Due to the connections between the climate, energy, and land systems, a carbon price will affect CO2 emissions from land use and CO2 removals from land. There are three main reasons for this behavior:

  1. CO2 fertilization
    In a scenario with high emissions, the additional CO2 in the atmosphere increases net primary productivity (photosynthesis by plants and other organisms), removing more CO2 from the atmosphere. When a carbon price reduces emissions, there is less CO2 in the atmosphere relative to a scenario with a lower carbon price, so the rate of removal of CO2 from the atmosphere via photosynthesis is lower.

  2. Temperature feedback on crop yield
    When a carbon price reduces emissions and therefore temperature, the lower temperature has less of a negative effect on crop yield. If crop yield is higher, there is less deforestation driven by the need for expanding agricultural land.

    Learn more about the relationship between crop yield and temperature in En-ROADS here. 

  3. Economic damage function
    With lower emissions, there is less damage to the economy from temperature, resulting in more growth. Higher economic growth leads to higher demand for food and animal products, leading to deforestation for farmland expansion. This slightly increases CO2 emissions and reduces CO2 removals. Additionally, higher economic growth leads to higher energy demand, including from bioenergy, which leads to more forest degradation for bioenergy.

    Learn more about the economic impact of climate change in En-ROADS here.