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Ex ante and ex post costs of implementing the Nitrates Directive Case study in the framework of the project ‘Ex post estimates of costs to business of EU environmental policies’

Onno Kuik

June 2006

ii

IVM

Institute for Environmental Studies Vrije Universiteit De Boelelaan 1087 1081 HV Amsterdam The Netherlands

Tel. ++31-20-4449 555 Fax. ++31-20-4449 553 E-mail: [email protected]

This report was commissioned by: European Commission, DG Environment, Unit G.1 Sustainable Development & Economic Analysis, under a framework contract No ENV.G.1/FRA/2004/0081.

The contents and views contained in this report are those of the authors, and do not

necessarily represent those of the European Commission.

mailto:[email protected]

Ex ante and ex post costs of the Nitrates Directive i

Contents

Executive summary iii

Abstract v

1. Introduction 1

2. The Nitrates Directive and associated actions at the farm level 3

3. An ex-ante estimate of costs across the EU15 5

4. Estimates of ex-ante and ex-post costs in selected Member States 9 4.1 Introduction 9 4.2 Croatia 9 4.3 Denmark 10 4.4 England 11 4.5 Finland 12 4.6 France 13 4.7 Italy 13 4.8 Lithuania 14 4.9 Netherlands 15

5. Comparison of cost estimates across different Member States 21

6. Conclusions 25

References 27

Appendix I. Agricultural areas requiring measures to address a nitrogen surplus from manure production (1991). 29

Ex ante and ex post costs of the Nitrates Directive iii

Executive summary

Scope and time frame This case study examines the differences in ex ante and ex post estimates of the costs to farmers of the implementation of the EU Nitrates Directives. The Nitrates Directive aims to protect European waters against pollution caused by nitrates from agricultural sources. The case study reviews national esimates from seven EU Member States and Candidate countries: Croatia, Denmark, France, Italy, Lithuania, Netherlands, Finland, and the United Kingdom.

A comparison between ex-ante and ex-post estimates could only be made for Denmark and the Netherlands, where it should be noted that the European Court of Justice ruled in 2003 that the Netherlands had not properly implemented the Nitrates Directive in its national legislation. Strictly speaking then, this would only leave the case of Denmark for comparison of ex ante and ex post cost estimates. Because we are of the opinion that something can be learned from the Dutch case despite its legal shortcomings, we have nonetheless included the Dutch estimates in this report.

For Denmark and the Netherlands, ex-ante cost estimates were produced in 1997/98 and ex-post estimates in 2002/3.

Differences between ex ante and ex post costs and causes of these differences The case study reveals large differences in costs per hectare among the countries, but it is unclear to what extent these differences are ‘real’ or the result of methodological differences across the studies.

The ex-ante estimates of cost per kg nitrogen (N) reduction were between 1.2 and 1.9 times higher than the ex-post estimates. For Denmark, the major reasons for this difference were that the stricter requirements on the utilisation of the N content of animal manure turned out to be much cheaper than expected at the time of the ex-ante estimate. For the Netherlands, the major difference was that the expected costs for dairy farms to dispose of their surplus manure were much smaller than expected, largely because of a more rational management of fertilisers at these farms. Both for Denmark and the Netherlands, the costs of nitrate measures at the farm level were lower than expected because of improved fertiliser management.

Ex ante and ex post costs of the Nitrates Directive v

Abstract

This report reviews studies of the costs to farmers of the implementation of the provisions of the EU Nitrates Directive across seven EU Member States and one Candidate Country. The aims of the review are twofold. The first aim is to compare the costs of the Nitrate Directive across different Member States and to explain differences in costs by its underlying factors, for example by different modes of implementation of the provisions of the Directive. The second aim is to compare ex-ante and ex-post estimates of costs to find out whether ex-ante estimates of costs are structurally biased, i.e., whether they over or underestimate the ‘true’ costs of the Directive (as measured by the ex-post estimates). If such structural biases exist, what are their main causes?

The Table below presents ex-ante estimates of the costs of farm-related measures. The Table presents two sets of ex-ante estimates, one set of estimates from an EU-wide study (Andrews et al., 2000), and a set of estimates from selected national studies.

Ex-ante estimates of costs of the Nitrates Directive and associated measures across European countries (€, prices of 2004). Andrews et al. National estimates € mio.y-1 €.ha-1 y-1 € mio.y-1 €.ha-1 y-1 € kgN-1

Denmark 63 90 72 103 2.7 Finland n.a. n.a. 67 n.a. France 78 104 20-46 25-61 1.2 Netherlands 215 155 326 236 3.5 United Kingdom 125 48 30 6 Lithuania n.a. n.a. 7-14 50-57 Croatia n.a. n.a. n.a. 43 0.4

The estimated costs of the Nitrates Directive differ across Member States. We found a range of costs from € 6 to € 236 per hectare affected, and from € 0.4 to € 3.5 per kg N. The differences can be caused by differences in industry structure, livestock intensity, historical rates of fertiliser application, and the vulnerability of soils to nitrate leaching. With regard to the national estimates, differences may also be due to different assumptions and methodological differences.

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Methodological differences among national estimates Representative

sample Manure storage and other investment costs

Yield effects

Offsetting savings

Administrative costs at the farm

Leaching as function of application

Denmark Yes Yes Yes Yes No Yes Finland Unknown Unknown Unknown Unknown Unknown Unknown France No Yes Yes Yes Unknown Yes Netherlands Yes Yes Yes Yes No No England Yes Yes No Yes Yes No Lithuania Unknown Yes No No No No Croatia No No Yes No No Yes

The cost estimates of France and Croatia are based on local case study research, not representative for the entire country. It is unknown if the estimates of Lithuania and Finland are based on representative samples. Most of the estimates include some measure of investment costs in manure storage facilities at the farm, except for Croatia. Some estimates take account of yield effects due to a limitation of fertiliser and offsetting savings due to a more rational application of fertiliser, but others do not. The British estimate includes relatively high costs of adminstration at the farm, while other estimates neglect these costs. Finally, while the Danish, Croatian and French studies explicitly relate fertilser application to the leaching of Nitrogen to ground and surface waters, other studies only estimate the effects of the Directive to the application (“deposition”) of N-fertiliser to land.

On the basis of the present review it is impossible to relate the cost differences to differences in the application of more or less efficient policy instruments across Member States.

We found ex-ante and ex-post cost estimates of nitrate policies in Denmark and the Netherlands. We compare estimates of two different indicators of costs: costs per hectare and cost per kg N reduction. For both indicators we find that the ex-ante estimate is at least as large as the ex-post estimate and usually larger. For the ‘cost-per-hectare’ indicator, the ex-ante estimate is between 1 and 1.7 times as large as the ex-post estimate. For the ‘cost-per-kgN’ indicator, the ex-ante estimate is between 1.2 and 1.9 times as large as the ex-post estimate.

