RISK MANAGEMENT Application to Fire and Forest Management
OUTLINE 1. Risk management concepts and principles 2. Planning under uncertainty - implications for forest management 3. Fire and timber supply game (group exercise)
Risk Management Principles and Concepts
Risk - Seeking a Definition It’s not as easy as it seems “In 1981 the Society for Risk Analysis established a committee to define risk. After 3-4 years of work, the committee published a list of about 14 candidate definitions and reported that it could not reach agreement. They recommended that a single definition of risk not be established, but that everyone be free to define it as appropriate to his own work.” Kaplan (1991)
Risk vs. Uncertainty • Uncertainty - the condition of not knowing. • (no qualification if the outcome of an event or process is good or bad). • Example: Flipping a coin - will it be heads or tails? • Will there be a fire at point X? Risk - exposure to a chance of loss • articulate and quantify • likelihood • exposure • loss • Example: There is a • 5% chanceof a fire burning • mgt unit X in the next 25 yrs, causing10% reduction in AAC.
Other Definitions HAZARD - An assessment of fire behaviour potential based solely on the physical fuel characteristics (without regard for the weather conditions, ignition sources, topography, etc.)
Other Definitions FIRE OCCURRENCE RISK - The probability or chance of a fire starting. Depends on: lightning occurrence human activity weather/fuel moisture
Risk = damage x uncertainty (loss) Risk - Defined Examples: 1. You are given a lottery ticket and could win either 100 million or 101 million dollars - is there any risk? 2. You hit a valuable vase with a sledge hammer - is there any risk?
Risk - Defined Risk = damage x uncertainty Global vs individual Risk Global risk - 5000 people are injured or die in car accidents each year (very little uncertainty about this number so there is no risk to society?) Individual risk - Uncertain of who will be among the 5000 people therefore there is risk to the individual.
Risk from Wildfire Spatial aspects of risk from wildfire Assume that somewhere in AB there will be a 200,000 ha fire in the next 10 years. If there is only one forest company in AB is there any risk? If there are many forest companies in AB (with operating areas of about 300,000 ha) is there any risk?
Risk from Fire Temporal aspects of risk from fire A stand has a 1% chance of burning each year ( P = 0.01) so what is the probability that it will survive 1 year? S = 1 - .01 = 0.99 (or 99%) What is the probability of that stand surviving ‘n’ years. S = .99 x .99 x .99 x .99 … n S = (1-P)n The probability that it will survive for 40 years? S = (1-P)n -> S = (1-.01)40 -> S = 0.67 (or 67%)
Probability of a Stand Surviving over Time Annual chance of burning .1% .5% 1% • Might explain why older forests seems to burn more often • Must consider not only how much wood there will be at time X but also the chance of it being there 2% 5%
Forest Management Decision-making under Uncertainty
Exercise List some Uncertainties relating to a Future Forest
0 10 20…. 60+ 50 40 Age Class (years) 30 20 10 Area (ha) in each age class Simplified Forest Time (years) growing harvest burned
What are main implications of ignoring uncertainties such as fire in forest planning? • Over-estimation of total volume available • Incorrect assessment of the age class distribution • Inappropriate (or no) estimate of potential variability of volume available over time (i.e., wood flow)
THE FIRE AND TIMBER SUPPLY GAME “IS THAT YOUR FINAL ANSWER”
Compartment No. 1 2 3 10 20 30 Harvest oldest first Age Class 4 5 6 6 40 50 60 60 FIRE AND TIMBER SUPPLY GAME Logging 0-10 years Volume = 1,000,000 cu.m. Mean Age = 210/6 = 35
Compartment No. 1 2 3 20 30 40 Age Class 4 5 6 50 60 10 FIRE AND TIMBER SUPPLY GAME Logging - NEXT TIME PERIOD 10-20 years Grow each compartment by 10 years
Compartment No. 1 2 3 10 20 30 Age Class 40 4 Harvest oldest first 4 5 6 6 40 50 60 60 Burn FIRE AND TIMBER SUPPLY GAME Logging and Fire 0-10 years Volume = 1000 Mean Age = 210/6 = 35
1 2 3 20 30 40 4 5 6 10 60 10 FIRE AND TIMBER SUPPLY GAME Logging and Fire - Next Time Period 10-20 years Grow each compartment by 10 years
A Few Key Facts 1. We are living and working in a flammable forest. 2. Wildfires (and many other factors) create uncertainty about future returns from the forest, therefore forest management is a form of risk management. 3. Timber supply modelling must consider not only how much wood volume will be available but also if (or the likelihood) of it being available. 4. Forest level analysis is required to fully understand the impact of wildfires.