Brian H. Jacobsen

Evaluating nitrogen taxation scenarios using the dynamic whole farm simulation model FASSET

The whole farm model FASSET ver. 1.0 was used for evaluation of the environmental and economic consequences of implementing different nitrogen taxes. The taxation policies analysed were a tax on nitrogen in mineral fertiliser, a tax on nitrogen in mineral fertiliser and imported animal feedstuff, and a tax on the farm nitrogen surplus. In these scenarios, the tax price was equal to the price of the nitrogen in mineral fertilisers (0.67 E kg N 1 ). Four farm types were considered: arable on sandy soil, arable on loamy soil, pig production on sandy soil and pig production on loamy soil. Impacts of the taxes for each farm type on crop rotation, fertiliser use and pig production were estimated by the Linear Programming module of FASSET. The dynamic simulation module of FASSET evaluated the environmental and economic consequences of the new production plans. The social abatement cost of reducing nitrate leaching varied between 1 and 9 E kg N 1 . None of the taxation policies was the most cost-effective for all farm types. Tax on mineral fertiliser favours pig producers, whereas the tax on nitrogen surplus favours arable farms. Thus efficient taxation schemes for reduction of nitrate leaching should differentiate between farm types rather than use uniform input taxes. # 2003 Elsevier Science Ltd. All rights reserved.

Costs and benefits of nitrogen for Europe and implications for mitigation.

Cost-benefit analysis can be used to provide guidance for emerging policy priorities in reducing nitrogen (N) pollution. This paper provides a critical and comprehensive assessment of costs and benefits of the various flows of N on human health, ecosystems and climate stability in order to identify major options for mitigation. The social cost of impacts of N in the EU27 in 2008 was estimated between €75-485 billion per year. A cost share of around 60% is related to emissions to air. The share of total impacts on human health is about 45% and may reflect the higher willingness to pay for human health than for ecosystems or climate stability. Air pollution by nitrogen also generates social benefits for climate by present cooling effects of N containing aerosol and C-sequestration driven by N deposition, amounting to an estimated net benefit of about €5 billion/yr. The economic benefit of N in primary agricultural production ranges between €20-80 billion/yr and is lower than the annual cost of pollution by agricultural N which is in the range of €35-230 billion/yr. Internalizing these environmental costs would lower the optimum annual N-fertilization rate in Northwestern Europe by about 50 kg/ha. Acknowledging the large uncertainties and conceptual issues of our cost-benefit estimates, the results support the priority for further reduction of NH3 and NOx emissions from transport and agriculture beyond commitments recently agreed in revision of the Gothenburg Protocol.

Policies for agricultural nitrogen management—trends, challenges and prospects for improved efficiency in Denmark

With more than 60% of the land farmed, with vulnerable freshwater and marine environments, and with one of the most intensive, export-oriented livestock sectors in the world, the nitrogen (N) pollution pressure from Danish agriculture is severe. Consequently, a series of policy action plans have been implemented since the mid 1980s with significant effects on the surplus, efficiency and environmental loadings of N. This paper reviews the policies and actions taken and their ability to mitigate effects of reactive N (Nr) while maintaining agricultural production. In summary, the average N-surplus has been reduced from approximately 170 kg N ha?1 yr?1 to below 100 kg N ha?1 yr?1 during the past 30 yrs, while the overall N-efficiency for the agricultural sector (crop?+?livestock farming) has increased from around 20?30% to 40?45%, the N-leaching from the field root zone has been halved, and N losses to the aquatic and atmospheric environment have been significantly reduced. This has been achieved through a combination of approaches and measures (ranging from command and control legislation, over market-based regulation and governmental expenditure to information and voluntary action), with specific measures addressing the whole N cascade, in order to improve the quality of ground- and surface waters, and to reduce the deposition to terrestrial natural ecosystems. However, there is still a major challenge in complying with the EU Water Framework and Habitats Directives, calling for new approaches, measures and technologies to mitigate agricultural N losses and control N flows.

Nitrate reduction in geologically heterogeneous catchments--a framework for assessing the scale of predictive capability of hydrological models.

In order to fulfil the requirements of the EU Water Framework Directive nitrate load from agricultural areas to surface water in Denmark needs to be reduced by about 40%. The regulations imposed until now have been uniform, i.e. the same restrictions for all areas independent of the subsurface conditions. Studies have shown that on a national basis about 2/3 of the nitrate leaching from the root zone is reduced naturally, through denitrification, in the subsurface before reaching the streams. Therefore, it is more cost-effective to identify robust areas, where nitrate leaching through the root zone is reduced in the saturated zone before reaching the streams, and vulnerable areas, where no subsurface reduction takes place, and then only impose regulations/restrictions on the vulnerable areas. Distributed hydrological models can make predictions at grid scale, i.e. at much smaller scale than the entire catchment. However, as distributed models often do not include local scale hydrogeological heterogeneities, they are typically not able to make accurate predictions at scales smaller than they are calibrated. We present a framework for assessing nitrate reduction in the subsurface and for assessing at which spatial scales modelling tools have predictive capabilities. A new instrument has been developed for airborne geophysical measurements, Mini-SkyTEM, dedicated to identifying geological structures and heterogeneities with horizontal and lateral resolutions of 30-50 m and 2m, respectively, in the upper 30 m. The geological heterogeneity and uncertainty are further analysed by use of the geostatistical software TProGS by generating stochastic geological realisations that are soft conditioned against the geophysical data. Finally, the flow paths within the catchment are simulated by use of the MIKE SHE hydrological modelling system for each of the geological models generated by TProGS and the prediction uncertainty is characterised by the variance between the predictions of the different models.

