Forest conservation for communities and carbon: the economics of community forest management in the Bale Mountains Eco-Region, Ethiopia

Abstract

Forest conservation based on payments anchored to opportunity costs (OCs) is receiving increasing attention, including for international financial transfers for reduced emissions from deforestation and degradation (REDD+). REDD+ emerged as a payment for environmental service (PES) approach in which conditional payments are made for demonstrable greenhouse gas emission reductions against a business-as-usual baseline. Quantitative assessments of the OCs incurred by forest users of these reductions are lacking. Existing studies are coarse, obscure the heterogeneity of OCs and do not consider how OCs may change over time. An integrated assessment of OCs and carbon benefits under a proposed community forest management (CFM) intervention linked to REDD+ is undertaken in Ethiopia. The OCs of land for the intervention are estimated through household survey and market valuation. Scenarios explore how OCs are likely to change over the intervention given qualitative conservation goals and available land-use change information. The feasibility of OCs payment as a tool for REDD+ is assessed by combining cost with emission reductions estimates generated from direct tree measurements. Households’ environmental attitudes, perceptions and intention to cooperate with the intervention, estimated by a voluntary contribution to improve forest management, are then investigated. Mean OCs of forest conservation are US$334/ha, but highly heterogeneous. Plausible futures of agricultural improvement, forest product commercialisation, and degradation of land uses suggest total OCs could approach US$441 million over a 20-year project. Applying carbon stock estimates of 231tC/ha±52 in moist and 132tC/ha±73 in dry forest, REDD+ revenues may not meet annual cumulative OCs, although more nuanced conservation planning could reduce OCs. Despite OCs all households intend to cooperate in the intervention, with mean contribution of US$11±4/year/household. The expected incomes of households under the Bale REDD+ Project intervention however, were high and expectation management is necessary. Recommendations are made for REDD+ intervention design in Ethiopia