WP7: Economic feasibility and value of mussel mitigating cultures

Objectives

  • To calculate value of mussel farming in a cost effectiveness approach.
  • To evaluate policy instruments promoting mussel farming by payment of ecosystem services.
  • To analyse the potential of ecosystem services by improved water clarity.

Tasks


Analysis of the cost effectiveness of mussel farming

Cost effectiveness analysis of water quality improvement has a long tradition in economics. The inclusion of mussel farming is relatively recent, and points out the importance of mussel sales price for the cost advantages compared with other nutrient mitigation measures such as changed agricultural practices or improved sewage cleaning. WP7 will therefore analyse the determination and development of prices of fish feed. No earlier study considers uncertaintyin nutrient cleaning by mussel farming, which is carried out in this task. We then make use of chance constrained programming when calculating cost effectiveness performance, consider a long term perspective, and carry out scenario analysis with respect to different economic development paths, demographic and climate change.

Explore policy alternatives to materialize the values of mussel farming

There are several alternative policies for payments of ecosystem services (PES), which include direct compensation payments, procurement, auctions, inclusion in pollutant trading markets, and nutrient cleaning as offsets for compliant firms. Irrespective of policy choice, a main difficulty is to ensure a certain level of nutrient cleaning under conditions of uncertainty because of stochastic weather conditions. A common approach is then to use so-called uncertainty discount where the value of a unit nutrient cleaning by mussel farming is lower than that by, e.g., a sewage treatment plant.

Based on the calculations of costs and analysis of feed prices in previous task, this task will carry out a systematic analysis and comparison of different policies for payments of nutrient cleaning by mussel farming. This will be made at the local scale and at the international level for reaching the targets determined in the Baltic Sea Action Plan. The numerical dynamic chance constrained model constructed under the previous task will be used for the calculations on total costs and profits for mussel farms under different policies.

Analysis of socio-economic potentials of improved water transparency

Increased water transparency can boost the regional development of a coastal area or at least for some municipalities (e.g. by improved bathing water quality or raised biodiversity). Beside the pure private economic assessment of a mussel farm, it is therefore necessary to make a consistent assessment of ecosystem services related to a mussel farm as mitigation measure, including social, economic and ecologic aspects (e.g. number of tourists or beach closures, fishing yields, bathing water quality derived from E. coli concentration).

Within BONUS-BaltCoast a suitable Ecosystem Service (ESS)-tool for this assessment is developed and tested. To allow a broader comparison between the different coastal systems from BONUS-BaltCoast and BONUS OPTIMUS, this tool will be further generalized and additionally applied to the German and Danish case study sites. In the end, the results regarding the changes in the ecosystem services will be evaluated by applying the INVEST-model (http://www.naturalcapitalproject.org/invest/).

Partners involved

  • Swedish University of Agricultural Sciences
  • Aarhus University 
  • Leibniz Institute for Baltic Sea Research
  • Coastal Union Germany

 

 

WP7 lead

Ing-Marie Gren
Swedish University of Agricultural Sciences
Find contact information

http://www.bonus-optimus.eu/about/work-packages/wp7
23 MARCH 2019