Ex ante and ex post costs of the Nitrates Directive vii

Comparison of ex-ante and ex-post estimates of the costs of N-reducing policies in Denmark and the Netherlands (€, prices of 20041)). Ex-ante Ex-post Ratio Exante/

Expost costs Ratio Exante/Expost cost-effect.

€.ha-1 y-1 €.kgN-1 €.ha-1 y-1 €.kgN-1 Denmark 103 2.7 62 1.4 1.7 1.9 Netherlands2) 174 2.0 174 1.7 1.0 1.2

The sample of estimates is too small, however, to draw firm conclusions with respect to a possible ‘structural bias’. The comparison of ex-ante and ex-post estimates of the Netherlands suggested that the ex-ante estimate did not foresee the efficiency gains in the dairy sector that, through a more rational management of fertilisers, offset part of the ex-ante expected costs. It should be remembered, however, that these efficiency gains came about under the MINAS policy programme. This policy has been terminated. Whether the implementation of the new manure policy in the Netherlands would yield similar efficiency gains remains to be seen.

Ex ante and ex post costs of the Nitrates Directive ix

Ex ante and ex post costs of the Nitrates Directive 1

1. Introduction

This report reviews studies of the costs to farmers of the implementation of the provisions of the EU Nitrates Directive across seven EU Member States and one Candidate Country.

The aims of the review are twofold. The first aim is to compare the costs of the Nitrate Directive across different Member States and to explain differences in costs by its underlying factors, for example by different modes of implementation of the provisions of the Directive. The second aim is to compare ex-ante and ex-post estimates of costs to find out whether ex-ante estimates of costs are structurally biased, i.e., whether they over or underestimate the ‘true’ costs of the Directive (as measured by the ex-post estimates). If such structural biases exist, what are their main causes?

The selection of countries is based on 1) the preferences of the Commission, and 2) the availability of accessible studies. Based on these criteria, the following Member States and Candidate Countries were selected: Croatia, Denmark, France, Italy, Lithuania, Netherlands, Finland, and the United Kingdom. These Member States and Candidate Countries represent a wide range of natural, agronomic, economic and administrative environments across Europe.

The reports starts in Chapter 2 with a brief description of the history, aims and provisions of the Nitrates Directive and associated actions at the farm level. Chapter 3 presents the results of an ex-ante study of the costs of implementing the Nitrates Directive across all 15 ‘old’ Member States. It then continues with a survey of ex-ante and ex-post cost studies across the selected eight Member States and Candidate Countries (Chapter 4). Chapter 5 presents an overall comparison of the cost estimates, while Chapter 6 concludes.


2. The Nitrates Directive and associated actions at the farm level

Because of environmental and health concerns over increasing nitrate concentrations in surface and ground waters in the EU, especially in intensively farmed agricultural areas, in 1991 the Council of Ministers adopted a Directive on the protection of waters against pollution caused by nitrates from agricultural sources (the Nitrates Directive, 91/676/EEC). The ultimate goal of the Nitrates Directive is “reducing water pollution caused or induced by nitrates from agricultural sources and preventing furrther such pollution” (Art.1). The Directive refers to environmental standards laid down in a Council Directive of 1980 (80/778/EEC) relating to the quality of water intended for human consumption, which sets a “Guide Value” of nitrates in water of 25 mg NO3.ℓ-1 and a “Maximum Allowable Concentration” of 50 mg NO3.ℓ-1.

The Directive contains a number of provisions for the governments of Member States that include (Andews et al., 2000):

• The transposition into national law and monitoring of all waters by 1993;

• Identification as Nitrate Vulnerable Zones (NVZs) all areas of land that drain into waters affected by nitrate pollution or may be affected in the near future without measures or where eutrophication exists;

• Establishment of a Code of Good Agricultural Practice to be implemented on a voluntary basis (with training programmes as necessary) for the whole territory of the Member State;

• Action programmes formulated and implemented by 1996 for designated NVZs based on standards contained in the Code of Good Agricultural Practice which become binding for farmers in NVZs. Action plans must include a maximum per hectare application rate of nitrogen from animal manure of 170 kg N.ha-1.

The Code of Good Agricultural Practice should contain measures relating to where and when fertilsers should be applied; how animal manure should be stored; and how manure and fertiliser should be applied. Specifically for designated NVZs, action plans contain measures on:

• The period when fertiliser application is prohibited;

• Storage capacity for animal manure or environmentally sound disposal;

• Limits on the application of fertilisers to land, taking into account soil conditions, type, slope, climatic conditions, land use and crop rotation systems, and to balance nitrogen supply and demand of crops.

On the basis of a survey of literature, Andrews et al. (2000) identify a large number of actions that can be taken at the farm in order to comply with the Directive (Table 2.1).

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Table 2.1 Actions associated with Nitrates Directive Fertiliser application rate Farm fertiliser plans Application practices Irrigation controls Capacity and design of animal manure storage facilities

Composition of animal feed-stuffs

Emission control measures for storage facilities Animal feed practices Crop rotation systems Off-farm environmentally sound disposal Ratio of permanent to annual tillage crops Cropping patterns or amounts grown Vegetation cover during rainy periods Livestock patterns or numbers Source: Andrews et al. (2000)


3. An ex-ante estimate of costs across the EU15

In a study for DG Environment in the year 2000, Andrews et al. (2000) made an ex-ante estimate of the costs of the Nitrates Directive to farmers across the EU. On the basis of a review of literature, they first estimated unit costs per hectare of actions for different farm types in different Member States, which they subsequently aggregated to the national level on the basis of land areas of the different farm types in NVZs in the Member States.

Table 3.1 shows the estimated unit costs per hectare of measures for, respectively, the arable sector, dairy, beef, pigs and poultry, and mixed farms. The similarity of unit costs across most countries is mainly due to the fact that the literature review only yielded partial results for a limited number of Member States (Germany, France, Netherland, and the United Kingdom).

Table 3.1 Unit costs associated withtheNitratesDirective (€.ha-1.y-1, prices of 1997/8) Crops Dairy Beef Pigs &

Poultry Mixed

Austria Belgium 45 100 204 45 Denmark 45 204 Germany 67 Greece 45 100 204 Spain 45 204 Finland France 204 45 Ireland Italy 45 100 204 Luxembourg 204 Netherlands 129 100 658 45 Portugal 204 Sweden United Kingdom 45 30 Source: Andrews et al., 2000.

Table 3.2 shows the estimated aggregated cost per farm type across the different Member States, based on the unit costs of Table 3.1. Total costs of the Nitrates Directive to farmers in the EU15 would amount to € 635 million per annum, with the highest costs in the Netherlands (€179 mio.y-1), France (€ 70 mio.y-1), and Spain (€ 70 mio.y-1). Per farm type, the highest costs would be for dairy (€ 348 mio.y-1), and pigs and poultry (€ 163 mio.y-1).

