Comparative Assessment of the Economic Efficiency of the Afforestation Project in the North-West of Russia

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

The authors of the manuscript have carried out a comparative evaluation of the ecological and economic efficiency of the reforestation project. The aim of the study is to evaluate the sequestration potential of soil-vegetation combinations taking into account the economic efficiency of implementing a nature-based climate project. A sensitivity analysis of the economic efficiency in different scenarios depending on the planted tree species was carried out. The general conclusion of the study is that such projects are generally economically inefficient.

The idea of the study is interesting and promising, and useful results were obtained showing that the achievement of economic efficiency of reforestation projects depends not only on the natural conditions of the site, but also on economic factors. I believe that the work is well conceived, the methods are appropriately developed and the results are well presented. Nevertheless, I am of the opinion that the work should be refined before publication, which is why I make comments below.

 

1. I suggest expanding the Abstract and focusing on the results presented in the paper. The summary explicitly mentions the key findings, which is commendable. However, I believe that specifying the results would provide readers with more detailed information and thus clarify their significance.
2. The literature used is appropriate, but I suggest expanding the list. In the discussion of the results (section 3), a comparison of the results obtained with relevant studies by other authors is missing. The results obtained should be placed in the context of current global research, which would make the methodology developed and the results obtained more significant.
3. It is necessary to refine the methodology of the work, which would allow a better understanding of the results and discussion. For example, the methodology should elaborate more on formula (1) – describe how the parameters CF and i were calculated. The same applies to formula (2) – explain how the number of carbon units was determined.
4. Line 175 – subtitle 3.1 Data Sources and Literature Review – I suggest deleting Literature review, because there is already a title 2. Literature Review.
5. Line 231 - Explain how the value of the discount rate is determined.
6. Line 239 - … The following six options have been selected… - seven options?
7. Line 259 – CO2 – use subscript. Also, apply to the rest of the text.
8. Line 336 – add geodetic coordinates to the image.
9. Line 384 – I propose an explanation for why the carbon unit curve (e.g. in 2050) is declining.
10. Line 401 – I suggest moving the formula to the chapter where the methodology is described.
11. Line 409 same as before.

Author Response

Dear reviewer!

Thank you very much for your suggestions and recommendation!

Detailed replies are given below.

Sincerely yours,

Corresponding author,

Prof. Evgeny Abakumov, Saint-Petersburg State University

 

Reviewer #1

The authors of the manuscript have carried out a comparative evaluation of the ecological and economic efficiency of the reforestation project. The aim of the study is to evaluate the sequestration potential of soil-vegetation combinations taking into account the economic efficiency of implementing a nature-based climate project. A sensitivity analysis of the economic efficiency in different scenarios depending on the planted tree species was carried out. The general conclusion of the study is that such projects are generally economically inefficient.

The idea of the study is interesting and promising, and useful results were obtained showing that the achievement of economic efficiency of reforestation projects depends not only on the natural conditions of the site, but also on economic factors. I believe that the work is well conceived, the methods are appropriately developed and the results are well presented. Nevertheless, I am of the opinion that the work should be refined before publication, which is why I make comments below.

 

1. I suggest expanding the Abstract and focusing on the results presented in the paper. The summary explicitly mentions the key findings, which is commendable. However, I believe that specifying the results would provide readers with more detailed information and thus clarify their significance.

Reply: Thank you for the recommendation. The abstract has been expanded to reflect the results of the article. Done -  Lines 20-22, 27-32.

1. The literature used is appropriate, but I suggest expanding the list. In the discussion of the results (section 3), a comparison of the results obtained with relevant studies by other authors is missing. The results obtained should be placed in the context of current global research, which would make the methodology developed and the results obtained more significant. Reply:  Thank you for the recommendation. The discussion of the results has been expanded. Lines 650-661
2. It is necessary to refine the methodology of the work, which would allow a better understanding of the results and discussion. For example, the methodology should elaborate more on formula (1) – describe how the parameters CF and i were calculated. The same applies to formula (2) – explain how the number of carbon units was determined

Reply:  Thank you for the recommendation. We described the calculation of Cash flow and the discount rate. Done - Line 227-340

1. Line 175 – subtitle 3.1 Data Sources and Literature Review – I suggest deleting Literature review, because there is already a title 2. Literature Review. Reply:  Thank you for the recommendation. Literature review deleted
2. Line 231 - Explain how the value of the discount rate is determined. Reply:  Done -Line 325
3. Line 239 - … The following six options have been selected… - seven options? Reply:  You are absolutely right. Seven options.
4. Line 259 – CO2 – use subscript. Also, apply to the rest of the text. Reply:  Done
5. Line 336 – add geodetic coordinates to the image. Reply:  Done - Line 427-428
6. Line 384 – I propose an explanation for why the carbon unit curve (e.g. in 2050) is declining. Reply:  DoneThe carbon unit curve is explained. Line 516-519
7. Line 401 – I suggest moving the formula to the chapter where the methodology is described. Reply:  Done -Moved
8. Line 409 same as before. Reply:  Done - Moved

