Projections using IAMs show that bioenergy demand is very likely to dominate under the 1.5circ to 2circC target scenarios (10). Our study provides a comprehensive outlook of how this bioenergy future will affect forest harvests, prices, timber management investments, the area of forest, and forest carbon balance when market interactions and management responses are considered. Dynamic market and management responses are usually ignored in many environmental studies that provide only a partial view of the ongoing debate about benefits and risks of increasing global bioenergy demand (12–17, 36).

The results show that lower levels of bioenergy demand, consistent with RCPs 4.5 and 6.0, can lead to net carbon emissions if the higher prices encourage more harvesting of natural forests but not enough of an increase in investments in forest regeneration. For RCPs more stringent than 4.5, bioenergy demand is sufficiently high that it encourages strong enough investments in forest management to offset the negative effects of harvesting inaccessible and natural forests. Thus, for these higher levels of bioenergy demand, there are net positive effects on the global carbon balance, although there are notable impacts on natural forests. Across all ranges of bioenergy demand, efficient forest carbon sequestration policies can be deployed to ensure that forests are carbon neutral and that forest carbon stocks are maintained. Further, these efficient policies can significantly reduce the loss of inaccessible and natural forests. In contrast, inefficient policy proposals, such as taxing carbon emissions from biofuels without also accounting for the gains that accrue to forest growth, cause potentially large losses of natural and inaccessible forests and lead to carbon emissions in some circumstances.

There are two important reasons why stocks are enhanced in the face of strongly growing demand. First, when demand grows, prices rise and landowners with growing forests will typically hold trees to take advantage of the rising prices, as there is a higher opportunity cost of felling them prematurely. If the demand for biomass energy turns out to be short-lived, lasting only a couple years, then landowners would be encouraged to harvest trees earlier than otherwise, which would reduce carbon stocks and lead to net emissions. However, biomass energy projections associated with long-run phenomenon like climate change suggest that the demand for wood-based biomass energy will grow over time. Second, rising prices incentivize foresters to increase regeneration and management expenditures. These include replanting, fertilizing, managing for competition, and other practices aimed at increasing the value of and size of the growing stock. Expansion of biomass energy production would increase management over a wide swath of forests around the world, but most intensification would occur in places that are already intensively managed. For context, the stock of forests has increased steadily in the southern United States and has stabilized in the Pacific Northwest since 1950, despite the growth harvesting that continued up to the 1990s (40).

Second, rising prices incentivize foresters to increase regeneration and management expenditures. These include replanting, fertilizing, managing for competition, and other practices aimed at increasing the value of and size of the growing stock. Expansion of biomass energy production would increase management over a wide swath of forests around the world, but most intensification would occur in places that are already intensively managed. For context, the stock of forests has increased steadily in the southern United States and has stabilized in the Pacific Northwest since 1950, despite old growth harvesting that continued up to the 1990s (40).

These findings advance the policy discussion by capturing several dynamics of how landowners respond to incentives, namely, that economic incentives promote more forest management. This outcome is different than that of Schlesinger et al. (26) and others, who do acknowledge regrowth of forests but argue that emissions in the near term are particularly harmful because they cause damages during the entire time it takes for forests to regrow. This stance ignores the benefits of the past accumulation of carbon embodied in current forest stocks, which is an important component of the global carbon budget. The argument can also be extended to the future: Is it fair to hold landowners accountable for today's emissions without considering the benefits of their future regrowth, especially given that the future carbon storage is more valuable than even today's emission?

In addition to increasing the stock of forests, higher prices make forests more resilient to land use change. The real price of forest products has increased since the 1940s, while the real price of crops has fallen. As a result, the area of land in forests in the many parts of the United States and Europe has increased over the same time frame due to afforestation and the abandonment of low-productivity agricultural land (41, 42). Rising prices, however, can encourage landowners with unmanaged, or natural forests, to liquidate their stock sooner than otherwise. If a policy that accounts for forest sequestration, such as the carbon rental policy, is not implemented, bioenergy demand could harm natural forests and the ecosystem and the biodiversity services that they provide. Further, as long as policies are implemented efficiently, large areas of natural forests would remain intact.

This study provides an improved understanding of the benefits and risks of increasing global bioenergy demand on forest area and forest carbon mitigation potential under alternative policy scenarios. However, there are at least two other factors that could be integrated

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