On a per hectare basis, Table 3.2 shows that the measures of the Nitrates Directive would costs on average € 75 per hectare per year for the area on which measures would be

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required. The highest costs per hectare are for Portugal,1 and the Netherlands, while the lowest costs are for the United Kingdom. Andrews et al. (2002) base the size of the affected agricultural area per Member State on estimates of Brouwer et al. (1995). We will also use these area estimates of Brouwer et al. in further calculations in this report. The Brouwer et al. estimates are reproduced in the Appendix to this report. The affected share of agricultural area ranges from 0 percent in Ireland, Portugal and Luxembourg to 71 per cent in the Netherlands and 77 percent in Belgium.2

Table 3.2 Total costs under the Nitrates Directive (mio €.y-1, prices of 1997/98) Crops Dairy Beef Pigs and

Poultry Mixed Total Total

per ha* Austria n.a n.a. n.a. n.a. n.a. n.a. n.a. Belgium 19 20 4 19 62 58 Denmark 25 30 55 79 Germany 5 5 64 Greece 1 24 0 25 95 Spain 38 32 70 70 Finland n.a n.a. n.a. n.a. n.a. n.a. n.a. France 46 24 70 93 Ireland 0 0 Italy 18 21 11 49 75 Luxembourg 0 0 Netherlands 135 9 28 7 179 129 Portugal 4 4 199 Sweden n.a n.a. n.a. n.a. n.a. n.a. n.a. United Kingdom 113 2 114 44 EU15 348 74 163 50 635 75 * Per hectare of land that is estimated to require measures under the Nitrates Directive (see text).

Source: Andrews et al., 2000.

Andrews et al. (2000) point out that these ex-ante estimates are very rough first guesses. Apart from the limited number of studies available, Andrews et al (2000) identify a number of sources of potential bias:

1. Researchers have focussed on the more tractable problems (e.g., compliance with the manure application norm);

2. Researchers have focussed on the more pressing environmental problems which may not represent the general character of the problem (e.g., the most intensive agri-systems);

1 That the highest cost per hectare are for Portugal is probably partly due to the fact that all

Portuguese measures relate to pigs and poultry, where the land intensity may be quite high. 2 The affected area per Member State may not coincide with the designated NVZ. For

example, in the Netherlands 100% of the area is designated as NVZ, but only 71 percent of the area is estimated to be affected by nitrate pollution reduction measures. General cropping farms are not predicted to be affected (Brouwer et al., 1995).


3. Researchers have focussed on the more novel abatement strategies (e.g. adjusting feedstuff compositions).

As a result, the cost data is not likely to be representative of the general character of the problem. In particular, the studies have paid insufficient attention to the costs of measures applicable to arable agri-systems (Andrews et al., 2000: 167).


4. Estimates of ex-ante and ex-post costs in selected Member States

4.1 Introduction In this chapter, we present a number of ex-ante and ex-post cost studies in the selected EU Member States and one Candidate Country. We present national or regional cost estimates from Croatia, Denmark, Finland, France, Italy, Lithuania, Netherlands, and the United Kingdom.

4.2 Croatia As a Candidate Country, Croatia is examining the implications of the Nitrates Directive for its farmers and its environment. Croatian farming systems can be as intensive as those in some Western European countries. There is evidence that nitrate leaching is endangering drinking water supplies in some areas (Sumelius et al., 2002).

Sumelius et al. (2002) estimated nutrient balances for 20 family farms near a protected nature park, Lonja field, that were mainly engaged in the cultivation of maize and winter wheat. The farms used 234 to 236 kg.ha-1 pure N in wheat production and 206 to 230 kg.ha-1 pure N on maize, from both mineral fertiliser and animal manure. N-leaching was estimated by a leaching function, estimated on data of Croation lysimeter experiments during the period 1996-1999. Sumelius et al. (2002) suggest that the application of mineral fertiliser in their sample was near optimal levels, but that total N gift including animal manure clearly exceeded these levels. Leaching of nitrogen led to nitrate concentrations in drainage water of 82 to 96 mg NO3.ℓ-1 , almost twice as high as the standard of the Nitrates Directive (50 mg NO3.ℓ-1 ).

Sumelius et al. (2002) also estimated the marginal abatement costs of measures to reduce fertiliser application to levels consistent with the requirement of the Nitrates Directive, i.e., leaching not exceeding 50 mg NO3.ℓ-1 drainage water. They first estimated N-response functions for maize and wheat. Then they calculated the effect on gross margins of lowering N gifts. They found marginal abatement costs between € 0.92/mg NO3.ℓ-1 and € 9.32/mg NO3.ℓ-1, with the lowest value for a system of N-quota and the highest value for a product tax on maize. A fertiliser tax was estimated to yield marginal costs of € 3.65 /mg NO3.ℓ-1. Expressed in N, the costs would be € 4.08/mg N.ℓ-1 or € 0.4 per kg N fertiliser avoided. The cheapest way to reduce leaching to the Nitrates Directive water quality standards on the investigated farms would be around € 43 per hectare.3

The cost estimates of Sumelius et al. (2002) should be interpreted with caution, however, as the sample of farms is small, and the calculations are rather academic. The estimate of costs does not include investment costs of, for example, manure storage facilties

3 Required reduction per ha is 10.65 mg N.ℓ-1; total costs is 10.65 mg N.ℓ-1 x 4.08 €/ mg N.ℓ-1

= € 43.

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4.3 Denmark Denmark has a large animal production sector, and its livestock density is among the highest in Europe. A high level of nitrogen application to the land, through animal and mineral fertiliser, resulted in a high rate of leaching of nitrates to surface waters. From the mid-1980s, the Danish government has developed actions and strategies to reduce this leaching. In 1998, the Danish Parliament enacted the Action Plan on the Aquatic Environment II, with the aim of further reducing nitrogen leaching by 37,100 ton per year by the year 2003, which was expected to bring Denmark in compliance with the EU Nitrates Directive.

The Action Plan contains sets of measures for the State and for farmers. State measures include the management and expansion of wetlands and forests as sinks for nitrogen. Farm measures include, among others:

• Improved fodder utilisation and changes in feeding practice;

• Stricter criteria for livestock density;

• Stricter requirement on the utilisation of the N content of animal manure;

• Increase the area of catch crops by a further six percent of farmland;

• Reduce the N application norm by ten percent, that is, farmers may apply nitrogen in fertiliser in amounts of up to 90 percent of the economically optimal level.

Jacobsen (2002,2004) compared the ex-ante and ex-post estimates of the environmental and economic effects of the Action Plan (Table 4.1). 4

Table 4.1 Ex-ante and ex-post estimates of the costs to farmers in Denmark Ex-ante (1998) Ex-post (2004) Reduction

of leaching (ton N)

Farm costs (€ mio.y-1)

Cost-effect (€.kgN-1)

Reduction of leaching (ton N)



N in feedstuffs

2400 0 0 3800 5.8 1.5

Stocking density

300 4.1 13.7 140 1.5 10.7

Catch crops (6%)

3000 20.3 6.8 3000 6.4 2.1

N-norms 10500 15.3 1.5 12850 22.8 1.8 Utilisation of manure

10600 27.2 2.6 10110 6.7 0.7

Total 26800 66.9 2.5 29900 43.1 1.4 Source: Jacobsen (2002,2004).

