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This paper quantifies the economic impacts of flooding in the Ba River and Penang River catchments in Viti Levu, Fiji. We conducted a detailed assessment of flood damage stemming from two major flooding events in 2012 that severely affected the two important catchments, primarily by using evidence from a novel survey administered in early 2013. We combine these empirical measures of damage with GIS data to estimate total damages from flooding and find that the January 2012 flood caused FJ$36.4 and FJ$12.2 in damages for the Ba River and Penang River catchments, respectively, while the March 2012 flood caused FJ$24.1 and FJ$8.4 in damages for the Ba River and Penang River catchments, respectively. We then estimate the cost of future flooding under moderate and severe climate change projections. Flooding is projected to become more frequent and more severe under both scenarios, with annual losses increasing by 100% with moderate climate change and by 300% with severe climate change. For perspective, damages from a 1-in-50 year flood, which is the estimated return period of the January 2012 event, are projected to cause between FJ$76.5 and FJ$153 million in damages in the Ba River Catchment under these two scenarios.

Agricultural and forestry GHG emissions are a key feature of New Zealand’s emissions profile, and New Zealand is the only country, to date, to have indicated that agricultural and forestry emissions will be covered under their domestic climate policy – the New Zealand Emissions Trading Scheme. Coupled with climate policy development is the increasing scrutiny of agricultural impacts on water. This paper uses New Zealand Forest and Agriculture Regional Model (NZ-FARM) to assess the potential economic and environmental impacts of imposing both a climate and nutrient reduction policy on the agricultural and forestry industries in the Manawatu and Hurunui/Waiau catchments in New Zealand. We find that adding a scheme that reduces catchment-level nutrients by 20% on top of a national policy that puts a price of $25 per ton carbon dioxide equivalent on agricultural GHG emissions could result in greater environmental benefits at a relatively small cost, but the converse is not always true and could be significantly more costly for landowners.

While greenhouse gas emissions trading schemes, taxes and other measures have already been implemented or are proposed in many countries and regions, global action to mitigate climate change remains insufficient. A major concern in many countries is that actions taken alone, or even in a limited coalition of countries, might result in competitive disadvantage to firms in emissions-intensive, tradeexposed industries. Additionally, this might results in emissions leakage, reducing environmental effectiveness. The problem of emissions leakage has been extensively studied in the case of mitigation by individual or coalitions of developed countries, most often, using comparative static partial or general equilibrium models. In this paper we use a multiregional dynamic general equilibrium model to study the imposition of harmonised carbon taxes on industrial and energy greenhouse gas emissions in OECD countries and in China. This tax rate is increasing over time. We find that the overall rate of emissions leakage is very low and decreases over time. We also find significant differences between regions in the marginal rates of leakage with respect to their participation (or not) in the carbon-pricing coalition. Differences in leakage rates and their change over time can be related to differences in energy systems, general economic structure and growth rates.

Agricultural and forestry GHG emissions are a key feature of New Zealand’s emissions profile, and New Zealand is the only country, to date, to have indicated that agricultural and forestry emissions will be covered under their domestic climate policy – the New Zealand Emissions Trading Scheme. Coupled with climate policy development is the increasing scrutiny of agricultural impacts on water. This paper uses New Zealand Forest and Agriculture Regional Model (NZ-FARM) to assess the potential economic and environmental impacts of imposing both a climate and nutrient reduction policy on the agricultural and forestry industries in the Manawatu and Hurunui/Waiau catchments in New Zealand. We find that adding a scheme that reduces catchment-level nutrients by 20% on top of a national policy that puts a price of $25 per ton carbon dioxide equivalent on agricultural GHG emissions could result in greater environmental benefits at a relatively small cost, but the converse is not always true and could be significantly more costly for landowners.

