Spatially explicit benefit-cost analysis of fire management for greenhouse gas abatement

This paper examines the economic potential for fire management to provide offsets to carbon markets in the savannas of northern Australia. Long-term field trials in Australia's savannas have quantified greenhouse gas (GHG) emissions abatement resulting from improved fire management. However, little is known about the economic potential of fire management projects or the locations where projects might be economically viable for providing GHG offsets. A benefit–cost analysis of fire management for GHG offsets is presented here, which includes spatially explicit estimates for GHG abatement under three assumptions of management efficacy (conservative, empirically based, upper potential). The total supply of GHG abatement is estimated under different prices and management efficacy assumptions, and areas that pass the benefit–cost analysis are identified. At the Australian Government's carbon price of A$23 per metric tonne of carbon dioxide equivalents (CO2-e), fire management would be economically viable across 51 million hectares, all within the higher monsoonal rainfall regions of northern Australia, abating 1.6 million tonnes of CO2-e per year. These estimates suggest that fire management projects can contribute to GHG abatement targets and be financially viable across large areas of northern Australia. Additional benefits are anticipated from these projects for biodiversity conservation, livelihoods for indigenous Australians and economic development in remote regions.