Feasibility of Community Management of Miombo Woodlands for Carbon Project in Southern Highlands of Tanzania

• Main Authors: Z. J. Lupala, L. P. Lusambo, Y. M. Ngaga
• Format: Article
• Language: English
• Published: Hindawi Limited 2017-01-01
• Series: International Journal of Ecology
• Online Access: http://dx.doi.org/10.1155/2017/8965983
• ISSN: 1687-9708; 1687-9716

In response to the pressing global challenges of climate change, community based management of miombo woodlands in Tanzania is promoted for carbon credit project development. However, evidence on its feasibility is scanty and questionable. This study examined the economic feasibility of carbon credit project development in community based forest management (CBFM) using four similar miombo woodlands from Southern highlands. The analysis was based on 144 sample plots from managed woodlands and 100 plots from business as usual (BAU) (open access). Allometric equation was applied to convert biomass to carbon per hectare. Improved carbon stock was determined and its economic value ascertained based on global voluntary carbon markets. Project feasibility analysis was performed using discounted cash flow, internal rate of return, and benefits/costs methods. Annual opportunity cost and variable costs were subtracted from total revenue to obtain annual net profit. The annual rate of return on investment was calculated by dividing profits by total costs. It was revealed that carbon stock improved significantly in CBFM compared to BAU (P<5%). The improvement had positive net present value and benefit-cost ratio of 1.83. Moreover, sensitivity analysis showed that if any unexpected situation occurs, the project will still be of worthiness. The findings are useful to enrich the debate on carbon credit development under community based management of miombo woodlands in Tanzania.