Investment analyses of fuelwood plantations in Sri Lanka

This report presents financial, economic, and biological analyses of this practice and develops a procedure for determining the feasibility of establishing fuelwood plantations to grow Eucalyptus camaldulensis. The financial analysis focuses on the returns to an inventor based on actual costs and revenues and also includes a base case scenario of investment assumptions and a sensitivity analysis of these assumptions. Soil Expectation Value (representing the value of an infinite series of plantings on a given plot) is also determined. The economic analysis assesses the returns to society of E. camaldulensis plantations. Both the financial and economic analyses use maximization of net present value (NPV) as the criterion for determining efficient resource allocation and incorporate real internal rates of return. The biological analysis uses site index (which relates the height of the tallest tree in a plantation to the age of the plantation) as the quantitative measure for ranking plantation productivity. The authors produce site index curves and yield curves as well as yield estimates for E. camaldulensis. Regarding plantation management regimes, tree spacing and methods of tree maintenance are considered. Based on detailed, quantitative conclusions, the authors conclude the Sri Lankan planners must determine the amount of plantation land required to meet the nation"s fuelwood demand. A method of using the analyses in this report to make this determination, which entails considering the alternative energy sources and land uses, is outlined. Appended are a 25-item bibliography (1967-80); yield tables for E. camaldulensis; estimation equations; graphical presentation of sensitivity analyses; and a glossary.