Title: Factors influencing buyers' willingness to offer price premiums for carbon credits sourced from urban forests
Authors: Neelam C. Poudyal; J.M. Bowker; Jacek P. Siry
Department of Forestry, Wildlife and Fisheries, University of Tennessee, 274 Ellington Plant Science Bldg., Knoxville, TN 37996, USA
USDA Forest Service, Southern Research Station, 320 East Green St., Athens, GA 30602, USA
Warnell School of Forestry and Natural Resources, University of Georgia, 180 East Green St., Athens, GA 30602, USA
Abstract: Marketing carbon offset credits generated by urban forest projects could help cities and local governments achieve their financial self-sufficiency and environmental sustainability goals. Understanding the value of carbon credits sourced from urban forests, and the factors that determine buyers' willingness to pay a premium for such credits could benefit cities in strategically marketing carbon credits to generate revenue. This study surveyed business organisations participating in carbon trading in order to explore the factors influencing buyers' willingness to pay for urban forest carbon credits in alternative marketing scenarios (i.e., with and without explicit recognition of purchase). Results suggest that buyers are willing to pay a premium for carbon credits sourced from urban forests and the amount of this premium was influenced by the purchasing business's ownership type, size, geographical scope of operations, and the level of importance placed on the co-benefits provided by urban trees.
Keywords: price premiums; urban forests; ecosystem services; carbon credits; Tobit model; buyers; carbon offset credits; financial self-sufficiency; environmental sustainability; sustainable development; willingness to pay; carbon trading; firm ownership; firm size; geographical scope; co-benefits; urban trees; cities.
Int. J. of Sustainable Society, 2015 Vol.7, No.3, pp.205 - 220
Available online: 20 Aug 2015