Keywords

12.1 Climate Change and the Forest Sector in Germany

Climate change is exerting unprecedented pressure on German forests and their capacity to deliver ecosystem services, with an increase in drought, bark beetle and wind damage during the last few years. This poses a major challenge for the management of forest resources, where we need to not only balance the provisioning of different ecosystem services, but also anticipate and adapt to future climate impacts, and enhance the role of forest ecosystems in climate-mitigation portfolios. This is a difficult task, since the multiple uses of forests may give rise to trade-offs that need to be resolved, especially those concerning wood production goals, biodiversity conservation and climate protection (German Advisory Council on Global Change [WBGU] 2020).

Climate-smart forestry (CSF) has recently emerged as a framework for tackling these issues and enhancing the mitigation potential of forest ecosystems, while acknowledging the effects of climate change on forest dynamics and taking action to overcome these. Simultaneously, it considers the socioeconomic aspects of forest management (Nabuurs et al. 2017). In this context, policy and management must seek efficient solutions for the forest sector in order to mitigate climate change. The promotion of more-stable species compositions and higher structural diversity via modifications to the thinning and harvesting regimes have been proposed as a way of coordinating the adaptation and mitigation role of forest ecosystems in climate-mitigation efforts (Verkerk et al. 2020). Similarly, a focus on policies that promote the substitution effects of fossil-intensive materials by wood products has been viewed as a cost-effective way towards climate neutrality.

Forests cover approximately one-third of Germany’s territory (Table 12.1). German forests are among the most productive forests in Europe, with an average annual increment of 11.2 m3 ha−1 year−1, and are thus in a position to contribute considerably to mitigation as part of a CSF approach. For example, in the period from 2002 to 2012, an average of around 76 million m3/year were harvested in German forests. This is clearly below the average annual increment, highlighting the potential for an increase in the mitigation potential via carbon storage in wood products and substitution effects.

Table 12.1 Overview of the forest sector in Germany
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Germany has set national targets for climate mitigation via forest ecosystems. Among the milestones proposed for the next decade are: a conversion towards mixed and climate-adapted forests; a stronger control on the sustainability of imported solid biofuels; an increase in forest area; a reduction in the emissions related to forest soils, especially on drained peatlands; and a reduction in land take to less than 30 ha day−1. The forest-based sector in Germany can contribute to climate mitigation via three channels––forest sinks, substitution and storage (in wood products). Given this, it is important to consider how these channels could be used to increasingly contribute to climate mitigation, as well as simultaneously adapting the forests to the changing climate.

Here, we address the issues introduced above, starting with an outline of the main impacts of climate change on German forests, including the effects of changing precipitation regimes, temperatures and increased disturbance activity. Subsequently, we employ a simulation-optimisation model to assess the potential mitigation of German forests under climate change up to the end of the century, using a process-based model. We further discuss climate adaptation approaches and the options available to deal with the impacts of climate change. Finally, we outline future measures for the forest sector in Germany that will increase its climate-mitigation potential while observing the need to adapt forests to future climatic conditions.

12.2 Impacts of Climate Change

Climate change and its impacts on forests has been an important topic for practitioners and scientists for more than two decades. Due to the federal system in Germany, however, a consistent and unified strategy for the whole country has never been implemented. Instead, the different states (i.e. Bundesländer) have come up with individual approaches to deal with the ever-increasing, mostly negative impacts of climate change on forests, such as the biotic and abiotic disturbances that have, in recent years, reached critical levels across the whole country (see below).

Bolte et al. (2009) analysed the need and strategies for forest management measures to enhance adaptation to climate change in the German states. The important role of increasing biotic threats has been acknowledged by all stakeholders. Only slight differences have been found regarding tree species’ adaptive potential to climate change, with Norway spruce expected to have a low adaptive potential, while introduced species, such as Douglas fir and red oak, have been assumed to be more adaptive. Several native species, such as European beech, have been considered as being quite tolerant in the face of climate change effects. The most obvious differences detected were regarding adaptation strategies. While some states have preferred active adaptation (e.g. forest transformation aimed at replacing sensitive tree species), others have come out more in favour of a combination of active adaptation and risk minimisation strategies (e.g. by establishing tree species mixtures). Passive adaptation has predominantly been a less-preferred option.