Author Response File: Author Response.docx

Reviewer 2 Report

Comments and Suggestions for Authors

REVIEW OF SUBMISSION TO SUSTAINABILITY – 3464826– “COMPARATIVE ASSESSMENT OF THE ECOLOGICAL AND ECONOMIC EFFICIENCY OF THE AFFORESTATION PROJECT IN THE NORTHWEST OF RUSSIA”

 

Summary of the paper

This paper empirically investigates the economic efficiency of pursuing an afforestation project in the Leningrad region of Russia.  The authors identify relevant literature, for coverage in their literature review, from Scopus, Google Scholar and an equivalent Russian database.  They use Net Present Value analysis to model the economic viability of seven different afforestation projects, from the viewpoint of a Small to Medium Enterprise implementing the project.  The initial outlay is modelled as the product of the number of seedlings required for a project and the estimated cost per seedling.  A measure of carbon efficiency, rather than a dollar amount, is discounted.  The base-case cost of capital is 0.19 p.a., obtained from the Russian central bank.  The authors conduct sensitivity analyses.  They conclude that black alder afforestation has the highest economic efficiency.  The discussion alludes to government subsidisation, to rectify the problem that some ecologically efficient afforestation projects may lack economic efficiency.

 

Critical review

The title of the paper and the discussion therein should delete reference to sequestration potential and ecological efficiency.  This paper focuses on economic efficiency.  I suggest the authors analyse the economic efficiency of the suggested afforestation alternatives, on the assumption that they are all ecologically efficient.

 

It seems unnecessary to mention the databases that were searched, to locate the studies covered in the literature review.  It would be more appropriate to focus on the content of these studies and to discuss how the authors’ paper is complementary.  Some discussion of this nature is in the paper.  It warrants more emphasis.

 

Table 2 outlines different modes of economic evaluation of suggested capital investment projects.  These methods are complementary and mutually reinforcing, rather than mutually exclusive.  For example, “economic efficiency analysis” is a type of “cost-benefit analysis”.  Target readers would be familiar with these modes of project evaluation.  I suggest the authors delete Table 2 (and the accompanying discussion).  This content should be replaced with more explanation of how the Net Present Value analyses were implemented.

 

I had to arrive at p.15 of the paper, to realise that the NPV analyses were being conducted from the viewpoint of SME in Leningrad.  (i.e., the inputs into the NPV model are the flows and cost of capital experienced by these SME.)  This theme is integral and warrants more attention.  For example, what resource constraints are these SME likely to face?  Would the suggested afforestation alternatives be mutually exclusive?  The issue of which project has highest economic feasible would become less important, if an SME could afford all of them.

 

Similarly, I had to arrive at p.14 to understand that the initial outlay was modelled as the product of the cost per seedling and the number of seedlings.  This issue deserves more focus.  (I acknowledge that the authors do discuss these matters.  However, more attention is warranted, particularly in the earlier sections of the paper.)

 

Figure 6 displays the regression of an identity.  This diagram is superfluous and should be deleted.

 

The authors discount a metric of carbon efficiency.  This is meaningless.  They should estimate the annual net inflow to the SME and discount this.  I acknowledge that it would be difficult to project cash flows for the periods of the projects. 

 

The analyses use a cost of capital of 0.19 p.a., from the Bank of Russia.  More explanation would be appropriate.  I suggest using an interest rate incurred for long-term bank loans, by Russian SME.  There should be a within-text reference to the Russian central bank.

 

The discussion at the end of the paper alludes to the outcome that afforestation may not always be economically feasible, from the viewpoint of the private sector SME.  This discussion (including coverage of suggested policy implications) should be expanded.  For example, it may be appropriate to suggest government subsidisation of the SME, as a solution to rectify this problem (Boycko, Shleifer and Vishny, 1996).

 

There are numerous instances of colloquial language.  Examples include “alongside”, “worth noting”, “laying the groundwork”, “meanwhile”, “talking about”, “on the one hand” and “on the other hand”

 

Reference, cited in my report but not the paper

Boycko, M., A. Shleifer and R. Vishny, “A Theory of Privatisation”, The Economic Journal 106 (435), 309-319.  https://doi.org/10.2307/2235248

 

Comments on the Quality of English Language

My report draws attention to usage of colloquial language, which should be improved.  Otherwise, the quality of English reflects a high standard.

Author Response

Dear reviewer!

Thank you very much for your suggestions and recommendation!

Detailed replies are given below.

