Carbon markets have the potential to reward landowners for improved forest management and forest conservation. To date, the Over the Counter (OTC) voluntary market represents the greatest opportunity for forest landowners to participate in carbon transactions. However, lack of a consistent carbon price signal and sporadic demand coupled by high transaction costs has prevented widespread participation from family forest landowners. Adoption of a U.S. based cap-and-trade program reduces price risk and may provide incentives for sustainable forest management across large areas. Yet few studies have examined the supply side of carbon offsets and factors affecting project financial viability. To address this gap, we assessed how (1) property characteristics (i.e. stocking level, forest type, size etc.); (2) silvicultural treatments; and (3) protocol and legislative requirements affect the financial viability of compliance forest offset projects, focusing on California’s Air Resource Board (ARB) program due to its significance as the world’s second largest carbon market.The model developed here can be used by U.S. landowners to assess the financial viability of their property as a compliance offset project and can be utilized by policymakers to develop cost-effective climate change policy.
