Societal interest in mitigating climate change has opened the door for forest management to play an integral role in reducing atmospheric CO2. Yet, uncertainties involving the effects of climate change can significantly affect forest planning and decision making. Literature concerning the role of risk in forest management is well established, but few have considered risk and uncertainty in forest carbon offset production. As climate change is expected to increase the frequency and severity of disturbances, future carbon removals in forests will inevitably become more uncertain.
This research investigates the impact of risk and uncertainty on forest planning decisions for joint economic and ecological benefits. First, we propose to build a forest management model, taking into account stochastic disturbances to stand growth and carbon flux based on past behavior of ecological, climatic, and economic shocks. Next, we determine the viability of generating carbon offsets, and how sensitive this is to stochastic carbon prices. Finally, we will integrate the carbon stored in harvested wood products to round out the carbon budget of the forest. This research will better inform forest managers and policy makers of the economic and ecological effect of uncertainties resulting from climate change.