French Report Highlights Economic and Environmental Value of Forests Amid Climate Challenges

A recent report by the Council of Economic Analysis (CAE) underscores the crucial role of forests in France's fight against climate change and the need to incorporate their value into national accounting systems. Forests absorb about 10% of the nation's carbon emissions, but their carbon sequestration capacity has halved over the past decade, signaling an urgent need for better management and valuation methods.

The report introduces an innovative accounting method estimating the forest-wood sector's added value at 11.2 billion euros in 2018, significantly higher than its market value. The market value of the forest-wood sector stands at 139 billion euros, while the social value of carbon stored in biomass is even more substantial, approximately 380 billion euros. Other ecosystem services such as hydrological regulation and biodiversity preservation have been valued at 270 billion euros.

The analysis highlights the transient nature of carbon storage in forests and questions the effectiveness of current public subsidies for wood-energy, which may have only a marginal and uncertain climate impact. It recommends prioritizing long-term uses of wood through a cascading approach and advocates integrating the wood sector into CO2 quota markets to balance social costs and benefits.

This comprehensive valuation aims to make the often-implicit environmental costs and benefits visible to policymakers, promoting better forest management and climate policies in France. Such efforts are essential to preserve natural capital and support the nation's carbon neutrality goals. The report emphasizes reliable environmental economic data as critical for informed public decisions, particularly concerning forests' dual ecological and economic roles.