4 Note that the cost estimates do not include the costs of the increased administrative burden to

farmers because of the Action Plan.


In the ex-ante estimate the total anticipated reduction of N leaching from farms was 26,800 tons. The remaining 37,100 – 26,800 = 10,300 tons were anticipated to be achieved by State action. Most of the reduction of N leaching from farms was expected to be achieved by a lowering of the N-norms for fertiliser application and an increased utilisation of N in animal manure. The farm measures were expected to cost € 66.9 mio.y-1 and to result in reduced N-leaching of 26,800 tons per year. The average cost-effectiveness of the measures were expected to be € 2.5 per avoided kg N leaching.

The ex-post evaluation showed that the farm measures of the Action Plan had been successful in reaching their environmental target at less costs than expected. The farm measures reduced N-leaching by 29,900 tons per year at total annual costs of € 43.1 mio. The average cost-effectiveness of the farm-related measures fell from € 2.5 kg. N-1 to € 1.4 kg. N-1 between the ex-ante and ex-post assessment.

The effects on N-leaching of the State measures of the Action Plan were less than expected. It was anticipated that they would reduce N-leaching by 10,300 tons, but the ex-post estimate only attributed a reduction of 6,000 tons to these measures. With the exception of the creation of wetlands, which was evaluated as very cost-effective (€ 0.9 kg.N-1), State measures were also less cost-effective than the farm-related measures. It has been pointed out, however, that many of the area-related State measures (such as voluntary agreements in environmentally sensitive areas and the stimulation of organic farming), usually provide additional benefits in the form of less phosphorus losses, less pesticide usage and greater nature diversity which would increase their broader environmental cost-effectiveness (Jacobsen, 2004).

4.4 England The implementation of the Nitrates Directive in England has been slow (Grossman, 2000), but now the Government has designated 55 percent of England’s farm land as NVZs and it has carried out a Regulatory Impact Assessment to assess the costs of the implementation of the Directive (DEFRA, 2002).

The Regulatory Impact Assessment estimated the net annual compliance costs at € 28 million (₤ 19.3 mio.) or, on average, € 395 per year per farm affected. If we assume that 55 percent of the agicultural area of England5 is affected by the Nitrates Directive, the annual costs per hectare are € 5.9.6 More than half of these costs is due to additional administrative requirements for farmers (“record keeping”), a quarter is for additional storage facilities for manure, and the remainder is for transport of manure between farms. These costs figures do not take into account the possibility that the investments in storgae facilities can be subsidised under the Farm Waste Grant Scheme (40% grant rate), hence lowering the net costs to farmers.

The Regulatory Impact Assessment distinguished a number of farm sectors: dairy, beef, sheep, pigs, and poultry. The highest costs are for pig and dairy production. Typical expenditures for a slurry storage facility are € 45,000 to € 60,000 (DEFRA, 2002).

5 Total utilised agricultural area is of England (excl. Wales) is 8,737,000 ha (Eurostat, 2005). 6 We can not use the Brouwer et al area estimates here as they refer to the United Kingdsom,

rather than to England.

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The Regulatory Impact Assessment also accounts for cost savings to farmers because of expected reduced expenditure on mineral fertiliser. Table 4.2 presents the detailed cost estimates of the various measures for the different sectors.

Table 4.2 Ex-ante estimate of costs to farmers in England (₤) Sector and measure Proportion of farms

affected (%) Estimated number of farms affected

Total annual costs ₤

Dairy – Storage 11 1,110 3,389,000 – Transport 10 1,028 543,000 Beef – Storage 3 450 158,000 – Transport 0 0 0 Sheep – Storage 0 0 0 – Transport 0 0 0 Pigs – Storage 11 500 1,801,000 – Transport 100 4,587 2,703,000 Poultry – Storage 0 n.a. 0 – Transport 100 n.a. 938,000 Record keeping (all sectors)

100 71,406 12,139,000

Total Gross Costs 21,671,000 Offsetting Savings 2,400,000 Total Net Costs 19,270,000 Source: DEFRA, 2002 Unfortunately, the Regulatory Impact Assessment does not report on the environmental consequences of the evaluated measures.

4.5 Finland Finland joined the EU in 1995. At that time, it had already an agri-environmental policy in place, based on voluntary standards, information, and subsidies for environmental investments (Kröger, 2005). It is claimed that this agri-environmental programme sets stricter requirements on the application of N nutrients in fertiliser than the Nitrates Directive (Huhtala, 2005). The problem with the implementation of the Nitrates Directive in Finland is twofold. First, under the agri-environmental programme farmers get support for environmental measures, which would under the Nitrates Directive become mandatory and thefore not eligible for financial compensation. Second, the responsibility for agri-environmental policy would shift from the Ministry of Agriculture and Forestry to the Ministry of the Environment (Kröger, 2005).

In a report of the Ministry of Agriculture and Forestry, it was claimed that implementation of the Nitrates Directive would cost Finnish farmers € 67 million per year as of the year 2000. There is some reason, however, to be skeptical about this cost


assessment, due to the highly conflictuous relationship on this issue between the Ministry of Agriculture and Forestry on the one hand, and the Ministry of the Environment on the other hand (Huhtala, 2005). Unfortunately, we have no information on how these costs were calculated.

4.6 France As a response to the Nitrates Directive, the Government of France launched the Ferti-Mieux (improved fertiliser) programme in 1991. Its aim is to encourage farmers to take care of the (aquatic) environment on a voluntary basis. In the year 2000, the programme involved 22,000 farmers and 1.3 million hectares of farm land (European Commission, 2002). Bel et al. (1999) estimated the cost-effectiveness of two measures within this programme for the locality of Bièvre-Liers in the Rhône-Alpes region. The FARM measure stimulates rational fertilisation, while the CIPAN measure also provides incentives for the management of catch crops and crop residues. The costs of FARM alone are estimated at € 22 per ha, while the costs of a combination of FARM and CIPAN are estimates at € 53 per ha. The combination of the measures from FARM and CIPAN are expected to bring down nitrate levels in groundwater to the European Commission’s Guide Value of 25 mg NO3.ℓ-1 at € 1.38 per kg N reduction. (see Table 4.3).

Table 4.3 Costs and environmental effects of N reduction measures in the locality of Bièvre-Liers in the Rhône-Alpes region.