Sincerely yours,

Corresponding author,

Prof. Evgeny Abakumov, Saint-Petersburg State University

 

 

REVIEW OF SUBMISSION TO SUSTAINABILITY – 3464826– “COMPARATIVE ASSESSMENT OF THE ECOLOGICAL AND ECONOMIC EFFICIENCY OF THE AFFORESTATION PROJECT IN THE NORTHWEST OF RUSSIA”

 

Summary of the paper

This paper empirically investigates the economic efficiency of pursuing an afforestation project in the Leningrad region of Russia.  The authors identify relevant literature, for coverage in their literature review, from Scopus, Google Scholar and an equivalent Russian database.  They use Net Present Value analysis to model the economic viability of seven different afforestation projects, from the viewpoint of a Small to Medium Enterprise implementing the project.  The initial outlay is modelled as the product of the number of seedlings required for a project and the estimated cost per seedling.  A measure of carbon efficiency, rather than a dollar amount, is discounted.  The base-case cost of capital is 0.19 p.a., obtained from the Russian central bank.  The authors conduct sensitivity analyses.  They conclude that black alder afforestation has the highest economic efficiency.  The discussion alludes to government subsidisation, to rectify the problem that some ecologically efficient afforestation projects may lack economic efficiency.

 

Critical review

The title of the paper and the discussion therein should delete reference to sequestration potential and ecological efficiency.  This paper focuses on economic efficiency.  I suggest the authors analyse the economic efficiency of the suggested afforestation alternatives, on the assumption that they are all ecologically efficient.

Reply: We agree that issues of sequestration potential have been unaddressed. Therefore, we have changed the purpose of the paper. The aim of this study is to assess the carbon and economic efficiency of soil-vegetation combinations on a regional scale, considering the NPV sensibility assessment. Line 20-22

 

It seems unnecessary to mention the databases that were searched, to locate the studies covered in the literature review.  It would be more appropriate to focus on the content of these studies and to discuss how the authors’ paper is complementary.  Some discussion of this nature is in the paper.  It warrants more emphasis.

Reply: Thank you. We have expanded the content of the research to fill in the gaps. Line 202-236, 700-716

Table 2 outlines different modes of economic evaluation of suggested capital investment projects.  These methods are complementary and mutually reinforcing, rather than mutually exclusive.  For example, “economic efficiency analysis” is a type of “cost-benefit analysis”.  Target readers would be familiar with these modes of project evaluation.  I suggest the authors delete Table 2 (and the accompanying discussion).  This content should be replaced with more explanation of how the Net Present Value analyses were implemented.

Reply: Thank you. In investment calculations, NPV stands out as a separate method, which is why we mention it separately from Cost and benefit analysis. The description of how the net present value analysis was performed has been updated Line 310-317

 

I had to arrive at p.15 of the paper, to realise that the NPV analyses were being conducted from the viewpoint of SME in Leningrad.  (i.e., the inputs into the NPV model are the flows and cost of capital experienced by these SME.)  This theme is integral and warrants more attention.  For example, what resource constraints are these SME likely to face?  Would the suggested afforestation alternatives be mutually exclusive?  The issue of which project has highest economic feasible would become less important, if an SME could afford all of them.

Reply: The afforestation alternatives evaluated are not mutually exclusive, but their joint implementation is limited. However, when several afforestation alternatives are implemented simultaneously, data on the number of carbon units produced are not available, which makes the analysis less accurate. Resource constraints are not accounted for in the NPV model. However, we strongly agree with your comment about the need to assess the practical implementation of different afforestation options under conditions of limited financial, material or labor resources. 

Similarly, I had to arrive at p.14 to understand that the initial outlay was modelled as the product of the cost per seedling and the number of seedlings.  This issue deserves more focus.  (I acknowledge that the authors do discuss these matters.  However, more attention is warranted, particularly in the earlier sections of the paper.)

Reply: This observation is taken into account when describing the cash flow calculation. Line 327-339

Figure 6 displays the regression of an identity.  This diagram is superfluous and should be deleted.

Reply:  We would like to clarify the use of regression in the article. I regret to note that the concept of regression was used incorrectly in the article. The NPV model is fully deterministic, which precludes the use of regression. The relationship between NPV and discount rate, planting costs, carbon unit price and forest value is deterministic. Figures 3-6 show the sensitivity of NPV to the factors highlighted. The diagrams show an equation that reflects the coefficient of change in NPV for a one unit change in a factor. Based on this coefficient, we identified the most significant factors.

The authors discount a metric of carbon efficiency.  This is meaningless.  They should estimate the annual net inflow to the SME and discount this.  I acknowledge that it would be difficult to project cash flows for the periods of the projects. 

Reply:  We agree that the accounting for the cash flow from the sale of carbon units is simplistic. The actual price of a carbon unit is formed as a result of trading in the over-the-counter market and can be highly volatile. For a long-term project to take into account the trends of change with a high degree of accuracy when using NPV is difficult. 

The analyses use a cost of capital of 0.19 p.a., from the Bank of Russia.  More explanation would be appropriate.  I suggest using an interest rate incurred for long-term bank loans, by Russian SME.  There should be a within-text reference to the Russian central bank.

