Alex Dubgaard

Scenario realism and welfare estimates in choice experiments – A non-market valuation study on the European water framework directive

Using choice experiment data for economic valuation we analyse how disbelief in survey information could affect the retrieved welfare estimates. We distinguish between two types of survey information to the respondents. The first type of information concerns the current environmental status of a water body. This information is provided prior to the valuation questions and the corresponding beliefs in the provided information are also elicited before valuation. The second type of information concerns the proposed improvements in the environmental status of the water body. We find that average welfare measures differ considerably according to whether respondents who disagree with the status quo levels and find proposed scenarios unlikely are included or not.

A practical CBA-based screening procedure for identification of river basins where the costs of fulfilling the WFD requirements may be disproportionate – applied to the case of Denmark

The European Unions (EU) Water Framework Directive (WFD) is implemented as an instrument to obtain good ecological status in waterbodies of Europe. The directive recognises the need to accommodate social and economic considerations to obtain cost-effective implementation of the directive. In particular, EU member states can apply for various exemptions from the objectives if costs are considered disproportionate, e.g. compared to potential benefits. This paper addresses the costs and benefits of achieving good ecological status and demonstrates a methodology designed to investigate disproportionate costs at the national level. Specifically, we propose to use a screening procedure based on a relatively conservative cost–benefit analysis (CBA) as a first step towards identifying areas where costs could be disproportionate. We provide an empirical example by applying the proposed screening procedure to a total of 23 river basin areas in Denmark where costs and benefits are estimated for each of the areas. The results suggest that costs could be disproportionate in several Danish river basins. The sensitivity analysis further helps to pinpoint two or three basins where we suggest that much more detailed and elaborate CBAs should be targeted in order to properly ascertain whether costs are indeed disproportionate.

Three perspectives on motivation and multicriteria assessment of organic food systems

Organic food systems are based on a complex of value criteria that often are not explicitly considered when agents think, communicate, and make decisions concerning organic food. Multicriteria assessment (MCA) refers to a group of tools that help the user to tackle such highly complex issues. The question is how an MCA tool should be designed to facilitate reflections, communication, and decision making in relation to organic food systems. A key issue is motivation. There are several divergent theories of motivation, and the question cannot be adequately answered by using any single theory. We discuss an economic, a psychosocial, and a relational perspective on motivation and MCA. Using the example of a consumer assessing and choosing products in the supermarket, the economic conception of motivation offers a focus on decision-making processes. The psychosocial approach to motivation draws attention to the influence of cognitive structures and experience-based emotional drivers. Finally, the relational approach stresses that motivation is situated in the relations between agents. We discuss how the three perspectives converge and diverge regarding the purpose of using an MCA tool, the scope of the MCA, the strategic focus, and challenges and potentials associated with an MCA tool. Through this multiple-perspective approach, the general idea of MCA is expanded and elaborated to refine the design of an MCA tool for organic food systems.