FARM FARM + CIPAN Reduction in N leakage (kg.ha-1)

21 38

Expected N concentration (mg NO3.ℓ-1)

44 27

Costs per ha (€.y-1) 22 53 Cost effectiveness (€.kgN-1) 1.07 1.38 Source: Bel et al., 1999 and European Commission, 2002.

4.7 Italy In Italy, Roest and Bonazzi (2003) estimated the costs of the Nitrates Directive to pig farms in Lombardia and Piemonte. They distinguished between four measures with increasing costs:

• Transporting and spreading surplus manure to farms in the vincinity;

• Transporting and spreading surplus manure to farms at a greater distance;

• Seperation of manure in dry and wet fractions;

• Separation and further treatment of manure.

They estimated the effect of these measures on the production costs of pork in two ‘model’ farms: one with 1000 pigs and a farm area of 68 ha, and the other with 5000 pigs and a farm area of 343 ha.

Roest and Bonazzi (2002) estimated an increase in the production costs of pork from 4.7 percent to 9.5 percent. Table 4.4 presents a calculation of the total costs of the Nitrates

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Directive to pig farmers in Italy, based on a simple extrapolation of the cost increases for pork on the ‘model’ farms as calculated by Roest and Bonazzi.

Based on assumptions of Roest and Bonazzi and Brouwer et al. (1995), total annual costs of the Nitrate Directive to Italian pig farmers would be between € 8 and € 15 million, depending on the necessary types of measures and farm size.

Table 4.4 Ex-ante estimate of the costs to pig farmers in Italy Low esitmate High estimate Basic production costs (€/kg pork)

1.28 1.28

Increase in production costs due to Nitrates Directive (€/kg pork)

0.06 (4.7%) 0.12 (9.5%)

Kg pork per pig 160 160 Pigs per farm 1000 5000 Area (ha) 68 343 Extra costs per pig (€) 9.98 19.40 Extra costs per ha (€) 144 283 Total pig area with surplus manure in Italy (ha)(1)

52,287 52,287

Total costs (€ mio.y-1) 7.5 14.8 Source: Roest and Bonazzi, 2002, (1)Brouwer et al, 1995, and own calculations. As in the case of Croatia, the Italian cost estimates of should be interpreted with caution, as the sample of farms is small and the calculations are rather academic. The authors do not report on the environmental consequences of the measures.

Because of the fact that the Italian cost estimate only refers to pig farming, we can not give a national estimate.

4.8 Lithuania In the past decade, the use of fertilisers has fallen considerably in Lithuania, as in most Central and Eastern European countries. The average amount of nitrogen fertiliser applied to agricultural lands is below the Nitrates Directive application norm of 170 kg N per hecare.

There are, nevertheless, some large and intensive farms in Lithuania, mostly pig farms, that will need investments in manure storage facilities and disposal equipment to comply with the Nitrates Directive. Moreover, investments are needed for water quality monitoring and for training and awareness creation of farmers and the rural public (DEPA/DANCEE, 2004).

Lithuania applies an action program on its whole territory under the Nitrates Directive. Measures will nebe adopted in two stages: until 2007 Lithuania will implement mandatory measures for big farms (> 300 livestock units), and after 2007 mandatory measures for all farms above 10 livestock units come into force. Two estimates of the costs of the Nitrates Directive were made in Phase I and Phase II of a research project carried out by a Danish-led consortium.


Table 4.5 presents low and high cost estimates from Phase I and Phase II of the research project. “Costs” in these studies are mainly levelised investment costs of manure storage facilities.The Phase I estimates range from € 35 million to € 65 million per year, while the Phase II estimates range from € 7 million to € 14 million per year.

Table 4.5 Earlier(Phase I) and later (Phase II) estimates of costs to farmers in Lithuania (€ mio.y-1)

Phase I Phase II Low High Low High Education 1 1 2 2 Manure storage and disposal

34 64 5 11

Cost savings – – – – Total 35 65 7 14 Source: DEPA/DANCEE (2004) and own calculations.

While the Phase II estimates still seem uncertain, it is clear that the Phase I estimates were little more than a very rough guess, based on the assumption that each livestock farm in Lithuania should invest in manure storage and disposal facilities. The Phase II estimates assume that only farms above 200 livestock units (high estimate) or 300 livestock units (low estimate) should make such investments.

Table 4.5 shows that the Lithuanian estimates do not include potential cost savings because of a better utilisation of animal manure. Although this possibility is acknowledged in principle in the research report, the difficulty is that there is no experience in Lithuania of animal manure actually being sold to other farms. A lack of data on these and other issues will necessarily make any cost estimate very difficult.

4.9 Netherlands Agriculture in the Netherlands is very intensive. A combination of high mineral fertiliser applications and a concentration of intensive, land-poor, livestock farms on sandy soils, resulted in high leaching of nutrients to ground and surface waters. It has been estimated that in the mid 1990s the total nitrogen input to agricultural land was 900,000 tons. Of this amount about two-thirds (625,000 tons) was spilled and emitted to air, water and soil (Olsthoorn and Fong, 1998).

Since the 1980s, the Netherlands government has developed policies to reduce environmental pollution by excess animal manure applications to soil. In the first instance, the policies were aimed at a more even geographical distribution of manure, on the timing and methods of application, and on a reduction of its phosphorus content (Eerdt et al., 2005). While the policies resulted in a reduction of local manure surpluses and a reduction of the phosphorus content of manure and phosphate leaching, they did little to reduce the total nitrogen input to agriculture and nitrate leaching.

In response to the EU Nitrates Directive, the Netherlands government introduced new legislation in 1998 as part of the Fertilisers Act. The most important piece of legislation

16

was the Mineral Accounting System (MINAS)7 that obliged farmers to keep record of nutrient flows entering and leaving their farms. If the difference between inputs and outputs of nutrient flows exceeded certain “loss norms”, a levy had to be paid. The MINAS “loss norms” depended on type of cultivation (arable, grassland), and soil type (sand, clay/peat, other), to take into account differences in leaching profiles.

In 2003, the European Court of Justice ruled that the Netherlands had not properly implemented the Nitrates Directive by MINAS and its accompanying measures. In essence, the Court ruled that the Dutch policy did not include measures to limit the land application of fertilisers, so that it could not ensure that the amount of livestock manure would not exceed a specified amount per hectare per year.8 As a consequence of this ruling, the Netherlands had to switch to a system of application norms for fertiliser and manure (Eerdt et al., 2005).

Prior to the new legislation in 1998, a number of ex-ante studies on the costs of manure and fertilser policy were carried out. We will present two examples of such studies.

The first ex-ante study is a modelling study from1997 (Helming, 1997). The study employs a mathematical agro-economic model to compute the effects of manure and fertiliser policy scenarios. The policy scenario relevant for Nitrate policies is the “SDM” scenario that restricts the application of animal manure to 170 kg N per ha, in accordance with the application norm of the EU Nitrates Directive. For a calculation of the costs of environmental measures, the “SDM” scenario is compared to a “Baseline” consisting of average data of the period ‘90/’91– ‘92/’93.