Adequately representing dynamic characteristics of land use change and forestry in computable general equilibrium models is challenging but essential if modellers are to provide credible assessments of policies that directly or indirectly influence these phenomena. In this paper, we show how a dynamic representation of planted or naturally regenerating forests may be integrated within a neoclassical, intertemporal general equilibrium model. We demonstrate the application of such a model to assess the impacts of including forestry within a hypothetical emissions trading scheme in the US, showing the resulting changes in land use and increases in the optimal rotation length.

This paper uses an economic catchment model to assess changes in land use, enterprise distribution, greenhouse gas emissions and nutrient loading levels from a series of policies that introduce carbon prices or nutrient reduction caps on land-based production in the Hurunui Catchment in Canterbury, New Zealand. At $20/tCO2e, net revenue for the catchment is reduced by 7% from baseline levels while GHGs are reduced by 3%. At $40/ tCO2e, net revenue is reduced by 15% while GHGs are reduced by 21%. Nitrogen and phosphorous loading levels within the catchment were also reduced when landowners face a carbon price, thus providing other benefits to the environment. Additional scenarios in this paper assess the impacts from developing a large-scale irrigation project within the catchment. Results show that while adding irrigation can improve farm output and revenue, it also results in dramatically higher GHG emissions and nutrient loads. Placing a carbon price on land-based activities diminishes some of these pollutants, but not at the same rate as when the policy what enacted on the baseline irrigation levels. Finally, we investigate the impacts of imposing a nutrient loading cap on farm activities instead of a carbon price and find that if landowners had greater access to irrigation but were constrained to hold the nutrient loads at baseline levels, revenue could increase by 6% over the baseline while GHG emissions could be reduced by 5%. Our findings suggest that while there is a potentially a strong trade-off between water quantity and water quality in the Hurunui Catchment, imposing the right policy levers could reduce some of the environmental impacts from an increase in land-use intensity without placing a large economic or regulatory burden on its landowners.

Agricultural and forestry greenhouse gas (GHG) emissions are a key feature of New Zealand’s emissions profile, and New Zealand is the only country, to date, to have indicated that agricultural and forestry emissions will be covered under their domestic climate policy – the New Zealand Emissions Trading Scheme (NZETS). Forestry entered the NZETS in 2008 while agricultural emissions are expected to enter in 2015. Coupled with climate policy development is the increasing scrutiny of agricultural impacts on water in New Zealand. Given the multiple forms of environmental regulation facing the agricultural and forestry industries we explore, at the catchment level, the impacts of climate policy on the agricultural and forestry industries, including those on farm returns, GHG emissions, carbon sequestration, water quality and induced land use change. We use the recently developed New Zealand Forest and Agriculture Regional Model (NZ-FARM) to assess potential economic and environmental impacts of a climate policy that imposes a series of carbon prices on GHG emissions of land-based production in the Manawatu and Hurunui/Waiau catchments in New Zealand.

A key consideration for development of energy and climate policy affecting the forestry and agricultural sectors is that the selection of specific mechanisms implemented to achieve bioenergy production and/or greenhouse gas (GHG) mitigation targets may have substantial effects on landowner incentives to adopt alternative practices. For instance, the prices of allowances and offsets are expected to diverge under some policies being considered where there is a binding cap on the quantity of offsets from the agricultural and forest sectors. In addition, provisions that limit or exclude specific practices from receiving carbon payments will affect the quantity and cost of GHG mitigation opportunities available. In this study, the recently updated Forest and Agriculture Sector Optimization Model with GHGs (FASOMGHG) was used to estimate GHG mitigation potential for private land in the contiguous U.S. under a variety of GHG price policies. Model scenarios suggest that U.S. forestry and agriculture could provide mitigation of 200 – 1000 megatons carbon dioxide equivalent per year (Mt CO2e/year) at carbon prices of $15 to $50/tCO2e. Binding limits on offsets have increasingly large effects on both the total magnitude and distribution of GHG mitigation across options over time. In addition, discounting or excluding payments for forest sinks can reduce annualized land-based mitigation potential 37-90 percent relative to the full eligibility scenario whereas discounting or excluding agricultural practices reduces mitigation potential by less than 10 percent.