The economic and emissions benefits of engineered wood products in a low-carbon future

Abstract

There has been rapid growth in the use of engineered wood products in the construction sector in recent decades. We evaluate the economy-wide impacts of replacing carbon-intensive construction inputs, such as steel and cement, with lumber products in the US under an emissions constraint. We find that the ability to substitute lumber-based building materials increases production from the lumber and forestry sectors and decreases production from carbon-intensive sectors such as cement. Under a carbon cap-and-trade policy, the ability to substitute lumber products lowers the carbon price and the GDP cost of meeting the carbon cap, with more overall emissions abatement in the construction industry.