Raju Pokharel

In the United States, voluntary carbon markets have gained significant traction in recent years. However, many offset standards, protocols, and credit ratings have come under scrutiny from the public and investors for failing to produce real or sustainable carbon offsets. Additionally, communities often find themselves unprepared to advocate for forest-based carbon projects that align with their needs and interests, mainly due to a lack of information and a general distrust surrounding carbon projects. There is a pressing need to address the social, ecological, and technological barriers that hinder the development of higher-integrity carbon credits and limit crucial financing for climate change mitigation activities. This paper is the culmination of findings from a series of discussions held in 2025 by leading academics, non-profit organizations, and forestry professionals to identify key challenges, research priorities, and actionable steps to scaling voluntary forest carbon markets. The discussions focused on six priority areas including permanence; additionality; leakage; measurement, monitoring, reporting, and verification (MMRV); market investments; and the social and ecological implications of carbon markets. By reporting on these discussions, we aim to strengthen conversations across forest carbon topics to enhance market access while simultaneously identifying needs for developing high-integrity forest carbon projects for climate change mitigation and rural communities.

The accumulation of small‐diameter and low‐value trees and logging residues can negatively impact forest health by increasing the risks of pests, diseases, and wildfires. Biochar production presents a potential solution by creating markets for these underutilized resources. However, there is limited information on market dynamics and the influence of subregional conditions on the use of forest biomass for biochar. The study identified potential locations for biochar production and developed procurement zones using delivered wood prices to evaluate biomass availability and biochar application. The minimum selling prices (MSP) for biochar were calculated for local applications to assess the cost savings. Under a baseline scenario with an average delivered biomass price of $23.25 per green ton, stationary facilities produced 71% more biochar than the estimated requirements in the Upper Peninsula (UP) but only 10% more in the Lower Peninsula (LP). Portable units, however, produced less biochar than the required application in both regions, with deficits of 4% in the UP and 50% in the LP. While stationary facilities are more cost‐effective and scalable, portable units can procure more biomass and offer greater opportunities for land application of biochar. Despite a lower MSP for stationary facilities, portable units could provide a more economical option by reducing investment costs and risks. The study recommends establishing portable units in the UP and stationary facilities in the LP to optimize forest biomass procurement and biochar production in Michigan. This analysis contributes to understanding resource availability and the potential utilization of forest biomass for biochar in Michigan.

The forest products industries play a vital role in the economic, social, and environmental well-being of the Lake States in the United States. While various economic contribution analyses of forest products industries have been conducted to highlight the importance of such industries to regional economies, little effort has yet been made to parse out the contribution of activities in the value chain. The value chain is a series of steps involved in producing goods or services. This study used a matrix decomposition approach to estimate the economic contribution along the value chain through multiple pathways of four forest resource-based industries using wood as inputs: biomass power generation, sawmills, paper mills, and the construction of new single-family residential structures in the Lake States. The direct and indirect economic output values in 2017 resulting from the construction of new single-family residential structures were $19.1 billion, sawmills were $2.5 billion, paper mills were $17.6 billion, and the biomass power generation industry was $759 million. Of the direct and indirect economic output contributed by each industry, the highest percentage of output attributable to the logging industry was observed from the sawmills industry (12%), followed by biomass power generation (9%), paper mills (1.4%), and the construction of new single-family residential structures (<1%), respectively. The percentage of total economic output attributable to the stumpage industry in the region followed a similar trend as commercial logging for all value-chain industries. The relative economic contribution of the value-chain industries to the total economic contribution of the final industry varied based on whether the industry was a primary or secondary forest products industry and the pathways used for sourcing wood inputs.

