Integrated Forestry Ozone Regulatory Modeling System (InFORMS) Economic Benefits of Reduced Ozone Damage to Eastern US Forests Resulting from US EPA

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Integrated Forestry Ozone Regulatory Modeling
System (InFORMS)Economic Benefits of Reduced
Ozone Damage to Eastern US Forests Resulting
from US EPAs Heavy Duty Engine/Diesel Fuel Final
Rule Brief Discussion of Forestry Aesthetics

• Bryan Hubbell,1 Patricia Koman,1 John
  Laurence,2 Brian Heninger,3 Andrea Petro,4 John
  Mills,5 and Richard Haynes 5, Yewah Lau1
• Presented by Linda M. Chappell Ph.D.1

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• 1US Environmental Protection Agency, Office of
  Air Quality Planning and Standards, Innovative
  Strategies and Economics Group, Research Triangle
  Park, NC 27711
• 2US Environmental Protection Agency, Office of
  Research and Development, NHEERL, Western Ecology
  Division, Corvallis, Oregon 97330 and Boyce
  Thompson Institute for Plant Research, Cornell
  University, Ithaca, NY, 14853
• 3US Environmental Protection Agency, National
  Center for Environmental Economics, 1200
  Pennsylvania Ave, Washington, DC 20460
• 4Indiana University, School of Public and
  Environmental Affairs, 1315 E. 10th Street,
  Bloomington, IN 47405
• 5US Forest Service, Pacific Northwest Research
  Station, 1221 SW Yamhill, Suite 200, Portland, OR
  97208
• For More Information www.epa.gov/otaq/diesel.htm
  or ww.fs.fed.us/pnw/serv/rpa/model.htm

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• The US EPA finalized the Heavy Duty Engine/Diesel
  Fuel rule in December 2000. The NOx emissions
  reductions from this rule contribute to a
  constellation of beneficial ecosystem effects
  related to forest health.
• We focused on commercial forest productivity
  benefits of reduced ozone damage to Eastern U.S.
  forests that will result from reductions in NOx
  emissions when the policy is fully phased in.
• For commercial forestry, well-developed
  techniques are available to estimate biological
  and market changes independently however, this
  is the first time we have integrated them as we
  have here in the Integrated Forestry Ozone
  Regulatory Modeling System (InFORMS).

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• Our modeling framework integrates
• Atmospheric Chemistry modeled future ozone
  concentrations from Urban Airshed Model (UAM-V)
• Biology species-specific concentration-response
  functions estimated from TREGRO model simulations
  and USDAs Forest Inventory Analysis data and
• Economics modeled by the Timber Assessment
  Market Model (TAMM)/Aggregated Timberland
  Assessment System (ATLAS).
• Annual benefits sum of the annualized present
  value of the stream of benefits (change in
  consumer and producer surplus) over a 30 year
  period plus the annualized present value of
  additional accumulated forest inventories.

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Biological Inputs
Air Quality Inputs
Model TREGRO Scope 6 Species in 6 Eastern
regions at county level Metric Relative Stem
Biomass Loss Concentration-Response functions
Model UAM-V Scope Eastern US at county
level Metric SUM06 in 2030 for base case and HD
Engine/Diesel Fuel control scenario
County-level Growth Adjustment Factors by Species
Multi-Stage Weighting Process
(1) Assign weights based on county-level
species-specific biomass estimates
(2) Aggregate county data to TAMM/ATLAS Regions
by species
(3) Aggregate species to ATLAS forest types
within TAMM/ATLAS Regions.
Economic Modeling
Model TAMM/ATLAS Scope National with Eastern
O3 changes only assumes no change in West or
Canada Metric Net Present Value of changes in
producer and consumer surplus and value of
stumpage inventory from 2020 to 2050
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Air Quality Inputs UAM-V

• US EPAs Urban Airshed Model
• Predicting county-level year-round ozone
  concentrations
• Eastern domain only

• In year 2030 with and without the HD Engine/
  Diesel Fuel rule
• Policy fully implemented in 2030 with truck fleet
  turn-over
• Ozone season (May September) using eVNA to
  interpolate data

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Air Quality Inputs UAM-V
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Biological Inputs TREGRO

• Using TREGRO-derived region-specific functions
  relating biomass loss to changes in ozone in 6
  species
• Black Cherry
• Loblolly Pine
• Red Oak
• Red Spruce
• Sugar Maple
• Tulip Poplar

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Biological Inputs TREGRO Zones
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Multi-Stage Weighting Process

TREGRO Function
To set up the economic model we must know what
portion of the ATLAS forest inventory is affected
by ozone changes from the policy (for the species
and areas we are able to quantify).
ozone
Growth
County X
ATLAS Regions and Forest Types (e.g., Lowland
hardwood)
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Multi-Stage Weighting Process

• Analytical Steps
• Assign weights based on county-level
  species-specific biomass estimates
• Aggregate county data to TAMM/ATLAS regions by
  species
• Aggregate species to ATLAS forest types within
  TAMM/ATLAS regions

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Change in Growth Adjustment Factors (x 10-6)
TAMM Region Black Cherry Loblolly Pine Red Oak Red Spruce Sugar Maple Tulip Poplar
Plain Central States 295 0 64 0 14 0
Lake States 411 0 2 8 12 85
Northeast 702 182 5 811 38 89
South Central 373 231 176 0 10 53
Southeast 9,841 786 256 0 790 233
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Economic Modeling TAMM/ATLAS

• TAMM evaluates timber production and market
  changes
• Spatial model of solidwood and timber inventory
  in US
• Timber price, quantity
• Net change in consumer and producer surplus and
  change in value of accumulated inventories
• Area for further research and analysis

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Research Needs for Economic Benefits Analysis
Biological Inputs
Air Quality Inputs
Additional species parameterized extrapolations
to other species Stand-level interactions
(Zelig) Western tree inventories Non-timber
related values
Western US air quality changes Model performance
in rural/remote settings Canadian air quality
changes Multi-year modeling
Economic Modeling
Ability to model long time horizons and
sensitivities to assumptions Comparison with
Forest and Agricultural Sector Optimization Model
(FASOM) in which long-term trends may be changed
and the Subregional Timber Supply Model (STSM)
that may be better able to handle marginal impacts
See next slide
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Additional Species Parameterized

• Ponderosa Pine, Red Maple, American Basswood,
  Chestnut Oak, White Ash, and White Fir
• Enhances coverage of marketable species in the US

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Forestry Aesthetics

• Air pollution can cause a range of visual
  injuries to forest (discoloration of leaves to
  extensive defoliation and death of trees).
• Pollutants that may cause visual forestry
  symptoms include tropospheric ozone, sulfur
  dioxide, hydrogen sulfide (other pollutants
  include mineral acids, heavy metal such as lead
  and mercury, nitrogen oxides, ammonia,
  peroxyacetyl nitrate, chlorides, and ethylene).
• Evidence indicates people value forest aesthetics
  and change outdoor recreational behavior
  according to the quality of forest health

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Limited Analysis

• Benefits Cost of the Clean Air Act 1990 to 2010
  evaluates this category of benefits as an
  illustrative calculation.
• Research needs include
• Natural science component of assessment (trends
  in forest health, links between forest health and
  air pollution, and dose-response relationships)
• Economic valuation studies
• Long-term monitoring networks that are capable of
  linking causal agent(s) to forestry aesthetics

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Progress has occurred in the area of commercial
forestry benefit assessments! Much work is
required to assess economic aesthetic forestry
benefits with any degree of specificity!
Conclusions