Spitting In The Ocean
Putting our money where our science is
Here’s an idea for lowering
nutrient pollution loads to the Chesapeake Bay. Let’s adopt
a policy to use what we know to obtain the most nutrient pollution reduction
possible (for our available budget). Everyone agrees that this
is a good idea, I think. Some might wonder why we aren’t already
doing it. But, it is not as easy as it sounds.
To get the most nutrient pollution
reduction we can, we need to know where the nutrients are coming from.
Then, we need to figure out the efficacy of mitigation practices for
reducing loads and their unit cost. We have to select nutrient reduction
practices according to their costs because we want to get as much nutrient
reduction as we can for some available budget. We can only do
that if we spend our money on the cheapest reductions first and then
pick the more expensive practices as the cheaper ones are exhausted
and as our available budget increases. The metric here is dollars
spent per pound of nutrient reduced ($/lb).
So, it is already sounding
a little complicated. Especially when we consider that there are
so many disparate nutrient load sources across such a very large drainage.
Moreover, there is a range of potential mitigation practices for each
of those load sources. Do we have to figure out how many pounds
of nutrients are coming from each acre in the drainage and then assign
each of them a set of practices that we know will reduce their pollution
loads in the most cost-efficient manner? That would be very complicated.
Maybe there is an easier way.
Suppose we said that, for some
given nutrient pollution mitigation practice, a pound of reduction is
worth some fixed price. Let’s use as an example cover crops
and let’s say a pound of nutrient reduction from cover crops is worth
$3.50. Then, for any given acre, we just need to know how many
pounds of nutrients are reduced when cover crops are planted there.
Multiply that number times $3.50 and that is how much a farmer would
be paid to implement the practice on that acre.
By using what is known about
nutrient loads of different cropping systems and the reduction efficiencies
of specific planting practices, it is possible to create a matrix that
describes the number of pounds of nutrient load reduced for any combination
of practices and cropping systems. By multiplying any of those
factors times our fixed price ($3.50/lb), we would know the value of
that acre is in terms of nutrient reduction.
Placing a price on the thing
that we want (nutrient load reduction), instead of an imprecise proxy
for the thing that we want (acres), would motivate greater nutrient
load reduction for the same budget. Farmers would choose the practices
that maximized nutrient load reduction on their fields because that
would maximize their cover crop income from those acres. And,
farmers with acres that are not greatly affected by the planting of
cover crops – whose reductions are very low – would not bother.
The existing payments system
does not provide that sort of information to the farmer. Currently,
farmers are paid for cover crops by the acre, with premiums for planting
early and for planting on acres in specific cropping systems.
But, how do you price the premium? And, cover crop $/lb cost efficiencies
vary across more than just cropping systems and time of planting, though
those are important. Why not use all the information at our disposal?
Just as aggregators prefer
to buy wheat by the ton and not by the acre, we should prefer buying
nutrient load reduction by the pound. This approach could also
be used (with adjustments) to motivate more cost efficient nutrient
load reductions on riparian buffers, though those have different characteristics
than cover crops. It could also work for mitigating impervious
surface effects of developed land, if adequate standards were adopted
for loads from that source.
Pricing nutrient load reduction
by the pound provides the added benefit of giving one a better idea
of the total volume of nutrient load reductions achieved in any spending
period. Total load reduction would be total spending divided by
the price per pound. It would make tracking load reductions much
simpler, and more precise.
So, with regard to the new and improved Chesapeake Bay restoration arrangements, what would it take to make this happen?