Reply:  Thank you. We have changed the cost of capital to the long-term loan rate for SMEs 19.9 percent. Line 318-323

The discussion at the end of the paper alludes to the outcome that afforestation may not always be economically feasible, from the viewpoint of the private sector SME.  This discussion (including coverage of suggested policy implications) should be expanded.  For example, it may be appropriate to suggest government subsidisation of the SME, as a solution to rectify this problem (Boycko, Shleifer and Vishny, 1996).

Reply: Thank you. The recommendations section has been supplemented with more specific proposals on state support for afforestation projects. Line 800-815

There are numerous instances of colloquial language.  Examples include “alongside”, “worth noting”, “laying the groundwork”, “meanwhile”, “talking about”, “on the one hand” and “on the other hand”

 

Reference, cited in my report but not the paper

Boycko, M., A. Shleifer and R. Vishny, “A Theory of Privatisation”, The Economic Journal 106 (435), 309-319.  https://doi.org/10.2307/2235248

Reply: Thank you for this advise, we have read this paper and cited.

Author Response File: Author Response.docx

Reviewer 3 Report

Comments and Suggestions for Authors

The manuscript focuses on the ecological and economic efficiency of afforestation projects in the North-West of Russia. It asses the importance of nature-based climate solution (NbCS) in carbon sequestration, biodiversity conservation, and economic feasibility. Utilizing cost-benefit analysis (CBA), net present value (NPV) modeling, and sensitivity analysis, the research aims to quantify the economic viability of afforestation. However, the manuscript presents a region-specific case study only without much comparison in a global context. While the study provides valuable contributions, several methodological and conceptual limitations exist.

Comments for author File: Comments.pdf

Author Response

Dear reviewer!

Thank you very much for your suggestions and recommendation!

Detailed replies are given below.

Sincerely yours,

Corresponding author,

Prof. Evgeny Abakumov, Saint-Petersburg State University

 

 

Comments and Suggestions for Authors The manuscript focuses on the ecological and economic efficiency of afforestation projects in the North-West of Russia. It asses the importance of nature-based climate solution (NbCS) in carbon sequestration, biodiversity conservation, and economic feasibility. Utilizing cost-benefit analysis (CBA), net present value (NPV) modeling, and sensitivity analysis, the research aims to quantify the economic viability of afforestation. However, the manuscript presents a region-specific case study only without much comparison in a global context. While the study provides valuable contributions, several methodological and conceptual limitations exist.

Major Limitations 1. The carbon credit pricing model used by the authors assume fixed values. This may not be appropriate as market volatility and policy-driven price fluctuations will influence the pricing. A stochastic or scenario-based approach to carbon credit valuation would enhance real world applications.

Reply:

Thank you for your comments. We agree that the use of a fixed price of a carbon unit limits the ability to analyze the economic efficiency of a carbon project. However, the volatility of the carbon credit market and its dependence on a variety of factors, among which can be noted conjunctural and political factors, leads to limitations of forecasting tools. The impact of the possible dynamics of carbon unit prices on the value of NPV is analyzed in the framework of sensitivity analysis. The use of the scenario method was not envisaged in this work.

2. The long-term ecological viability of afforestation is insufficiently addressed. Monoculture plantations may affect biodiversity, soil health, or water retention over extended periods. Authors can address the trade-offs between monoculture and mixed-species afforestation to add more value to the work.

Reply:

Thank you, we are agree with you recommendation, text has been amended by information required.

“In natural ecosystems, as a rule, multispecies or oligospecies plant successions develop, where different species of tree species are combined, and, as a rule, the seedlings are of different ages. As a result, mixed groupings of plants of different ages and productivity are formed, which is difficult to estimate in a mathematical or economic model. From the point of view of primary assessment of economic and ecological efficiency of revegetation of antopogenically disturbed areas, it is better to use single-species or oligospecies groups of plants – close to each other in terms of  ecology boreal plant species, as they are characterized by comparable influence on soil (formation of soil biodiversity, regulation of water regime and content of nutrition elements).  Although the introduction of woody plants from southern regions to northern regions to increase the rate and efficiency of biomass growth is widely known in the World, we do not use this model. First, because the edaphic effect would not be typical for the boreal climatic zone and would not be comparable to that of boreal taiga woody plant species. Secondly, our study is limited to strictly humid cool boreal forests in order to achieve comparability of results with each other and to comply with the principle of a single difference. ”

3. The carbon sequestration model does not account for variability in climate conditions and other environmental disasters like wildfires and extreme weather events. Including these uncertainties in the modeling framework would improve predictive accuracy.

Reply:

The objective of the study was to determine the impact of deterministic factors on the economic efficiency of the project. Taking into account natural phenomena such as forest fires and weather anomalies is possible when using the method of scenarios. However, it is clear that the occurrence of these events will reduce the environmental, carbon and economic performance of the carbon project. Increasing the resilience of the project to these risks requires additional costs for prevention and adaptation to climate change.

