East Texas
Gan and Smith (2006) studied 43 counties in East Texas to determine the socioeconomic effects that logging residue procurement and electricity production would have on the region. The study area (at right) consists of 11.9 million acres of timberland, the majority (93%) of which is controlled by private owners including non-industrial private landowners, the forest products industry, and institutions.
Forestry and the forest products industry have traditionally played a significant role in the regions economy, providing $4.5 billion in output and a total of approximately 100,000 jobs in the region in 1996 (Dreesen and others 2000). Yet, recently the industry has suffered from mill closures and decreases in stumpage prices. Another important industry in the region is the energy sector, which accounts for approximately 22% of the regions total output (IMPLAN 2002). The combination of the forest products and energy industries makes the area a good candidate for producing bioenergy from forest biomass resources. The chart below depicts the importance of the logging and energy sectors to the regions economy.
Using the Input-Output modeling approach, the study revealed that logging residue procurement would generate 568 new jobs, and that electricity production using the residues would generate an additional 769 jobs. The total jobs created, which reflected direct, indirect, and induced impacts, would count for approximately 32.5% of the total current logging employment in the region. The estimated employment multiplier was 3.26. This suggests a strong ripple effect caused by biomass and bioenergy development in the region.
In addition to job creation, bioenergy development would generate $215 million in value-added, with $169.3 million from electricity production and $45.8 million from residue procurement. This is approximately 60% of the current value-added from the logging industry. Moreover, the total impact on output was estimated at $352 million of which $105 million was attributed to logging residue procurement. This total is 38.5% of the current total output from the logging sector. The output and value-added multipliers are smaller than the employment multiplier, suggesting that bioenergy development would have a stronger ripple on employment than on output or value-added. Employment and income affects are shown in the figure to the right.
While this study indicated a positive socioeconomic effect of bioenergy development on the regions economy, it is important to remember that this cannot be generalized for all areas. The impact of biomass and bioenergy development is closely related to such factors as the nature of technology, local economic structures, social profiles, and production processes. Thus, it is important to perform a region-specific assessment before proceeding with any development project.
Encyclopedia ID: p1169