The Lake States (MI, MN, WI) region holds 54.8 million acres of forest and offers the potential to meet the increasing demand for sustainable energy through forest biomass. The objective of this study is to estimate the annual availability of biomass, after considering the sustainability threshold, for a wood price and its economic impact in the Lake States region. This study identified twenty-seven active power facilities using biomass in addition to oil, gas, and coal, with a total capacity of 3.85 million MWh per year. They consumed 2.80 million dry tons of biomass in 2019. At the current delivered wood price, an additional 9.72 million dry tons of biomass is economically available, which, if used, would generate an additional 11,112 jobs (1,583 direct and 9,529 indirect and induced), $1.54 billion in value added ($803 million direct and $733 million indirect and induced), and $2.71 billion ($1.46 billion direct and $1.25 billion indirect and induced) in total output. Operating at least one-third of the existing capacity for biomass-based power generation would add 1,969 jobs, $293 million in value added, and $413 million in total output. The expansion of the biomass biopower industry has the potential to significantly increase economic impact, especially in rural areas. Study Implications: Mapping procurement zones for resource allocation using delivered wood prices for biomass helps identify the economic availability of biomass for electric power production in the Lake States. Our results establish the market extent for biomass and identify potential areas where investment in biopower production or capacity upgrade is feasible. This study also provides insight into the economic impacts of additional biomass utilization to produce power. Most of these impacts would come about in rural areas, improving economic growth in these communities. A combined analysis estimating the potential supply and demand and the economic effects of biopower industry expansion provides valuable insight into decision-making for state forest action plans and private sector forest management plans. Furthermore, the findings from this study will help inform effective regional policy and investment decisions on biomass power industries. The method used can also be tailored to a specific facility to estimate its procurement zone, feedstock availability, and economic impacts.

This study utilizes forest inventory and climate attributes as the basis for estimating models of wildfire risk and associated biomass loss (tree mortality) and then demonstrates how they can be applied in calculating CO₂ emissions related to the incidence of wildfires from U.S. forests. First, we use the full set of over 150,000 FIA plots of national forest inventory and climatic parameters to estimate models of the annual probability of wildfire occurrence and loss of live tree biomass. Then, maps of the spatial allocation of both the model-derived probability of wildfire occurrences and tree mortality are presented at the national level. The probability of wildfire occurrences and tree mortality were defined by a complex non-linear association of climatic conditions and forest ownerships, available aboveground biomass, and the age of the stand. Then, we provide an example of how these models can estimate potential CO₂ emissions from wildfires by using FIA inventory data. We estimated 6.10, 16.65, 22.75, and 31.01 million metric tons of annual CO₂ emissions with low, medium, high, and catastrophic combustion rates, respectively, from forests due to wildfire in the continental U.S. The wildfire risk and biomass loss due to tree mortality maps can be used by landowners, managers, public agencies, and other stakeholders in identifying high-risk wildfire zones and the potential CO₂ emissions. These equations can also help estimate fire risk and associated CO₂ emissions for future climate conditions to provide insight into climate change-related wildfire occurrences.

Market coverage, or merchantability, is more than selling commodities. By offsetting expenditures, it provides an effective tool allowing forest managers to expand funding assistance to improve forest health, habitat, and water quality; reduce fire risk; and sustainably manage forest resources and services. This analysis narrows the focus to mill inputs and evaluates the forest products market extent and competition that exist in Idaho to better prioritize forest health improvement and fire mitigation funding programs. We identify priority landscape areas through market extent and market competition and classify each by quintiles for three harvested wood products (sawlogs, pulpwood, biomass). Generating revenues from selling harvested wood products where barely any markets exist or markets could expand with incentives would allow management projects to be done at a more extensive scope or a lower cost per area. The results can also be used to identify areas to invest in forest product manufacturing facilities. This is valuable information for decision-makers looking to direct public assistance funding toward projects that generate forest products.

Habitat conservation banking is a policy instrument for conserving endangered species by providing financial incentives for the landowners in the United States. This policy instrument aims to protect habitat, but little or no thought has been given to its financial performance. A financial analysis of habitat conservation banks (HCB) informs policymakers and conservation biologists of the long-term success of this policy and the future of HCBs. This paper evaluates 26 habitat conservation banks (HCB) in California by calculating their Net Present Values (NPV). We do so by compiling the cost and revenue data for habitat conservation banks. The average annual cost of operating HCBs was $42.78/acre (median: $22.58/acre), and the average credit price or revenue from credit sale was $6014.72/acre (median: $553.65/acre). The average NPV for 26 HCBs was $4205.90/acre at a 4% rate of return, indicating an overall positive return from such an easement instrument. However, only 14 HCBs out of 26 produced a positive return. With the inclusion of land acquisition costs, three of eight HCBs performed financially well. On the brighter side, the number of HCBs has increased with time. But there is not enough evidence to ascertain financial certainty from their revenues. A right selection of space (land acquisition costs can make or break finances for HCB) and species could encourage landowners to establish HCBs. This could build confidence on those who may have been discouraged from lack of knowledge and fear of losing revenue due to regulatory compliance to conserve endangered species habitat in their land. The findings are helpful in identifying lands and prioritizing investments to generate conservation credits.