4. The authors discusses carbon credit registry challenges but does not provide specific recommendations anywhere in the manuscript. Why is that?

Reply:

The registry of carbon units in Russia has just begun to take shape - it is a new institutional unit. In the Russian Federation, the register of carbon units is formed by the regulator, taking into account international requirements. At the same time, the regulator is trying to solve existing problems when developing new methodologies.

1. Lines 51-57, 59-72 – Cite references Reply: Thank you. Updated
2. The Literature review section does not talk about alternative financing models. Using this angle could improve practicable applicability Reply: Thank you. Updated. Lines 195-236
3. 3. Figure 2-5 could be improved and made more informative. In the current form it is not of high quality.

Reply : Figure 2 shows the dynamics of released carbon units. This data is used to calculate the cash flow for NPV estimation.

Figures 3-5 show the change in the value of NPV from changes in the selected factors. The coefficient of change of NPV is marked on the graphs. We believe that the graphs clearly demonstrate the sensitivity of NPV.

4. Lines 498-542 – Long discussions cannot be written without citations and anchoring the presented viewpoints. Reply: Thank you. Updated
5. A section on limitations of the study needs to be added

Reply: We agree with this comment. The paper extends the limitations of the model used. Line 663-683

6. Similarly, a section on recommendation/advocacy can add more value to the manuscript.

Reply: We have added recommendations to improve the cost-effectiveness of the project. Line 800-815

Author Response File: Author Response.docx

Reviewer 4 Report

Comments and Suggestions for Authors

The paper presents a detailed analysis of the environmental and economic efficiency of an afforestation project in north-west Russia, with a focus on carbon capture and economic viability. However, there are some weaknesses in the literature, methodology, analysis of results and conclusions, as well as important issues that could be added.

About the literature and the link between literature and objectives: lack of depth in the literature review: The literature review is broad, but does not sufficiently address the existing gaps in research on nature-based afforestation projects, especially in regions with similar climatic and ecological conditions as Northwest Russia. The link between the literature reviewed and the objectives of the study could be clearer, especially with regard to the justification for the choice of tree species and economic valuation methods;
Lack of discussion of similar studies in other regions: Although the article mentions the importance of empirical studies for the implementation of nature-based solutions, it does not sufficiently discuss similar studies carried out in other parts of the world, especially in regions with similar climates. This could enrich the discussion and provide a broader context for the findings; Insufficient link between the literature and the objectives of the study: The literature review does not clearly identify how previous studies inform the specific objectives of the current study. For example, there is no detailed discussion of how economic evaluation methods for afforestation projects have been applied in other contexts and how this has influenced the choice of methods in this study.

Concerning the Methodology and Methods:The article lacks sufficient detail on the statistical methods employed, including the statistical assumptions underlying the methods used, such as the sensitivity analysis and the Net Present Value (NPV) calculation. For instance, it is not clear how the uncertainties associated with carbon capture data and planting costs were addressed.Additionally, there is an absence of robust statistical tests, such as hypothesis tests or analyses of variance, which would serve to validate the results. The absence of such statistical tests could potentially enhance the reliability of the study's findings, particularly in the context of comparing different tree species.Additionally, there is a lack of discussion regarding methodological limitations, such as the dependence on secondary data for carbon capture and planting costs, which have been observed to vary significantly depending on the source.Furthermore, there is no exploration of how future climate change might influence the study's outcomes, particularly in relation to tree growth rate and carbon capture.

In the section addressing the correlation between the analysis of results and conclusions, it is evident that the conclusions drawn do not align fully with the results obtained. The study posits that afforestation with black alder constitutes the most carbon-efficient option; however, it does not provide a comprehensive discussion of the potential negative economic ramifications of the project. Despite concluding that the project is not economically viable under current conditions, there is a paucity of discussion on how this might be mitigated, for example through government subsidies or changes to carbon pricing policies.Lack of discussion of ecological and economic trade-offs: The study does not adequately explore the trade-offs between carbon capture efficiency and economic costs. For instance, there is a paucity of discussion regarding the potential impact of selecting tree species with enhanced carbon efficiency on local biodiversity and associated ecosystem services.The conclusions drawn are of a relatively generic nature and do not offer clear guidelines for the practical implementation of afforestation projects. There are no specific recommendations concerning the structuring of funding or policies by governments or companies to enhance the viability of such projects.

Finally, the study's limitations and potential recommendations for future research are outlined. Firstly, there is an absence of practical recommendations, as the study does not provide clear guidance on the implementation of afforestation projects, particularly in relation to the selection of tree species, financing, and public policies. This restricts the practical applicability of the results. Secondly, there is a lack of discussion about the scale of the project. The study does not address how the results could be scaled up to larger areas or how they could be applied in other regions with similar climatic and ecological conditions.

The results demonstrated in Figures 4, 5, and 6 (regression lines) are dubious in nature, as a one hundred per cent coefficient of determination is atypical, and perfect correlations are unattainable. Changes to the aforementioned aspects are recommended.

