darko znaor

Externalities of Nitrogen FertilisersDr Darko Znaor

Contents

1. Why N fertilisers?2. How to assess its

externalities?3. Policy implications

WHY N FERTILISERS?

Benefits of N fertilisersBenefits of N fertilisers

• Higher yields• Cheap (“value for money”)• Easy to transport, store & apply• Non-toxic & non-smelling• Enhance C storage in biomass

• Higher yields• Cheap (“value for money”)• Easy to transport, store & apply• Non-toxic & non-smelling• Enhance C storage in biomass

Downside of N fertilisers - manufacturingDownside of N fertilisers - manufacturing

• Energy intensive (fosil fuels)

• Polluting• Often subsidised

• Energy intensive (fosil fuels)

• Polluting• Often subsidised

• Environmental problems (air/climate, soil, water, BD)

• Declining yield response• Secondary effects (pests, weeds, freezing, etc.)• Fertiliser dependency

Downside of N fertilisers - applicationDownside of N fertilisers - application

N fertilisers consumption 2000-2011

Source: IFA, 2013

A METHODOLOGICALFRAMEWORK

for assessing N fertilisers

externalities

A framework for assessing N fertilisers externalitiesA framework for assessing N fertilisers externalities

Damage to:• Air• Climate• Water• Soil• Biodiversity

Damage to:• Air• Climate• Water• Soil• Biodiversity

Subsidies:• Production• Transport• Application

Subsidies:• Production• Transport• Application

External cost

External cost

QUANTIFICATION OF EMITTED POLLUTANTS

CO2

N2O

SO2

NOx

NH3

PM10

PM 2.5

Data source: UNFCCC, LRTAP, Gothenburg Protocol & E-PRTR

NOx

NH3CO2

N2

O

N2

O

Atmos. depos.indirect

N2

O Leaching& run-off

Soil

Leachingindirect NO3

NO2

NH4

Source of data: UNFCCC & LRTAP reports, N balances

MONETARISATION

Pollutant

Damage (EUR/t)Method

Low High

CO2 33*

33*

Marginal abatment cost

NH3 1,335*

76,193*

VSL or VOLY

NOx 647*

51,580*

VSL or VOLY

PM 2.5 7,134 *

124,873*

VSL or VOLY

PM 10 4,632*

81,086*

VSL or VOLY

N (water)

100**

4,000**

VSL (colon cancer)

N (water)

5,000**

20,000**

WTP (eutrophication)

Monentarisation of emissions

* EEA, 2011. Revealing the costs of air pollution from industrial facilities in Europe. European Environment Agency, Cohenhagen.

** Sutton et al. (eds.), 2011. The European Nitrogen Assessment. Cambridge University Press. Cambridge .

UK agriculture: environmental cost of N fertilisers

Source: own calculation

216 EUR per ha or 36% of UK’s agrculture gross-value added

POLICYIMPLICATIONS

Two-track policy approach Two-track policy approach

1. Economic instruments (“market”) • Deterring (taxes, levies, fines,

etc.)• Stimulating (subsidies, lower

VAT, etc.)

2. Awareness raising (“church”)

1. Economic instruments (“market”) • Deterring (taxes, levies, fines,

etc.)• Stimulating (subsidies, lower

VAT, etc.)

2. Awareness raising (“church”)

CONCL

USI

ONS

N fertilisers = a mixed blessing

• A cornerstone of doping agriculture• Based on fosil fuels = unsustainable =

lovely while it lasts!• Huge externalities (e.g. 36% of UK’s

agric. GVA)• A two-track policy needed• Green taxes (short-term)

THANK YOU!darko@znaor.eu