resource Economics CERE Working Papers, CERE - the Center for Environmental and Resource Economics

No 2011:11:
Assessing the welfare effects of promoting biomass growth and the use of bioenergy – A simple back-of-an-envelope calculation

Tommy Lundgren () and Per-Olov Marklund ()

Abstract: Using a growth model that accounts for environmental and climate externalities, we take a closer look at the welfare e¤ects of promoting biomass growth and the use of bioenergy. As an illustration, a forest hypothetical intensive forest cultivation project is simulated. Costs and benefi…ts of the project show that we need not only determine the postive effects of promoting biomass growth and the use of bioenergy, such as substitution away from fossil fuels and carbon sequestration. But more importantly, to achieve a balanced measure of the e¤ects on the climate, we must also incorporate all carbon emissions that is associated with bioenergy. Not doing so will overestimate the positive climate e¤ects of increasing the use of bioenergy.

Keywords: Bioenergy; (follow links to similar papers)

JEL-Codes: Q23; Q42; (follow links to similar papers)

16 pages, August 22, 2011

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