Good luck

Comments on the Quality of English Language

Average

Author Response

Dear reviewer!

Thank you very much for your suggestions and recommendation!

Detailed replies are given below.

Sincerely yours,

Corresponding author,

Prof. Evgeny Abakumov, Saint-Petersburg State University

 

 

 

Reviewer#4

 

The paper presents a detailed analysis of the environmental and economic efficiency of an afforestation project in north-west Russia, with a focus on carbon capture and economic viability. However, there are some weaknesses in the literature, methodology, analysis of results and conclusions, as well as important issues that could be added.

 

About the literature and the link between literature and objectives: lack of depth in the literature review: The literature review is broad, but does not sufficiently address the existing gaps in research on nature-based afforestation projects, especially in regions with similar climatic and ecological conditions as Northwest Russia. The link between the literature reviewed and the objectives of the study could be clearer, especially with regard to the justification for the choice of tree species and economic valuation methods;

 

Reply: Thank you. Updated. Lines 9101-113, 186-236

Lack of discussion of similar studies in other regions: Although the article mentions the importance of empirical studies for the implementation of nature-based solutions, it does not sufficiently discuss similar studies carried out in other parts of the world, especially in regions with similar climates. This could enrich the discussion and provide a broader context for the findings; Insufficient link between the literature and the objectives of the study: The literature review does not clearly identify how previous studies inform the specific objectives of the current study. For example, there is no detailed discussion of how economic evaluation methods for afforestation projects have been applied in other contexts and how this has influenced the choice of methods in this study.

 

Reply: Thank you. Updated. Lines 180-190, 636-647

 

Concerning the Methodology and Methods: The article lacks sufficient detail on the statistical methods employed, including the statistical assumptions underlying the methods used, such as the sensitivity analysis and the Net Present Value (NPV) calculation. For instance, it is not clear how the uncertainties associated with carbon capture data and planting costs were addressed. Additionally, there is an absence of robust statistical tests, such as hypothesis tests or analyses of variance, which would serve to validate
the results. The absence of such statistical tests could potentially enhance the reliability of the study's findings, particularly in the context of comparing different tree species.

Reply: Thank you for the comment. We have to admit that the incorrect use of analysis terminology has led to a misunderstanding. The NPV model is a deterministic model that takes into account deterministic factors, which include the discount rate, carbon unit price, the cost of planting trees, the value of the cost of wood sold at the end of the project. Sensitivity analysis is the modeling of the change in NPV when the specified deterministic factors change. Therefore, it was incorrect to use the regression term in this method. Therefore, there is no need to include robust statistical tests in the analysis. The relationship between NPV and deterministic factors is established by the model itself. In addition, we have to admit that giving the coefficient of determination R^2 in Figures 3-6 also disoriented the reviewer. R^2 is equal to 1 because the model is fully deterministic. Nevertheless, these figures are intended to show the coefficient of change in NPV when a factor changes by one unit. The calculated NPV change coefficient allows us to say which of the listed factors have the greatest impact on the economic efficiency of the project.

Comparative analysis of carbon efficiency of the afforestation project with different tree species is carried out on the basis of the indicator Carbon Units per 1,000 RUR of Investment.

 

Additionally, there is a lack of discussion regarding methodological limitations, such as the dependence on secondary data for carbon capture and planting costs, which have been observed to vary significantly depending on the source. Furthermore, there is no exploration of how future climate change might influence the study's outcomes, particularly in relation to tree growth rate and carbon capture.

 

Reply: Methodological constraints added to the Discussion section. Line 683-706. The use of secondary data is justified by the lack of a direct monitoring system for carbon sequestration. Primary data on the cost of planting trees depends not only on the market price of seedlings, but also on the availability of labor cost data. Such information is limited.

 

In the section addressing the correlation between the analysis of results and conclusions, it is evident that the conclusions drawn do not align fully with the results obtained. The study posits that afforestation with black alder constitutes the most carbon-efficient option; however, it does not provide a comprehensive discussion of the potential negative economic ramifications of the project. Despite concluding that the project is not economically viable under current conditions, there is a paucity of discussion on how this might be mitigated, for example through government subsidies or changes to carbon pricing policies. Lack of discussion of ecological and economic trade-offs: The study does not adequately explore the trade-offs between carbon capture efficiency and economic costs. For instance, there is a paucity of discussion regarding the potential impact of selecting tree species with enhanced carbon efficiency on local biodiversity and associated ecosystem services. The conclusions drawn are of a relatively generic nature and do not offer clear guidelines for the practical implementation of afforestation projects. There are no specific recommendations concerning the structuring of funding or policies by governments or companies to enhance the viability of such projects.