Since Bolte et al.’s (2009) assessment, the situation in Germany’s forests has––similarly to the rest of Europe––dramatically changed. A series of storms, extreme drought events and bark-beetle attacks, in addition to forest fires in 2018–2020, have led to the greatest amount of forest damage in Germany since World War II. The Federal Ministry of Agriculture and Consumer Protection (BMEL) has estimated that, in 2018–2020, around 180 million m3 of wood have been damaged, and an area of 285,000 ha has had to be reforested (BMEL 2020/Internet source no. 3). Most of the damage is directly associated with the impacts of climate change. Norway spruce and Scots pine are the tree species that have been most affected, but native species, such as European beech and silver fir, have also exhibited severe problems. This casts doubt on the hypothesis that a more ‘natural’ forest composition, in terms of species, would significantly increase the resistance and resilience of forests in Germany under climate change. In 2020, the German government assigned the record sum of almost €550 million to support forest owners in dealing with the damage. Discussion on how to best use these funds is ongoing.

12.3 Economic Implications and the Potential for Climate-Change Mitigation

12.3.1 Economic Costs

Hanewinkel et al. (2010) calculated the economic effects of a predicted climate-change-induced shift from Norway spruce to European beech in a forest area of 1.3 million ha in southwestern Germany. The predicted shift led to a reduction in the potential area of Norway spruce by between 190,000 and 860,000 ha. The financial effect of this reduction on the land expectation value was estimated to be between €690 million and €3.1 billion. Using a similar methodological approach (see Hanewinkel et al. 2013), the total loss in German forest area (11 million ha) would equate to around €11 billion. This figure is, of course, subject to considerable uncertainty, yet it shows that the economic impacts of climate change on forests can be severe. In Germany, the timber industry relies, to a large degree, on coniferous species. These tree species are especially vulnerable to climate change, suggesting that the forest industry may be at significant risk in the future.

Bösch et al. (2017, 2019) assessed the costs and carbon sequestration potential of selected forest management measures in Germany, including the effects on the harvested-wood products pool, within a framework that accounted for both the financial impacts on the downstream industries and those on the values of non-market goods and forest services. They showed that these costs could amount to several billion euros per year, and that the cost-effectiveness could be very low. That is, the abatement costs per ton of CO2 may be very high due to the high environmental costs.

12.3.2 Potential for Mitigation

Germany’s forests are considered to be an important part in the climate-change mitigation strategy of the country. However, similarly to the forests in the EU (Nabuurs et al. 2017), their potential in that respect is still underused.

According to Wissenschaftlicher Beirat (2016), the annual potential of forests in Germany to mitigate greenhouse gases through sequestration and the substitution effects of wood products is estimated to be 127 Mt. CO2eq. This is equal to 16% of Germany’s greenhouse gas emissions in 2019 (805 Mt. CO2eq.), a figure that is slightly higher than the one reported by Nabuurs et al. (2017) for the EU. Indeed, Wissenschaftlicher Beirat (2016) considered forests to be one of the most efficient terrestrial sinks in Germany.

Here, we employed a simulation-optimisation model, developed by Yousefpour et al. (2018), to assess the potential for increasing carbon sequestration in German forests along the lines of the CSF approach. We searched for optimal combinations of forest profitability (in terms of the net present value [NPV] of harvestings) and carbon sequestration in situ. We applied the approach to Germany under different climate-change scenarios, using a process-based forest-growth model to forecast future sequestration potential up to the end of the century. Subsequently, we identified management regimes that could realise these optimal combinations and assess the costs related to carbon sequestration. A central aspect of this analysis and CSF is the allocation of climate-mitigation actions to areas with simultaneously high sequestration potential and low opportunity costs, thereby increasing the efficiency of forestland use. In this sense, we also selected the species best suited for climate-mitigation actions. To this end, carbon sequestration was discounted in order to consider the urgency of the climate-mitigation actions using a 2% discount rate. Consequently, the carbon sequestration is expressed as present tons equivalent (PTE), meaning that 100 t of C sequestered 10 years in the future would represent 82 PTE. Wood-harvesting revenues were discounted using a 0.54% interest rate (Yousefpour et al. 2018).

