Opportunities and Prospects for the Implementation of Reforestation Climate Projects in the Forest Steppe: An Economic Assessment

Abstract

New methodologies, rules, modalities, and procedures for the mechanism established under Article 6(4) of the Paris Agreement have led to the need to change the national conditions for the implementation of climate projects, including climate projects in forests. However, the issue of evaluating the effectiveness of such projects and their attractiveness to investors remains controversial, as their place and role in the modern economy remain uncertain. Therefore, the aim of the study was to assess the investment attractiveness and silvicultural feasibility of implementing reforestation climate projects in the central forest steppe of Russia. Thanks to mathematical models (including the developed coefficient of carbon intensity of investment costs) and the calculations carried out, it will be possible to develop a differentiated approach to assessing the investment attractiveness of climate projects’ implementation in forests. Reforestation projects including the planting of fast-growing tree species were considered. Maximum carbon sequestration for these projects is expected to occur over a period of 10–30 years. It was found that the coefficient of carbon intensity of investment costs, discounted by the duration of such projects, may become the basis for decision-making on investments in afforestation and reforestation in the central forest steppe.