Global Land Use Impacts of U.S. Ethanol: Revised Analysis Using GDyn-BIO Framework

This paper describes dynamic extension of the comparative static computable general equilibrium (CGE) GTAP-BIO model—framework employed in assessments of biofuel policies. In the dynamic extension, called GDyn-BIO, several structural components of the static model, including food demand responses to higher incomes and intensification options in land-based sectors and food processing, were revised to better capture changes in derived demand for land under pressure of growing population and per capita incomes. The impact of 15-billion gallon biofuel mandate on land use, analyzed with the GDyn-BIO model, evolves significantly over time. In particular, net global cropland brought into production due to the mandate declines over time, which is in sharp contrast to the results of static analysis where policy impacts are pictured as fixed for the next 30 years. Despite the fact that land use change impacts of this policy are transitory, environmental impacts and the global warming implications of such policies should not be underestimated. The policy causes earlier conversion of forest and pasture lands to cropland, resulting in earlier GHG emissions and lost carbon sequestration that contribute to global warming.