As expected, forest profitability and carbon sequestration displayed a trade-off, since higher levels of carbon storage in the forests resulted in a decrease in wood utilisation and a reduction in harvesting revenues (Fig. 12.1). Therefore, forest owners applying climate-mitigation-oriented management would lose stumpage income (i.e. incur opportunity costs), which depends on the profitability of forest stands and their species composition. Figure 12.1a illustrates the total cost of generating additional carbon sequestration, in terms of NPV, compared to the baseline. For example, an additional sequestration of 2.5 PTE of C ha−1 year−1 would require a compensation to forest owners in the range of €15–30 thousand ha−1, with highest compensation required for oak and spruce forests. Beech and pine stands had the lowest compensation costs of about €15 thousand ha−1. These patterns were maintained in the carbon supply curve for each species (Fig. 12.1c), which indicates the amount of increase in carbon sequestration that owners would be willing to adopt at different compensation levels (i.e. the carbon price), with the maximum compensation ranging from €100 to €239 PTE−1 for beech and oak stands, respectively.

Fig. 12.1
A chart of three line graphs and one area graph. A is a line graph of total cost versus carbon sequestration. B is an area graph of carbon sequestered versus preference for carbon sequestration. C is a line graph of marginal cost versus carbon sequestration. D is a line graph of additional carbon sequestered versus carbon price. Each graph plots data for beech, oak, pine, and spruce. All curves in A are concave up increasing, in C they are concave down increasing, while in D the curves are concave up increasing till certain carbon prices are reached and saturate thereafter. In D, the area covered by beech is the highest, followed by oak, pine, and spruce.

Results of the multi-objective optimisation model for balancing forest profitability and carbon sequestration for the most abundant tree species in Germany. (a) Total cost incurred to increase carbon-sequestration (in PTE) levels in situ for the different species analysed. (b) Levels of carbon sequestration attained with different preferences for carbon sequestration over forest profitability. (c) Marginal cost curve for increasing carbon sequestration (i.e. the carbon supply curve). (d) Allocated sequestration potential for each species with increasing carbon price

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Realisation of the maximum sequestration potential in Germany’s forests may increase the carbon uptake nearly threefold compared to the baseline management (Fig. 12.1b). Similarly to the supply function and total cost, different species displayed varying sequestration potential. This resulted from both the total areal share of the species and the biological potential (i.e. the carbon sequestration rates). Taking into account the maximum sequestration potential, spruce represented 36% of the total sequestration share, followed by pine (25%), beech (23%) and oak (16%) stands. Spruce stands had the largest share of forest area and growth rates, leading to higher sequestration levels. Despite the similar areal coverage, pine stands produced a smaller contribution, resulting from the lower growth rates of this species and the typically poorer sites it occupies, predominantly in sandy soils, which also have lower carbon storage capacity.

Considering that different species display diverging potentials to deliver ecosystem services, integrative approaches are required to ensure an efficient use of forest resources (WBGU 2020). For example, the promotion of mixed stands can balance the trade-offs related to production and climate-mitigation goals, as well as increase their resilience to disturbances and reduce the risks of catastrophic carbon losses (Jactel et al. 2017).

Figure 12.1d shows the share of the sequestration capacity realised with increasing compensation levels, up to the maximum potential. Hence, an earlier increase in carbon sequestration indicates a higher suitability of the species for increasing carbon sequestration. We found that pine and beech stands were preferable for mitigation actions, with a full allocation of the forests to carbon storage from compensations above €100 PTE−1, and a slightly better suitability of pine stands. Conversely, spruce and oak stands were fully allocated to carbon sequestration actions only under high compensation payments of above €189 PTE−1 for the former and €228 PTE−1 for the latter.

The carbon sequestration levels computed here amounted to 4–11% of the country’s carbon emissions in 2019–805 Mt. CO2 (or approximately 8–23% if no carbon discounting is applied), which is compatible with previous estimates (Dunger et al. 2014). Therefore, forests may substantially contribute to the realisation of climate targets in the country.

The Wissenschaftlicher Beirat (2016) concluded that, in the agriculture and forestry sectors, forests play the most important role in carbon sequestration. In the package ‘moderate climate protection’, which predicts a mitigation effect of 65 Mt. CO2eq./year, forests are expected to contribute 43% of the total (28 Mt. CO2eq.). In the ‘ambitious climate protection’ case, forestry and HWPs contribute 56 Mt. CO2eq. from a total of 130–135 Mt. CO2eq. Adding this to the actual contribution of almost 130 Mt. from the forestry sector would make up for around 180 Mt. CO2, thus amounting to an impact equal to 22% of the current level of yearly greenhouse gas emissions.

