Valuing albedo as an ecosystem service: implications for forest management

Surface albedo is a property of the Earth's surface that provides an important climate regulating ecosystem service through the reflection of incoming solar radiation. In some regions, the cooling effect of higher albedo associated with snow-covered bare ground and young forests, compared to mature forests, can exceed the cooling effect of carbon sequestration from forest growth. Properly assigning an economic value to the net benefits of albedo-related shortwave radiative flux is therefore important in order to understand how these two ecosystem services may tradeoff under different scenarios and in different forests. Here we place an economic value on albedo-related shortwave radiation through the use of shadow prices derived from an integrated assessment model (DICE). We then examine the potential impact of this value on optimal forest rotation in the White Mountain National Forest (WMNF) in the state of New Hampshire, USA. Our results suggest that valuing albedo can shorten optimal rotation periods significantly compared to scenarios where only timber and carbon are considered. For instance, in spruce-fir stands, very short rotation periods of just 25 years become economically optimal when albedo is considered. We attribute this to the low productivity of the sites within the WMNF as well as the substantial snowfall that occurs in the area. Thus, in high latitude forests where snowfall is common and productivity is low, incorporating the valuation of albedo may lead to relatively short optimal rotation periods if the only ecosystem services considered are timber provisioning and climate regulation.