Global trade impacts of increasing Europe's bioenergy demand |
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| Institution: | 1. Department of Forest and Wildlife Ecology, University of Wisconsin-Madison, Madison, WI 53706, United States;2. Department of Economics, University of Victoria, Victoria, BC, Canada V8P 5C2;1. Department of Ecology and Natural Resource Management, Norwegian University of Life Sciences, P.O. Box 5003, 1432 Aas, Norway;2. Chair of Forest and Environmental Policy, University of Freiburg, Tennenbacherstrasse 4, D-79106 Freiburg i.Br., Germany;3. European Forest Institute – Central European Regional Office, Wonnhaldestrasse 4, 79100 Freiburg, Germany;4. Forest Sciences Center of Catalonia (CTFC), Ctra. de St. Llorenç de Morunys, km 2, 25280 Solsona, Spain;5. Forest Sciences Center of Catalonia (CTFC), Sant Pau Historical Site, St. Leopold pavilion, c/St. Antoni M. Claret 167, 08025 Barcelona, Spain;6. Natural Resources Institute Finland, P.O. Box 68, 80101 Joensuu, Finland;7. Universitiy of Ljubljana, Biotechnical Faculty, Department of Forestry and Renewable Forest Resources, Ve?na pot 83, 1000 Ljubljana, Slovenia;8. European Forest Institute - Mediterranean Regional Office (EFIMED), Sant Pau Historical Site, St. Leopold pavilion, c/St. Antoni M. Claret 167, 08025 Barcelona, Spain;1. Institute for Sustainable Economic Development, University of Natural Resources and Life Sciences, Feistmantelstraße 4, 1180 Vienna, Austria;2. BIOENERGY 2020+ GmbH, Gewerbepark Haag 3, 3250 Wieselburg-Land, Austria;1. Energy Economics Group, Vienna University of Technology, Gusshausstrasse 25–27, AT-1040 Wien, Austria;2. Norwegian University of Life Sciences, Høgskoleveien 12, NO-1430 Ås. Norway;3. Copernicus Institute, Heidelberglaan 2, NL-3584 Utrecht, The Netherlands;4. Enerdata, Global Energy Forecasting, 47 Av. Alsace Lorraine, F-38000 Grenoble, France;1. The Ohio State University, United States;2. RTI International, 5040 E. Cornwallis Rd., P.O. Box 12194, Research Triangle Park, NC 27709-2194, United States;3. United States Environmental Protection Agency, United States |
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| Abstract: | European governments are rapidly turning to biomass to comply with the EU's legislated renewable energy targets for 2020 and 2030. To do so, EU member states will likely have to increase imports of biomass from timber rich regions, which will undoubtedly disrupt international wood product markets. In this study, a static global forest trade model of coniferous wood products is used to examine the effects of expanded demand for wood pellets in Europe to generate reliable electricity. Positive mathematical programming (PMP) is used to calibrate the model to 2012 bilateral trade flows. To assess the impact of increased wood-pellet demand on global forest products, we consider a scenario where EU demand for wood pellets doubles. Model results suggest increases in the world prices of industrial roundwood (1%), particleboard ($34/m3), fibreboard ($30/m3), pulp ($65/t) and pellets (71% to 128%), while the prices of sawnwood and plywood & veneer are projected to fall by $12/m3 and $4/m3, respectively. The gains and losses are unevenly distributed between timber rich and timber poor regions; Russia, Canada and the U.S. experience large net welfare gains of $706 million, $544 million and $416 million, respectively, while Asia loses $1.8 billion. In the forest products sector, the gains outweigh losses with economic benefits increasing by some $4.9 billion, but this is a cost to the consumers of electricity and/or taxpayers in the regions implementing these renewable energy policies. The price of wood pellets is projected to rise between $107 and $154 per tonne. The findings highlight the need to account for the interconnections among softwood forest products globally. |
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| Keywords: | Bioenergy Wood pellets Forestry Vertical and horizontal markets Q17 Q23 Q31 Q42 |
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