In the “SDM” scenario, the total N surplus in the Netherlands falls by 46,000 ton N. The annual costs to the farm sector – in terms of a loss of value added – are Hfl. 1.5 billion (or 18 % of value added) in prices of ‘90/’91– ‘92/’93. In Euros of 2004, this loss of value added would be € 921 million. The cost-effectiveness of nitrate reduction measures would be € 20.0 per kg N reduction.

The “SDM” scenario compares a manurre and fertiliser policy to be realised in the early 2000s to the situation of the early 1990s (the “Baseline”). The cost associated with the “SDM” scenario therefore also include all measures implemented in the 1990s period to the policy change in 1998. Between 1990/93 and 1997, however, the annual costs of various measures related to manure and fertiliser policy in the Netherlands already increased substantially (Eerdt et al., 2005b). The costs of the “SDM” scenario can therefore probably not be exclusively assigned to MINAS or the implementation of the Nitrates Directive.

Hoop and Stolwijk (1999) carried out a more precise ex-ante study of the economic effects of the 1998 policy change, in which they not only estimated the costs to farmers

7 Acompanying legal instruments included livestock quota, manure contracts, the livestock

farm closure scheme, and the Nitrate Projects Action Programme (Eerdt et al., 2005). 8 European Court, Case C-322/00.


of the proposed MINAS measures, but also the costs of meeting the manure application norm of the Nitrates Directive.9

They estimated total annual costs of MINAS of € 145 million, and total annual cost of a strict interpretation of the Nitrates Directive of € 271 million (Table 4.6). The major share of the costs (about two-thirds) falls upon the dairy sector, followed by the pigs rearing sector (breeding and fattening). The authors estimate that the net effect on the income of the arable sector will be positive under MINAS, while it would be negative under a strict interpretation of the manure application norm of the Nitrates Directive. This difference is due to their assumption that the Nitrates Directive’s use norm for animal manure would result in a substitution of mineral fertiliser for animal manure on many arable farms.

Table 4.6 Ex-ante estimates of costs of nitrate reduction policies in the Netherlands (€ mio.y-1, prices of 1997/8)

Costs of MINAS Costs of Nitrates Directive Dairy 97 194 Pig fattening 40 46 Sow breeding 26 42 Poultry 10 12 Arable – 28 22 Total 145 271 Source: Hoop and Stolwijk, 1999 Hoop and Stolwijk do not estimate the total amount of nitrate leaching avoided in the policy variants, but they do present estimates of the reduction of N surplus per hectare for certain farm sectors (specialised dairy: 73 kg.ha-1 for MINAS/78 kg.ha-1 for Nitrates Directive, mixed intensive animals: 71/80 kg.ha-1, and arable: 13/13 kg.ha-1). On the basis of these changes in per hectare surpluses, total avoided nitrate leaching can be very tentatively calculated as 87,000 ton N under MINAS and 92,000 ton N under the Nitrates Directive.10 A summary of ex-post estimates of MINAS by Eerdt et al. (2005a, 2005b) showed increasing additional costs to farmers over the MINAS period 1998-2002. In the Netherlands manure legislation was already in place in the period 1991-1997. The cost of manure-related measures increased because of MINAS (Table 4.7). On average, the annual net costs of MINAS to farmers were € 174 million. This estimate includes savings on fertiliser (€ 74 mio. in 2002) and subsidies (€ 69 mio. in 2002). With respect

9 In the calculations, the use norm for grassland is assumed to be 250 kg.N.ha-1 . This is

conform the derogation requested by the Dutch government. The derogation request is, however, still under consideration by the Commission.

10 For MINAS: 1,048,234 ha grassland * 73 kg/ha + 796,352 ha arable * 13 kg/ha = 86,874 ton N.

For Nitrates Directive: 1,048,234 ha grassland * 78 kg/ha + 796,352 ha arable * 13 kg/ha = 92,115 ton N.

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to specific measures, the highest costs were for manure disposal (37% in 2002) and administration (34% in 2002). The average annual costs per hectare were € 126.

Table 4.7 Ex-post estimates of costs to farmers of manure and fertiliser policy in the Netherlands, 1997-2002 (€ mio.)

1997 1998 1999 2000 2001 2002* Gross costs 199 350 428 504 540 525 Of which – Manure disposal 74 91 142 192 209 195 – Buying up schemes 0 2 37 66 56 56 – Manure storage 80 79 79 79 78 78 – Administrative costs 12 158 150 148 178 178 – Other 33 19 21 20 19 19 Savings on fertiliser use 0 0 3 32 71 74 Subsidies received 14 16 49 76 69 69 Net costs to farmers 185 334 376 396 399 380 Source: Eerdt et al. (2005b); * provisional figures The costs were unevenly divided among farm types, with low costs (and even possible increases in income) for dairy farms, and hight costs for intensive livestock (pigs and poultry) farms. Westhoek et al. (2004), estimate that annual manure disposal costs on intensive livestock farms increased from € 2000 per farm in the period 1988-2002 to approximately € 11,000 per farm in the period 1998-2000 under MINAS. By contrast, dairy farmers managed to lower their N surplus by reducing the input of mineral fertilisers and feed concentrates. Because of the associated cost savings, MINAS had little to no effect on average farm income in this sector. Westhoek et al. (2004) note that “a considerable number of [dairy] farms even improved their farm income, probably because there was room for improvement of the efficiency and because the introduction of MINAS made the farmers aware of this.” (Westhoek et al. 2004: 112).

We compare the ex-ante and ex-post estimates of the environmental and economic effects of N-reduction measures in Table 4.8.11 The comparison is complicated by a number of issues. In the first place, it is not clear if the two studies concern exactly the same set of measures. In the second place, the total amount of N-reduction differs across the studies and the amount of N-reducton that we calculated on the basis of the ex-ante study may not be correct.

Given these caveats, the comparison suggests that the ex-ante study and the ex-post estimtes of costs were remarkablty similar. In current prices, the ex-ante cost estimates was € 145 million while the ex-post estimate was € 174 million. In 2004 prices, total annual farm costs in the ex-ante and ex-post study were both € 174 million.

11 N-reduction is measured as the change of the application of N to the land.


Table 4.8 Ex-ante and ex-post estimates of costs to farmers of measures to reduce nitrate leaching in the Netherlands (MINAS).

Ex-ante (1999) Ex-post (2005) Reduction

of N-deposition (ton N)



Reduction of N-deposition (ton N)



Manure disposal

94

Administrative 132 Other

}173 – 16

Cost savings – 28 – 36 Total 87,0001) 145 2.0* 100,0002) 174 1.7

1. As explained in the text, this number is rather tentative. 2. Average annual reduction over the period 1998-2002.

Source: Hoop and Stolwijk (1999), Eerdt et al. (2005) and own computations.

