Title:
Impact of Alternative Forest Biomass Demand and Supply Scenarios on Regional Economy in Finland
Author(s):
Karttunen, K., Ranta, T., Ahtikoski, A., Huuskonen, S., Hynynen, J., Kojola, S., Lehtonen, M., Salminen, H., Hakala, O., Kujala, S., Törmä, H., Kinnunen, J.
Document(s):
Paper
Poster
Abstract:
Wood supply can be influenced by alternative forest management regimes to fulfill regional demand. The aims of our study were a) to measure the wood supply associated with alternative forest management regimes, b) to estimate future demand for wood with alternative scenarios and c) to assess economic impacts at the regional level, when alternative supply and demand scenarios are assumed. The region of South Savo in Eastern Finland was used as a case area. Despite the South Savo region representing more than 10 per cent of the total wood supply in Finland, investments to the forest sector have been low in this region. Regional economic impacts were assessed according to the following options: current forest management with current regional demand (BAU, business-as-usual), roundwood–intensive forest management with new demand generated by a regional sawmill (SCE 1), energy wood–intensive forest management with a demand due to a new biorefinery producing biocoal pellets (SCE 2), energy wood and roundwood intensive forest management with demand generated by both a new sawmill and a biorefinery (SCE 3). The study material included updated measurements from permanent plots of National Forest Inventory (i.e. data from NFI11) covering the South Savo region. Stand projections for each sample plot were generated using the MOTTI stand simulator according to the alternative forest management regimes (BAU–SCE 3). The time horizon covered a 15 year period until the end of 2030. Total supply volumes were first compared to the regional demand scenarios. Then, applying a modified Computable General Equilibrium (CGE) model (RegFinDyn), the economic impacts of alternative supply-demand balances were assessed at the regional level (South Savo region). Tentative results demonstrate that forest management has a significant role in regional economy. For example, the 10% increase in forest biomass supply relative to regional demand uses indicates an approximately 120 million euro increase to the economy (app. a 2.2% increase in regional GDP) and an increase of 550 person-years in local jobs. However, we found differences between the absolute and relative changes in alternative scenarios. The highest increase in absolute terms was 150 million euros to the regional economy (app. a 2.8% increase in regional GDP) and an increase of 780 person-years in local jobs by 2030. This study introduces a novel methodology of combining the latest forest inventory data with stand projections based on that data, and further, the application of the stand projections as input data for the CGE model. As a result, the effect of forest management on e.g. value added, employment and private consumption at the regional level can be thoroughly estimated.
Keywords:
energy, forestry, modelling, wood, regional, resources
Topic:
Biomass Policies, Markets and Sustainability
Subtopic:
Biomass strategies and policies
Event:
25th European Biomass Conference and Exhibition
Session:
4AV.1.28
Pages:
1581 - 1587
ISBN:
978-88-89407-17-2
Paper DOI:
10.5071/25thEUBCE2017-4AV.1.28
Price:
FREE
