Reducing acidification: the benefits of increasednature quality

Investigating the possibilities of the Contingent Valuation Method

Dr.ir. E.C.M. Ruijgrok,09/02

Acidification abatement leads to costs, but it also generates benefits:

• reduced health risks;• less damage to buildings;• less damage to crops;

• increased nature quality.

monetarised

€

Core question

Can CVM be used to include the benefits of increased nature quality in Cost Benefit Analyses for acidificationabatement scenarios?

Method

Trial and error; a CVM survey was set up and tested

Research questions

1. Which functions of nature are affected by acidification?

2. Can these functions be monetarised by means of CVM?

3. Is it possible to distinguish different nature benefits per acidification abatement scenario?

• CO2 fixation

• Nitrogen storage

• Aluminium binding

• Binding heavy metals

• Recreational perception

• Non-use

A previous study showed that the following functionsare affected by acidification:

CVM

What is CVM?

• survey method

• it measures willingness to pay

hypothetical market

little story explaining the effects of acidification on nature to lain man

Option A: realise improvementThe government takesextra measures to reduce acidification to such an extentthat nature is healthy againin the year 2030

a yearly donation per household

Essential elements of CVM: non-use value

description

of the good

payment

vehicle

Option B: preventdeterioration

Essential elements of CVM:perception value

hypothetical market

description

of the good

payment

vehicle

photos of affected and unaffected forests, health lands, fens, grass lands and dunes

Entrance fees for natureareas depend on beauty

Entrance fee per visit

Sources of bias

1. The design of the questionnaire influences answers

2. Unfamiliarity with and difficulty of the questions

3. The respondent does not state his actual wtp

?

• bidders• zero bidders• protest bidders• ‘whole bidders’

Socially correctbehaviour Provide opportunity to say no

Starting point Open ended questions

Part whole Filter, zoom in

Bias: Precaution:

Register different types of bidders:

Distinguishing benefits per scenario

A. Netherlands NEC, rest of the world GothenburgB. Ammonium and nitrogen deposition minimizedC. EU NEC, rest of the world GothenburgD. All countries GothenburgE. Netherlands extra strong policy, rest Gothenburg

Dutch acidification abatement scenarios:

Abatement scenarios

Ammonium depositions for different emission scenarios

NH3-depositie

02004006008001000120014001600

1990 2000 2010 2020 2030 2040 2050 2060

jaar

molc/ha/j

A

C

D

E

Source: Kros et.al., 2000.

Different paths to the same deposition level

The scenarios differ little in biodiversity effects

Physical differences cannot be explained to lain man nor be shown on photos

CVM cannot distinguish benefits per scenario

Extra question on time

BUT:

Possible solution:

Determine benefits of extreme scenariosDerive benefits of less extreme scenarios from these

This requires agreements, decision rules

Pre Test and Preliminary results

Findings:

• most respondents were familiar with acidification• Euro leads to higher bids• bids for sooner improvements• Is acidification the biggest threat to nature?

A small pre test was held in nature reserve Meijendel and the city centre of Zoetermeer

Part whole bias ?

• non-use value varied from € 0 to € 100 per hh per year

Averge wtp : € 30 per hh per year

Households: 6.2 million

Rough estimate: € 207 million per year

• recreational use: average wtp 6 per visit

Preliminary results

Comparing the different benefits of acidification

Nature: ± € 207 million per year

Health: € 900 million per year (2010)

Ground water contamination: € 60 million in total

Damage to materials: € 59 million per year

Conclusion

Recommendation

• The benefits of nature are worth investigating

• CVM can be used to estimate the non-use and recreational benefits of nature • CVM is not suited for distinguishing benefits per abatement scenario if scenarios differ little• Decision rules for derivation are needed

For a Europe wide application adaptations are needed,paying attention to sources of bias:

Which?