But what is perhaps even more remarkable is the relative position of the dairy sector. While Hoop and Stolwijk (1999) predict that the dairy sector will have to shoulder the largest share of the burden of the proposed measures, ex-post evaluations suggest that the measures had virtually no effect on the average income of dairy farming and that a considerable number of dairy farms even improved their income (Westhoek et al. 2004).

The evaluated policy in the Netherlands was the MINAS policy, which had to be discontinued after it was judged to be an incorrect implementation of the Nitrates Directive. Whether a new manure policy in the Netherlands will yield the same efficiency gains remains to be seen (OECD, 2005).


5. Comparison of cost estimates across different Member States

In order to compare the cost estimates across differen Member States, Table 5.1 below presents ex-ante and ex-post estimates, converted to Euros in prices of the same year. Table 5.1 presents two sets of ex-ante estimates, one set of estimates from an EU-wide study (Andrews et al., 2000), and a set of estimates from national studies. We present estimates of total annual costs, the cost per hectare affected by the measures, and the cost per kg N reduction (= a measure of cost-effectiveness).

The ex-ante estimates of Anrews et al. (2000) are in line with national estimates from Denmark, Italy (pigs and poultry only), and the Netherlands, but are larger than the national estimates from France and the United Kingdom (although the latter is difficult to compare as Anrews et al. give an estimate for the United Kingdom and the national study refers to England only).

On an area basis, the (national) cost estimates range from € 6 to € 236 per hectare of the area affected.12 The variation between sectors is likely to be even greater, with the highest costs per ha in intensive livestock.production.

The ex-ante estimates of costs per kg N reduction range from a low of € 0.4.kg-1 in Croatia to a high of € 3.5.kg-1 in the Netherlands.

We found two ex-ante studies studies from new and candidate member states. A first observation to make is that there seems to be a fundamental uncertainty in these countries on how the Nitrates Directive might affect their agricultural sector. Some tentative estimates produce costs per hectare that do not differ substantially from those in some old EU Member States, such as France. A large uncertain factor in these countries is the number of hectares and farms that will be affected by the measures.

At the methodological, level we found a number of issues with the ex-ante studies:

• For a number of studies it is not exactly clear what measures are being evaluated and what measures are in the baseline;

• Some measures have multiple objectives (e.g., nitrate, ammonia, phosphorus and greenhouse gas reduction), so there is always some ambiguity as to what part of the costs should be allocated to what policy;

• The studies typically assume that the measures will have no impacts on the prices of agricultural outputs or inputs. They therefore assume that all net costs (excluding subsidies) of the measures should be borne by the farmers.

• Some studies have only evaluated a limited range of options available to farmers. Moreover, some studies did not estimate administrative costs and some studies did not exclude investment subsidies from the gross cost estimates.

12 Excluding the estimate for Italy as it only refers to pigs and poultry.

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• There is still little attention for potential costs (or cost savings) in the arable sector, as previously noted by Andrews et al. (2000).

• Some studies report environmental effects in terms of a change in leaching of N, while others report the effects in terms of a change in application of N to the land.

• Economic studies are sometimes not very precise in their assessment of the environmental effects of the evaluated measures, or do not report these effects at all, hence complicating an evaluation of the cost-effectiveness of measures.

• Some countries have no national estimates, so we had to rely on an uncertain extrapolation of regional estimates.

Table 5.1 Ex-ante estimates of costs of the Nitrates Directive and associated measures across European countries (€, prices of 20041)).

Andrews et al. National estimates € mio.y-1 €.ha-1 y-1 € mio.y-1 €.ha-1 y-1 € kgN-1

Denmark 63 90 72 103 2.7 Finland n.a. n.a. 67 n.a. France 78 104 20-46 25-61 1.2 Netherlands 215 155 326 236 3.5 United Kingdom 125 48 30 6 Lithuania n.a. n.a. 7-14 50-57 Croatia n.a. n.a. n.a. 43 0.4 1) Current prices are deflated with the Harmonised Consumer Price Index of Eurostat.

We found two ex-post studies that evaluated the costs of measures. Unfortunately, one of those ex-post estimates concerned an implementation of the Nitrates Directive by the Netherlands, which has been judged as inappropriate by the European Court of Justice.

We compare estimates of two different indicators of costs: costs per hectare and cost per kg N reduction (Table 5.2). For both indicators we find that the ex-ante estimate is at least as large as the ex-post estimate and usually larger. For the ‘cost-per-hectare’ indicator, the ex-ante estimate is between 1 and 1.7 times as large as the ex-post estimate. For the ‘cost-per-kgN’ indicator, the ex-ante estimate is between 1.2 and 1.9 times as large as the ex-post estimate.

Table 5.2 Comparison of ex-ante and ex-post estimates of the costs of N-reducing policies in Denmark and the Netherlands (€, prices of 20041)).

Ex-ante Ex-post Ratio Exante/ Expost costs

Ratio Exante/Expost cost-effect.

€.ha-1 y-1 €.kgN-1 €.ha-1 y-1 €.kgN-1 Denmark 103 2.7 62 1.4 1.7 1.9 Netherlands2) 174 2.0 174 1.7 1.0 1.2 1) Current prices are deflated with the Harmonised Consumer Price Index of Eurostat. 2) In the Netherlands the numbers refer to MINAS policy plus associated measures.


A deeper analysis of the differences between ex-ante and ex-post studies does reveal, however, that for some sectors in some countries (e.g., the dairy sector in the Netherlands), manure and fertiliser policies may result in efficiency gains due to a more rational fertiliser management that offset part of the expected costs. The extent of these efficiency gains will in general depend on the initial situation (how rational is the current situation) and the design of the policy instruments and associated advisory initiatives around these instruments.


6. Conclusions

We have reviewed a number of ex-ante and ex-post estimates of costs to farmers of measures to reduce nitrogen pollution in agriculture across Europe. We found a number of ex-ante studies at different regional levels (local, national, EU), for different sectors, and for different countries.

The estimated costs of the Nitrates Directive differ across Member States. We found a range of costs per hectare from € 6 to € 236. The differences are caused by differences in industry structure, livestock intensity, historical rates of fertiliser application, and the vulnerability of soils to nitrate leaching. Differences between Member States may also be due to different assumptions and other methodological differences. For Lithuania, for example, at the time of the cost assessment it was uncertain how many fams would be faced with mandotory measures. Assessment methodologies range from an estimate of levelised investments in manure storage facilities on the one hand (Lithuania), to an econometrically estimated yield loss because of reduced fertiliser gift (Croatia). A number of reports is rather vague on the exact estimation methodology used (e.g., United Kingdom) or their more detailed technical reports are difficult to access because of language reasons (France, Finland). On the basis of the present review it is impossible to relate the cost differences to differences in the application of more or less efficient policy instruments across Member States.