 

 

Reply: Alternative afforestation options with different tree species are evaluated in order to select the option that yields the highest carbon sequestration per unit of investment value. Since the main objective of carbon projects is carbon sequestration, we defined carbon efficiency as the criterion for selecting tree species. We agree that comparing the carbon effect to the economic effect could provide greater validity to the selection of tree species. Since the economic efficiency of the project is negative in our analysis, the first priority is to develop directions for improving efficiency. For the further direction of the study we can define the task of simultaneous consideration of economic, carbon and other effects in the comparative evaluation of alternative afforestation options with different tree species.

Specific recommendations for improving project viability are added to the text of the article based on the NPV change factor. Line 800-815

 

Finally, the study's limitations and potential recommendations for future research are outlined. Firstly, there is an absence of practical recommendations, as the study does not provide clear guidance on the implementation of afforestation projects, particularly in relation to the selection of tree species, financing, and public policies. This restricts the practical applicability of the results. Secondly, there is a lack of discussion about the scale of the project. The study does not address how the results could be scaled up to larger areas or how they could be applied in other regions with similar climatic and ecological conditions.

 

Reply: Natural and climatic features of the project location region influence the volume and dynamics of carbon sequestration by different tree species. Other factors of carbon and economic efficiency in the model are deterministic and do not depend on the choice of afforestation region. Therefore, carbon and economic efficiency will not change in regions with similar natural and climatic conditions. However, we agree that other regions with similar climatic and ecological conditions may have different socio-economic conditions (e.g., cost of seedlings, planting costs and transportation costs), which will lead to differences in carbon and economic efficiency. This will lead to differences in carbon and economic efficiency. Such calculations should be made in relation to specific alternative afforestation sites.

 

The results demonstrated in Figures 4, 5, and 6 (regression lines) are dubious in nature, as a one hundred per cent coefficient of determination is atypical, and perfect correlations are unattainable. Changes to the aforementioned aspects are recommended.

Reply: The NPV model is fully deterministic, so the influence of the factors described above is deterministic. We agree that the use of the term regression in the article was incorrect.

Author Response File: Author Response.docx

Round 2

Reviewer 2 Report

Comments and Suggestions for Authors

REVIEW OF SUBMISSION TO SUSTAINABILITY – 3464826R1– “COMPARATIVE ASSESSMENT OF THE ECOLOGICAL AND ECONOMIC EFFICIENCY OF THE AFFORESTATION PROJECT IN THE NORTHWEST OF RUSSIA”

 

Preliminary note

I have not reproduced my summary of this paper.  The manuscript has not changed sufficiently, from the previous version, to warrant this.

 

Critical review

 

Purpose

1. Are the terms ‘’sequestration potential” and “carbon efficiency” interchangeable? It may be appropriate to clarify in the introduction.

 

Literature review

2. On p.6, the authors outline funding alternatives that governments could use to promote carbon and economic efficiency. This entire section belongs in the discussion of government policy implications of the findings, in the discussion section (towards the end of the paper), rather than the literature review.

 

3. The discussion about Payment for Ecosystems Services relates to a government policy to promote corporate environmental responsibility, rather than a source of government funding. While this coverage belongs in the discussion section, is should not be part of the content about modes of government funding.

 

4. The discussion of supply chain finance is unclear. The authors should clarify that this is a mode of funding from the product market (rather than the capital market), from a different level of the supply chain.

 

Methodology

5. It seems that the cost-benefit analysis was an initial screening mechanism, to remove infeasible afforestation alternatives. The next step was to use Net Present Value analysis to select the optimal alternative and conduct sensitivity analysis.  Is this correct?  Clarification would be appropriate.

 

Data sources

6. It appears that Estonia was chosen as a benchmark, due having similar soil to the Leningrad region. Is this correct? 

 

7. The approach to estimating the cost of seedlings, for observations with missing data is important. Insufficient details are provided.  It would be suitable to illustrate in an appendix or a footnote.

 

Discussion

8. Delete the discussion of large, listed companies. A strength of this paper is its focus on Small and Medium Enterprises.

 

Presentation

9. Usage of colloquial language abounds, such as “among others”.  This phrase should be deleted.  Other examples include “meanwhile” (instead of “however”), “alongside” (rather than “in conjunction with”) “business-as-usual” (instead of “the ordinary course of business”), “scaling up” (instead of “escalating”), “as a rule” (instead of “in general”), “as well as” (rather than “in addition to”, “for instance” (rather than “for example”), “first of all” (rather than “firstly”), “talking about” (rather than “referring to”) and “on the other hand” (rather than “conversely”).  The expression “on the one hand” should be deleted.

 

10. The term “sensibility analysis" is used on p.7. Surely this is a typo and the authors meant “sensibility analysis”?

 

11. The shorthand “vs” should be written in full.

 

12. Point form is unsuitable for a paper.

 

13. The word “World” on p.9 should be in lower case.

 

 

 

Author Response

Dear reviewer!

thank you for all comments and suggestions!

we have corrected the article according to your comments

 

Reviewer #2

Comment 1 Are the terms ‘’sequestration potential” and “carbon efficiency” interchangeable? It may be appropriate to clarify in the introduction.

