Deliverable 6.12

Abstract: Cost-effectiveness analysis report for the Thame sub-catchment including analysis of disproportionality

The REFRESH project aims to help design cost-effective adaptation and mitigation strategies for freshwaters to comply with the Water Framework (WFD) and Habitats Directives (HD). Task 6.4 is at the core of the project and is specifically concerned with undertaking the Cost-Effective Analysis (CEA) of remediating strategies to achieve compliance. This report  is concerned with assessing the (dis)proportionality of compliance costs and exploring the differences in the behaviour and views of different land and water management actors within the Thame sub-catchment, in the north-eastern part of the Thames Basin (United Kingdom).
The analysis focuses on phosphorous (P) reduction from agriculture (arable and livestock) and sewage treatment works, which has been identified as the main pressures affecting compliance with WFD and HD targets in the sub-catchment. Results indicate that the most cost-effective combination of measures to tackle P pollution includes establishing ten metre width riparian buffer strips, 20 % P fertilizer reduction across all crop land, adoption of minimum tillage systems (over 50% of combinable crops), and establishment and maintenance of constructed wetlands and winter cover crops. Costs of implementation of these measures (including foregone benefits from agriculture) are outweighed by significant non-market benefits identified through existing stated preferences data, suggesting that the improvement of water quality can be achieved in a proportionate way from an economic viewpoint. Local stakeholders consulted throughout the project share this vision of proportionality, but acknowledge that a significant burden is placed upon farmers, while it is the public more generally who benefits from improved water quality. To address these distributional effects, it would be necessary to widen the decision criterion beyond purely cost-effectiveness, stimulating compensation mechanisms, increasing environmental regulation flexibility and awareness raising.
It should be noted that, as REFRESH is primarily a research project, this represents foremost a methodological exercise that explores and provide analytical resources adapted to a wide range of socio-ecological conditions, as well as analytical capacities. In this respect, the analysis of the Thame sub-catchment has used existing effectiveness data (rather than modelling results) for the cost-optimization in the Cost-Effectiveness Analysis. The economic analysis has been accompanied by an in-depth and sustained engagement process with local stakeholders, whose input has fed into the design of the analysis (e.g. by selecting the measures to be modeled) and also offers a way of contrasting scientific prescriptions with local perceptions. The result is step forwards towards a co-constructed understanding of how water quality problems can be addressed at the sub-catchment level in an economically efficient and more socially acceptable way.

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