Japan has a huge potential for economic gains by utilizing its forests that are currently maintained by a dwindling, aging workforce. Jobs in the forest sector aren’t very attractive to younger workers due to the low salary, but there is a lot of potential for forestry to become an integral part of the Japanese economy (Sasaki 2011). If leftover biomass from routine forest thinning could be used for biofuel production it would increase available jobs and promote forest tourism, stimulating the economy.
According to Etoh et al, since Japan isn’t utilizing the thinned forest material, it actually acts as a source of carbon leakage, causing Japan to lose “$268 million if carbon is priced at $ 20 MgCO2. The $268 million is equivalent to $487.54 ha-1 (about 40.466 yen) to be paid for any thinned forest in order to prevent thinning-driven leakages. This amount could be used as subsidies for promoting bioelectricity production in Japan.”
However, it is costly to produce cellulosic biofuels. Without proper research into more effective methods of production, it may not be economically feasible to produce these fuels. It will also take a lot of tax cuts and subsidies to kickstart the use of biofuels, as with any renewable energy. Other countries have made the jump though, specifically in Europe, and the subsidies have paid off in terms of reduced carbon emissions, at least.