A comparison of sequestration of CO2 by forestry and capture from power stations

Published costs of climate change mitigation options have been derived using a wide range of technical and economic assumptions. This can make it difficult to compare results from different sources. To overcome this problem, the IEA Greenhouse Gas R&D Programme uses a common basis for its studies to assess a variety of options. An important issue in any assessment of options is the timing of the costs and the carbon sequestration. It is generally accepted that costs and benefits that occur in future are worth less to society then present day costs and benefits. The rate at which future costs and benefits are discounted to the present is the subject of debate amongst economists and very different rates are used in different circumstances. Nevertheless, it is important that the same discount rate and methodology are used when comparing options. In this paper, the importance of timing and the discounting methodology is illustrated by reference to two alternative mitigation options: capturing CO2 in a power station with underground sequestration, and planting and managing forests to sequester carbon. Some results are reported from a recent study of a large-scale tropical forestry scheme, carried out for the IEA Greenhouse Gas R&D Programme. When put on the same economic basis, the costs of the forestry sequestration scheme are found to be broadly comparable with the costs of power station CO2 capture and sequestration. Other environmental benefits, such as helping to maintain biodiversity, will count in favour of forestry sequestration but are typically not included in these calculations.