A comparison of ex-ante and ex-post cost estimates suggests that ex-ante cost estimates usually exceeded ex-post estimates by factors between 1.0 and 1.9. The sample of estimates is too small, however, to draw firm conclusions with respect to a possible ‘structural bias’. The comparison of ex-ante and ex-post estimates of the Netherlands suggested that the ex-ante estimate did not foresee the efficiency gains in the dairy sector that, through a more rational management of fertilisers, offset part of the ex-ante expected costs. It should be remembered, however, that these efficiency gains came about under the MINAS policy programme. This policy has been terminated. Whether the implementation of the new manure policy in the Netherlands would yield similar efficiency gains remains to be seen.


References

Andrews, K., Anderson, F.M., Bartonova, A., Horth, H., Kilde, N., Larsen, and H.V., Zabel, T. (2000). Study on investment and employment related to EU policy on air, water and waste. Final report Annex I: Best estimates on costs. Report No. EC 4739/A.1, European Commission, Directore-General Environment, Brussels.

Bel, F., Lacroix, A., Mollard, A., and Regairaz, E. (1999). Reduire la pollution azotée: les choix préalables d’une politique publique. Le Courier de l’environnement, No. 36, mars 1999.

Brouwer, F.M., Godeschalk, F.E., Hellegers, P.J.G.J., and Kelholt, H.J. (1995). Mineral balances at farm level in the European Union. LEI report No. 137, Agricultural Economics Research Institute (LEI-DLO), The Hague.

DEFRA (2002). Nitrates – reducing water pollution from agriculture. Regulatory Impact Assessment. UK Department for Environment, Food and Rural Affairs, London.

DEPA/DANCEE (2004). Transposition and implementation of the Nitrate Directive (Phase II). Annex to Draft Action Programme: Cost Assessment Report: Lithuania. Danish Environmental Protection Agency and Danish Cooperation for Environment in Eastern Europe. Copenhagen.

European Commission (2002). Implementation of Council Directive 91/676/EEC concerning the protection of waters against pollution caused by nitrates from agricultural sources. Synthesis from year 2000 Member States reports. Office for Official Publications of the European Communities, Luxembourg.

Eerdt, M.M. van, Grinsven, H. van, Willems, J., and Schotten, K. (2005a). A review of Dutch manure and fertiliser policy. In: Proceedings of the Third international Nitrogen conference, Nanjing, China, October 12-16, 2004 to be published in October 2005 by the China Science Press, CAS in New York and Beijing

Eerdt, M.M. van, Born G.J. van den, and Dam, J. van (2005b). Environmental costs and benefits of the Dutch manure policy 1998-2003 (in Dutch), Netherlands Environmental Assessment Agency, Bilthoven.

Grossman, M.R. (2000). Nitrates from agriculture in Europe: the EC Nitrates Directive and its implementation in England. Boston College Environmental Affairs Law Review, 27 (4): 567-680.

Helming, J.F.M. (1997). Mogelijke ontwikkelingen van landbouw en milieu bij een strenger milieubeleid voor de Nederlandse landbouw. Report No. 1.30, Agricultural Economics Research Institute (LEI-DLO), The Hague.

Hoop, D.W. de, and Stolwijk, H.J.J. (1999). Economische effecten van milieubeleidsvoornemens voor de landbouw voor 2002 en 2003. LEI/CPB report 2.99.12. Agricultural Economics Research Institute (LEI-DLO) and Netherlands Bureau for Economic Policy Analysis (CPB), The Hague.

Huhtala, A. (2005). Pers. comm. (17 October 2005). Jacobsen, B.H. (2002). Reducing nitrogen leaching in Denmark and the Netherlands –

administrative regulation and costs. Paper presented at the Xth EAAE Conference in Zaragoza, 2002. Zaragoza.

Jacobsen, B.H. (2004). Final economic evaluation of the Action Plan for the Aquatic Environment II (In Danish with English summary). Rapport No. 169, Fødevareøkonomisk Institut, Copenhagen.

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Kröger, L. (2005). Development of the Finnish agri-environmental policy as a learning process. European Environment, 15, 1: 13-26.

OECD (2005). Manure policy and MINAS: regulating nitrogen and phosphorus surpluses in agriculture in the Netherlands. COM/ENV/EPOC/CTPA/CFA(2004)67/FINAL, OECD, Paris. Olsthoorn, C.S.M., and Fong, N.P.K. (1998). The anthropogenic nitrogen cycle in the Netherlands. Nutrient cycling in Agroecosystems, 52: 269-276.

Roest, K. de, and Bonazzi, G. (2003). L’onere della salvaguardia dell’ambiente sulla redditività della suinicoltura italiana. Agribusiness Paesaggio & Ambiente, 6 (2): 150-153.

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Westhoek, H., Berg, R. van den, Hoop, W. de, Kamp, A. van der (2004). Economic and environmental effects of the manure policy in the Netherlands: synthesis of ex-post and ex-ante evaluation. Water Science and Technology, 49 (3): 109-116.

Internet resources: Danish Aquatic Programme II: http://www2.dmu.dk/1_Viden/2_Miljoe-tilstand/3_vand/4_eutrophication/Nutrient_reduction.asp Council Directive 91/676/EEC of 12 December 1991 concerning the protection of waters against

pollution caused by nitrates from agricultural sources. http://europa.eu.int/eur-lex/lex/LexUriServ/LexUriServ.do?uri=CELEX:31991L0676:EN:HTML

http://www2.dmu.dk/1_Viden/2_Miljoe-tilstand/3_vand/4_eutrophication/Nutrient_reduction.asp

http://europa.eu.int/eur-lex/lex/LexUriServ/LexUriServ.do?uri=CELEX:31991L0676:EN:HTML


Appendix I. Agricultural areas requiring measures to address a nitrogen surplus from manure production (1991).

Cereal Other crops

Dairy Beef Pigs and poultry

Mixed Total Total (%)

Austria n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Belgium 0 0 417,049 201,385 18,609 432,740 1,069,783 77 Denmark 0 0 549,270 0 148,520 0 697,790 26 Germany 0 0 0 0 77,703 0 77,703 1 Greece 0 0 18,428 243,348 1,097 0 262,872 9 Spain 0 0 844,682 0 158,749 0 1,003,431 4 Finland n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. France 0 0 0 0 225,878 529,468 755,346 3 Ireland 0 0 0 0 0 0 0 0 Italy 0 0 394,545 208,082 52,287 0 654,914 4 Luxembourg 0 0 0 0 0 0 0 0 Netherlands 0 0 1,046,762 85,495 42,495 158,095 1,382,848 71 Portugal 0 0 0 0 20,118 0 20,118 0 Sweden n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. United Kingdom

0 0 2,513,961 0 53,930 0 2,567,892 14

EU-15 0 0 5,784,697 738,310 799,387 1,120,303 8,988,029 Source: Brouwer et al., 1995

ex ante and ex post costs of the nitrates directive · ex ante and ex post costs of the nitrates...

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