The European Nitrogen Assessment: Costs and benefits of nitrogen in the environment

Single issue policies have been an effective means of reducing reactive nitrogen (N_r) emissions in the EU, but to make further reductions more-integrated approaches are required.

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.

Economic gains from targeted measures related to non-point pollution in agriculture based on detailed nitrate reduction maps

From 1990 to 2003, Denmark reduced N-leaching from the root zone by 50%. However, more measures are required, and in recent years, the focus has been on how to differentiate measures in order to ensure that they are implemented where the effect on N-loss reductions per ha is the greatest. The purpose of the NiCA project has been to estimate the natural nitrate reduction in the groundwater more precisely than before using a plot size down to 1ha. This article builds on these findings and presents the possible economic gains for the farmer when using this information to reach a given N-loss level. Targeted measures are especially relevant where the subsurface N-reduction varies significantly within the same farm and national analyses have shown that a cost reduction of around 20-25% using targeted measures is likely. The analyses show an increasing potential with increasing variation in N-reduction in the catchment. In this analysis, the knowledge of spatial variation in N-reduction potential is used to place measures like catch crops or set-a-side at locations with the greatest effect on 10 case farms in the Norsminde Catchment, Denmark. The findings suggest that the gains are from 0 to 32€/ha and the average farm would gain approximately 14-21€/ha/year from the targeted measures approach. The analysis indicates that the economic gain is greater than the costs of providing the detailed maps of 5-10€/ha/year. When N-loss reduction requirements are increased, the economic gains are greater. When combined with new measures like mini-wetlands and early sowing the economic advantage is increased further. The paper also shows that not all farms can use the detailed information on N-reduction and there is not a clear link between spatial variation in N-reduction at the farm level and possible economic gains for all these 10 farms.

Combining active farmer involvement with detailed farm data in Denmark: a promising method for achieving water framework directive targets?

The Water Framework Directive (WFD) encourages active involvement during its implementation, although no specific participatory methods are suggested, whilst implementing the target-oriented Directive will require detailed agri-environmental data at catchment and farm level. The paper is a case study of the Danish AGWAplan project, which actively involved farmers in the selection of measures to reduce diffuse nutrient pollution at farm and catchment level, thereby providing an example of how active involvement might be operationalised. Active involvement has been identified as being of central importance to the success of the WFD. The project also entailed the accumulation of extensive agri-environmental data. The aim of the paper is to evaluate AGWAplan to establish the extent to which its expected objectives have been achieved and how, and to determine whether the project approach might facilitate WFD goals if implemented in forthcoming river basin management plans (RBMPs). AGWAplan resulted in advantageous outcomes, including win-win solutions to reduce nutrient leaching and greater acceptance of policy, although the original reduction targets where not fully reached. The paper concludes that actively involving farmers in a similar manner in RBMPs may make an important contribution to the implementation of the WFD, although caveats regarding its potential for transfer to other areas are identified.

Farm economic and environmental effects of reduced tillage.

Abstract Reduced tillage is an increasingly popular farming method. In some countries it is used on up to 50% of the total cropland, but in Denmark the area with reduced tillage is only 10%. The benefit from reduced tillage is a higher marginal profit per ha due to an increased productivity of labour and machinery, but there are also environmental benefits e.g. reduced phosphorus and nitrogen losses as well as reduced Greenhouse Gas emissions. In a recent Danish research project, the economic and environmental effects of reduced tillage have been analysed by using a farm economic crop production model, simulating arable farmers’ rational adjustment to new technologies, prices and regulations. The conclusion is that reduced tillage increases the profits by € 67–111 per ha according to farm size and it reduces the use of fuel per ha. With no changes in the crop rotation, the nitrogen surplus is unaffected and pesticide use is increased. However, the optimal adaptation to reduced-tillage systems includes a change in the crop rotation increasing the share of spring cereals. As a result of this adjustment, the nitrogen surplus is reduced and the increase in pesticide use is, to some extent, mitigated. Even when no increase in pesticide use is permitted the reduced tillage system seems to be more profitable than conventional tillage systems.

Reducing ammonia emission from agriculture using the BATNEEC approach in Denmark

Abstract This article looks at how the Best Available Technology Not Entailing Excessive Costs (BATNEEC) can be implemented in practice using the ammonia regulation in Denmark as an example. The reductions of ammonia emissions in Denmark have been achieved mainly through command and control measures. The analysis in this paper shows how cost-effectiveness analyses (CEA) and analysis of the cost for the farmers (affordability) can be used to point out relevant BAT (Best Available Technology) technologies. The article discusses how the cut-off values are to some extent political as it can be difficult to set objective cut-off levels for the sector costs. The article describes different approaches on how to calculate affordability and finishes with a description of the final regulation as it has been implemented in Denmark. It shows that a stricter emission target on larger farms has counteracted the economics of size. The implication is that the abatement costs are similar on all farms. The wider implication of the findings suggests that the actual implementation of the BATNEEC at a national level can be counteracted if the local regulator has to perform case-by-case analysis. The case-by-case analysis might give more cost effective solutions, but it increases the administrative costs and delays the acceptance procedure. The article shows that the BATNEEC implementation approach is successful, although it requires some political and administrative choices to be able to push new technology in a cost efficient manner.