Response 1. Explained in the introduction the difference between sequestration potential and carbon efficiency of a project. Line 65-78

 

Comment 2 On p.6, the authors outline funding alternatives that governments could use to promote carbon and economic efficiency. This entire section belongs in the discussion of government policy implications of the findings, in the discussion section (towards the end of the paper), rather than the literature review.

Response 2. Thanks for the recommendation. Done. The text has been moved to the discussion, 718-746

 

Comment 3. The discussion about Payment for Ecosystems Services relates to a government policy to promote corporate environmental responsibility, rather than a source of government funding. While this coverage belongs in the discussion section, is should not be part of the content about modes of government funding.

Response 3. PES removed from funding sources, moved to discussions, Line 780-786

 

Comment 4. The discussion of supply chain finance is unclear. The authors should clarify that this is a mode of funding from the product market (rather than the capital market), from a different level of the supply chain.

Response 4. The concept is clarified, Line 739-746

Methodology

 

Comment 5. It seems that the cost-benefit analysis was an initial screening mechanism, to remove infeasible afforestation alternatives. The next step was to use Net Present Value analysis to select the optimal alternative and conduct sensitivity analysis.  Is this correct?  Clarification would be appropriate.

Response 5. The role of cost-benefit analysis in the tree species selection procedure has been explained in Line 380-394

 

Data sources

Comment 6: It appears that Estonia was chosen as a benchmark, due having similar soil to the Leningrad region. Is this correct? 

Response 6: Yes, the using of Estonia as a benchmark is correct, because of the similar nature conditions, as shown in lines 374-379

 

Comment 7. The approach to estimating the cost of seedlings, for observations with missing data is important. Insufficient details are provided.  It would be suitable to illustrate in an appendix or a footnote.

Response 7. Estimates of seedling costs, including planting and transportation costs, have been refined in Line 496-400 and in Annex 1.

 

Discussion

Comment 8. Delete the discussion of large, listed companies. A strength of this paper is its focus on Small and Medium Enterprises.

Response 8. Discussion of large public companies was removed and update, Line 805-810

 

Presentation

Comment 9. Usage of colloquial language abounds, such as “among others”.  This phrase should be deleted.  Other examples include “meanwhile” (instead of “however”), “alongside” (rather than “in conjunction with”) “business-as-usual” (instead of “the ordinary course of business”), “scaling up” (instead of “escalating”), “as a rule” (instead of “in general”), “as well as” (rather than “in addition to”, “for instance” (rather than “for example”), “first of all” (rather than “firstly”), “talking about” (rather than “referring to”) and “on the other hand” (rather than “conversely”).  The expression “on the one hand” should be deleted.

Response 9. Thanks for the recommendation. The manuscript will be submitted for paid editing to the journal

 

Comment 10. The term “sensibility analysis" is used on p.7. Surely this is a typo and the authors meant “sensibility analysis”?

Response 10. Thanks, we meant sensitivity analysis. Corrected in text.

 

Comment 11. The shorthand “vs” should be written in full.

Response 11. Done.

 

Comment 12. Point form is unsuitable for a paper.

Response 12. Thanks for the recommendation. The manuscript will be submitted for paid editing to the journal

 

Comment 13. The word “World” on p.9 should be in lower case.

Response 13. Done.

Reviewer 3 Report

Comments and Suggestions for Authors

1. This comment was not addressed - "Figure 2-5 could be improved and made more informative. In the current form it is not of high quality".

Author Response

Comment 1. This comment was not addressed - "Figure 2-5 could be improved and made more informative. In the current form it is not of high quality"

Response 1: Graphical representation of the results of the sensitivity analysis in the form of a diagram allows to show how the NPV value changes when the variables change [A V Anas et al 2020 IOP Conf. Ser.: Mater. Sci. Eng. 875 012050]. Furthermore, it is important to note that graphical representations facilitate the estimation of the variable NPV's value at which it will be zero, that is to say, they allow for the determination of the limits of economic efficiency of the project when the variable undergoes change. The standardized regression coefficient calculated for NPV dependence on variables measures the sensitivity of the result from one unit change in a variable. Line 506-524

Thank you,

with kindest regards,

authors.

Reviewer 4 Report

Comments and Suggestions for Authors

Congratulations to the authors for improving their work.

Comments on the Quality of English Language

Good.

Author Response

Tnank you for you comment!

Round 3

Reviewer 2 Report

Comments and Suggestions for Authors

Preliminary note

I have not reproduced my summary of this paper.  The manuscript has not changed sufficiently, from the previous version, to warrant this.

 

Critical review

My only remaining criticisms are minor and editorial.  Instead of expressing these criticisms, I will leave this to the domain of the professional proof-editor.

Author Response

Dear reviewer!

thank you for you comments, paper was changed in terms of spelling and grammar, 

some inaccuracies have been eliminated, thank you for your work,

sincerely yours,

authors

Author Response File: Author Response.pdf