The potential to improve the mitigation effect of Germany’s forests and the forest sector is of the same magnitude as Nabuurs et al. (2017) estimated for the impact of CSF measures on the whole of the EU (25%). However, it should be noted that the simulation analysis for Germany has several limitations. First, the potential to increase the forest area in Germany is naturally limited due to the high population density (250 people/km2) and high pressure on land use for buildings and infrastructure, especially around the urban areas. Second, Germany already has a comparably high standing volume per hectare, limiting the increase in carbon in the living biomass. An Öko-Institut (2018) study indicated that the standing volume in Germany could be doubled, but we consider this to be unrealistic. Third, the potential to increase the standing volume by improved management through the conversion of coppice forests into high forests is limited, as coppices play virtually no role in management schemes in Germany. Fourth, Germany’s forests are under increasing pressure from abiotic and biotic disturbances, as can be seen in the devastating drought and bark-beetle damage from 2018 to 2020. Hence, a high accumulation of biomass by CSF actions may increase the vulnerability of stands to windstorms and drought occurrences (e.g. Temperli et al. 2020). Similarly, fuel accumulation in unmanaged pine stands may pose the risk of wildfires, and extreme damage events in spruce stands may trigger the occurrence of bark-beetle outbreaks. The occurrence of such disturbance events could thus hinder climate-mitigation actions (Seidl et al. 2014).

12.4 The Role of Forest Products

The previous analysis only considered the role of forests in mitigation (and adaptation), but wood products can also play a significant role in the mitigation potential of the forest sector. Germany is a major producer of sawnwood and wood panels, and both the carbon storage in wood products and the substitution of wood for energy-intensive materials, especially in the construction sector, may contribute substantially to climate targets.

Bösch et al. (2017) estimated that wood substitution effects were up to the same order of magnitude––up to 18 Mt. CO2 year−1––as the forest carbon sink, depending on the wood utilisation scenario. It should be noted, however, that an increase in the mitigation potential associated with substitution effects was accompanied by a decrease in the sequestration potential of the forests due to the higher levels of wood removal.

Recent investments have been made in Germany to increase the production of new biomaterials and products that can replace fossil-based products. For example, UPM Biofuels has invested in a new biorefinery plant in the city of Leuna, with the capacity to produce 220,000 t of biochemicals annually (UPM Biofuels 2020). These biochemicals will enable a switch from fossil-based products to sustainable alternatives over a range of end uses, such as plastics, textiles, cosmetics and industrial applications. The plant is planned to start producing by the end of 2022. In 2020, the German government set out plans to accelerate its low-carbon transition by investing €3.6 billion in projects that help to strengthen its bioeconomy and create a market for bio-based products (https://biomarketinsights.com/germany-backs-e3-6bn-plan-to-support-bioeconomy-and-bio-based-products/).

An increase in the utilisation of wood products and improvements in the stewardship of wood imports are also predicted in the national climate action plan. The removal of barriers to the use of durable wood products (e.g. building regulations) and further investment in research and development towards the creation of new wood products are also being promoted, highlighting the importance of wood-based materials in the country’s climate-mitigation portfolio. In addition, the WBGU (2020) has recommended boosting the use of timber in construction. According to the WBGU, timber from locally adapted, sustainable forestry offers effective possibilities for long-term carbon storage.

12.5 Nexus of Adaptation, Resilience and Mitigation: What Is the Right Way Forward?

Currently, because of the severe damage being done to forests in Germany, a public discussion has developed on how to manage forests under the impacts of climate change and how best to adapt the forests and increase their resistance and resilience to the changing environmental conditions. As this discussion has to do with the optimal strategy for combining mitigation and adaptation, it directly touches upon CSF.

It seems that two different groups have emerged, with fundamentally different approaches and opinions on how to manage forests under climate change. One approach, which you might call ‘passive adaptation’, is to keep the forests dense in order to maintain a cooler inner climate, and aims at a spontaneous adaptation using maximum natural processes, which opposes the classical forest management that has been practised over decades. This approach is supported by a highly diverse group, as well as certain specific regions (e.g. the Upper Rhine Valley). Some members of this group have expressed their opinions in an open letter to the Minister of Agriculture, thus putting pressure on politicians and bringing the case to a public debate. The alternative approach to this is what you might call the ‘active adaptation approach’, which aims at anticipating and adapting to the expected pressures posed by climate change. For example, promoting mixed forest stands, including the implementation of non-native species, and replanting large areas destroyed by drought and consecutive bark-beetle attacks with more resilient forest compositions. This active-adaptation approach has been supported by an official statement from the Scientific Board for forest policy of the Ministry of Agriculture and another official statement from the majority of German forest scientists (Deutscher Verband Forstlicher Forschungsanstalten [DVFFA] 2019).

