@article{Hean:57888,
      recid = {57888},
      author = {Hean, Robyn L. and Cacho, Oscar J. and Menz, Kenneth M.},
      title = {Temporary carbon storage and discount rates},
      address = {2003-02},
      number = {414-2016-26116},
      pages = {11},
      year = {2003},
      abstract = {Several approaches have been proposed for accounting for  temporary carbon
sequestration in land-use change and  forestry projects that are implemented to offset
permanent  emissions of carbon dioxide from the energy sector. In a  previous paper,
we evaluated the incentives provided by  some of these approaches. In this paper, we
investigate  further what we call the “ideal” accounting system, where  the forest owner
would be paid for carbon sequestration as  the service is provided and redeem
payments when the forest  is harvested and carbon is released back into  the
atmosphere. We demonstrate how discounting affects the  net present value of the
forest when carbon sequestration  is taken into account under this ideal system. Not  all
carbon is released back into the atmosphere at harvest,  however, since a large
proportion may remain fixed in  forest products for many years. Here, we compare  the
profitability of the forest under full redemption of  credits at harvest, with partial
redemption of credits at  harvest followed by annual redemption post-harvest as  the
carbon decays in a durable forest product. The analysis  is based on simulation of
farm-forestry systems in  south-eastern Australia.},
      url = {http://ageconsearch.umn.edu/record/57888},
      doi = {https://doi.org/10.22004/ag.econ.57888},
}