Estimating Marginal Costs of Additional Water Flow from a Loblolly Pine Stand in South Georgia, United States

Abstract

Abstract Certain silvicultural operations enhance the flow of ecosystem services derived from forestlands. Monetary estimates of an increased flow of such services that can impact forest management decisions are generally lacking. Here we use a growth-and-yield model to estimate physical changes in water yield and assign monetary values to these changes under different regimes of forest thinning and planting density in a loblolly pine (Pinus taeda L.) stand located in South Georgia. The model is expanded to develop corresponding measures of water yield and net present value per each management scenario. Results show an expected inverse relationship between average annual water yield and economic rent. Further, the marginal costs associated with producing an extra liter of water (per unit area) decrease as thinning intensifies and planting density declines (US$1.35/kL to US$0.72/kL under a site index of 18.3 m and US$1.20/kL to US$0.66/kL, assuming a site index of 21.3 m) relative to our baseline scenario. We emphasize that a landowner’s profits may be negatively affected by the provision of improved water yield downstream as it competes with timber extraction. Monetary payments are needed to encourage the net production of water from existing loblolly pine stands in South Georgia, United States.