Helping Washington DNR Leverage Ecosystem Markets for Climate and Revenue Goals

Avoided Wildfire Emissions could fund forest health and resiliency while reducing fuel treatment work. 

Greene Economics’ evaluation for Washington DNR prioritizes forest carbon, wildfire prevention, and water markets by revenue potential and policy readiness, providing a strategic framework to guide sustainable land stewardship and climate action.

Greene Economics recently completed a major evaluation for the Washington State Department of Natural Resources (DNR), delivering a strategic roadmap to align land stewardship with emerging ecosystem service markets and state climate goals.  Authorized by the 2023 Washington State Operating Budget and funded by the Climate Commitment Act, , the project identified viable opportunities for DNR to generate revenue while advancing climate goals and maintaining ecosystem health.

Greene Economics led the team that created a comprehensive resource and asset inventory, developed a marginal abatement cost curve (MACC)—a tool ranking carbon strategies by cost and impact—and analyzed the feasibility of DNR’s participation in emerging ecosystem service markets. Key partners included researchers from CTEH/Montrose and Spatial Informatics Group (SIG). 

Currently, DNR generates revenue through timber sales and leases for agriculture, grazing, and aquaculture. This evaluation explored new ecosystem service markets with revenue potential tied to carbon sequestration, habitat and biodiversity, water leasing, and emerging avoided wildfire emissions markets.  

Based on revenue potential and policy conditions, the most promising market opportunities included: 

• Forest carbon offset projects: Potential for improved forest management.
  

• Avoided wildfire emissions (AWE) market: Could fund forest health and reduce fuel treatment work.
  

• Water quantity market: Shows strong economic potential in water leasing, pending water rights research.

  
  

Markets such as blue carbon and biodiversity face cost, policy, or maturity hurdles today but may offer future promise as conditions evolve.  

“Developing ecosystem service credit projects is highly site- and market-specific. The challenge for DNR, and for any state managing lands held in trust, is balancing the need to generate revenue for trust beneficiaries while also protecting and enhancing other environmental and social benefits,” said Bea Covington, a principal economist at Greene Economics.  

“Our team developed a market alignment framework to help DNR assess when and where ecosystem service market projects make economic and policy sense. It’s a tool they can use now—and adapt as markets evolve.”  

An external advisory group—including Tribes, trust beneficiaries, agency staff, and market experts— provided critical input and regularly reviewed findings, ensuring the evaluation’s relevance and rigor.

DNR will submit the final legislative report this summer. Read the complete Ecosystem Service Inventory and Asset Plan here. To explore additional findings or view meeting recordings, visit the DNR Ecosystem Services Work Group page.

At Greene Economics, we’re proud to support thoughtful, strategic policymaking that makes economic sense and helps Washington meet its climate goals—while delivering lasting benefits to communities, ecosystems, and future generations.