The CSF (Chap. 9) approach combines all forest-based-sector mitigation possibilities (sink, substitution and storage) and adaption in a holistic way. Regarding adaptation, we point to a generic concept that has recently been developed (Yousefpour et al. 2017), which takes into account the cost efficiency (Fig. 12.2). According to this, a business-as-usual (BAU) strategy may still be the optimal choice if the cost of change (adaptation) exceeds the expected benefits. If the climate change impacts are low, a low-cost reactive adaptation may suffice. For scarce and valuable forest resources, especially under considerable climate change impacts, a proactive and robust strategy would be more suitable. The robust strategy is a more costly adaptation strategy, but it represents a better fit to the uncertainties inherent in climate change, and guarantees the provision of ecosystem services under all plausible climate-change scenarios.

Fig. 12.2
A schematic diagram of different adaptation strategies describes their costs, risk aversion capabilities, benefits, and the degree of climate change uncertainty at which their implementation becomes crucial. The strategies in the boxes are: reactive adaptation, active adaptation, robust adaptation, and B A U.

Schematic allocation of different adaptation strategies in terms of costs and benefits under climate change. BAU business as usual

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Besides the importance of active adaptation, the Scientific Board of the Ministry of Agriculture (Wissenschaftlicher Beirat 2016) has proposed a list of measures for forestry and the forest sector to enhance their mitigation effect:

  • Safeguard productive forests to sustainably use their potential for climate protection.

  • Plant adapted and productive tree species, especially drought-tolerant conifers mixed with deciduous tree species.

  • Increase the longevity of timber-based products and promote their cascade usage.

  • Take into account climate protection effects when assigning protected areas in forests.

  • Guarantee the protection of forest soils.

  • Consult with and supervise small and medium private and community forest enterprises to reach climate protection goals.

  • Communicate the positive climate protection services of forestry and the enhancement of timber usage.

  • Giving up forestry and the harvesting of timber is not seen as an appropriate strategy for climate protection in the long run, although it may be an important instrument for achieving specific goals in biodiversity conservation.

From the perspective of the scale of the impact, the greatest mitigation potential in the forest-based sector would be achieved through:

  • Changing the tree species composition in forestry production to generate more stable and resilient forests, capable of producing multiple benefits simultaneously, such as climate mitigation, wood production and habitat protection. This could even include an increase in coniferous species, but of course only mixed with native deciduous species (long-term effectivity).

  • Protecting moors, inside and outside of forests (long-term effectivity).

  • Producing lignocellulose from agricultural production, such as from short-rotation plantations (mid-term effectivity)

  • Increasing the material usage of timber in long-lived timber products (long-term effectivity).

The Scientific Board estimated that the cost of avoiding greenhouse gas emissions in the forestry (and agricultural) sector will be dependent on the site and implementation of the measures, and that these are usually below €50/t CO2eq.

12.6 Conclusions: Mitigation and Adaptation Go Hand in Hand

German forests are characterised by high standing volumes and productivity. They could play an important role in the overall potential of the country to mitigate climate change. Their potential to take up greenhouse gas emissions is in the range of, or even higher than, the average European forest. In addition, Germany is a major producer of sawnwood and wood-based panels, which also offers potential for climate mitigation, in terms of substituting for fossil-based materials and products and storing carbon in wood products.

On the other hand, climate change is already exerting severe economic, environmental and social impacts on German forests and the forest-based sector, and this trend is likely to continue and intensify in the future. There is a political debate taking place about how best to deal with this damage and minimise the risks in the future, asking, for example, how best to optimise the mitigation potential of the forests while at the same time adapting the forests to deal with ongoing climate change. This situation calls for a very careful balancing of strategies and a holistic approach, which the CSF framework can provide.

Our simulation indicated that the opportunity costs of using high-valued and productive species, such as Norway spruce, for mitigation purposes (i.e. by the in-situ accumulation of carbon) produces high opportunity costs, while species of less value, such as European beech, would be better suited for this purpose. In order to follow a systematic approach to addressing the challenges of combining mitigation and adaptation, we propose a generic framework for adaptation that takes into account the cost efficiency of all measures, and includes this in suggesting the most efficient ways to increase the mitigation potential of the forests in Germany. Current and emerging forest bioeconomy products also offer significant potential for the future mitigation potential via substitution and carbon storage.