Taxation as an instrument to reach the EU 2020 target within agriculture

The EU target requires a reduction of CO2 emissions by 20% before 2020 and that will be a difficult task for Danish Agriculture. The main measures for achieving this are likely to be more wetlands, increased use of biogas and change in the feeding of dairy cows. The instruments used could include a levy on the emissions at the farm level in order to obtain the most cost-efficient reduction. Introduction In January 2008 the EU commission presented a Climate Package which intends to reduce CO2 emissions from the non quota areas by at least 20% in by 2020 compared to 2005. Denmark The total emissions in Denmark are 68 million tonne CO2 equivalents. The reduction target under the Kyoto protocol is 21% from 1990 to 2010, but the likely reduction is only 4%. Today 44% of the emissions are regu Please don’t tax me it wasn’t me! TAX on CO2 emissions from the farm A tax per cow (a burp and farting tax ) is not a very cost-efficient instrument as this will not provide incentives to a cost efficient adaptation. It is more efficient to impose a tax on the emissions at the farm level allowing individual adaptations. The calculation of emissions could be based on standard emissions per cow based on the farm system and the feeding practice used. The tax should not be higher than the benchmark. The benchmark price used in Denmark is 30 € per tonne CO for the 2013 2020 period lated through the EU quota system. Transport and Agriculture are the largest sectors outside the quota system with 21% and 17% of the total emissions. Can it be done? The possible measures are : Energy related measures Area related measures Livestock related measures Energy Area related measures The creation of wetlands will have a potential of 0.3 million tonne CO2. Also, the fulfilment of the EU Water Framework Directive might require 50.000 ha (2%) taken out of production. The area could then serve a dual purpose. A tax per cow is not cost-efficient Energy 41% Business 14% Households 5% Waste 2% CO2 emissions in Denmark in 2010 2 . 0,0 1,0 2,0 3,0 4,0 5,0 Cows now Cows future Cows future Pigs now Pigs future To nn e C O 2 / L iv es to ck U ni t CO2 emissions per Livestock Unit Agriculture Agriculture is the main emitter of nitrous gasses and methane. Most of the emissions are related to animals. The emissions of CO2 through direct energy use is limited (10%). The total emission in 2010 is expected to be 10 million tonne CO2 equivalents. Agriculture contributes through biomass, 3% of the total Danish energy use. The share could be closer to 10% if products like straw and slurry were utilised more. Production of biogas reduces the emissions of methane from manure storage and the energy produced replaces fossil fuels. At present , 4% of the animal manure is used in Biogas plants. Utilising the economic potential would reduce emissions by 0.8 million tonne CO2. Removing carbon dioxide from the atmosphere is known as carbon sequestration. It is included in the Kyoto calculations, but not yet in the EU target principle. Without this effect , many of the area related measures will not be as costeffective. Livestock measures Increasing the use of fat in the feed ration to dairy cows will reduce the emissions of methane by 15%. The reduction could be 0.3 million tonne CO2. Combined with Transport 21% Agriculture 17% Future A cost effective implementation implies that the cheapest measures are implemented. It is not clear where the cheapest measures are in the non-quota sectors. The results will direct the reduction required in Agriculture. Much is gained from implementing measures which have a dual purpose as is (fat) (fat+biogas) (biogas) The EU proposal requires a 13 million tonne CO2 reduction in Denmark.. If Agriculture has to reduce the same share as other non-quota sectors, like housing and transport, they have to reduce emissions by 3 million tonne CO2. An alternative is to grow energy crops like willow which can be used in combined power and heating plants. This is especially relevant on marginal land. The economic potential for this is 1.2 million tonne CO2. biogas this will reduce the emissions considerably. Also reduced tillage or zero tillage is a way forward and the costs are low, as shown below. CO2 emissions from Danish Agriculture are expected to decrease by 25% from 1990 to 2010. A large effort is required if Danish Agriculture are to reduce CO2 emissions by 3 million tonne by 2020. Type of Green House Gas emissions in D i h A i lt i 2010 the case with the creation of wetlands. References Dubgaard, Alex, Kurt Hjort-Gregersen, Carsten J. Nissen, Hanne L. Jespersen og Morten Gylling (2008). Cost of measures to reduce Greenhouse Gas Emissions from Danish Agriculture, Agriculture and Climate – Part II, pp. 61-146. Ministry of Agriculture, December 2008 (in Danish) 20 40 60 Cost of reducing CO2 emissions in Danish Agriculture Without C sequestration With C sequestration Carbon dioxide (CO2) 17% Methan (NH4) 30% Nitrous Oxide (N2O) 53% an s gr cu ure n . IPCC (2007). Climate Change Impacts, Adaptation and Vulnerability. Working Group II and III. Olesen, Jørgen E. (2008): Measures to reduce Greenhouse Gas Emissions from Danish Agriculture, Agriculture and Climate Part I , pp. 31-59. Ministry of Agriculture, December 2008. (in Danish)