Deliverable 6.13

Abstract: Cost effectiveness analysis report for the Louros catchment including analysis of disproportionality

This report examines the cost effectiveness and disproportionality effects of applying nitrogen and phosphorous reducing mitigation measures at the Louros catchment in Greece. The three lagoons formed at the Louros estuaries have, for a long time, been assumed to suffer from nitrification due to agriculture. Sporadic and fragmented monitoring activities undertaken by the Ministry of Rural Development and Food or by independent researchers failed to reveal any significant, persistent and consistent nitrification or phosphates pollution issues. However, at certain monitoring points and some pollution spikes were observed. In 2006, the Ministry of Rural Development and Food announced a nitrification control programme for the Arta-Preveza plain but following the 2008/09 recession the programme was abandoned. 

The mitigation measures proposed for this study imitate the measures originally included the agri-environmental programme for Louros with two differences. First, we included cultivation of medic and citrus fruit that could result ion potentially serious polluting activities. Second, we assumed different levels of abatement under two different production processes, i) allowing for reductions in fertilizer applicationand ii) allowing for equal levels of reductions in fertilizers but requiring 5% set aside margins. The cost of measures was estimated for a “typical – average” farm using aggregate FADN-RICA accounting and production data informed by a widespread consultation process with all relevant stakeholders. 

In parallel, likely land use changes induced by climate change were highlighted from an assessment carried out by the Central bank of Greece under the supervision of the Academy of Athens. Following the IPCC story lines, four climate change scenarios were devised. For each climate change scenario the future costs for applying the mitigation measures were re-estimated. Thus, we ended up with the cost of reducing nitrogen and phosphorous under climate change estimated as cost per Kg of the reduced nutrient and as cost per hectare of land under each mitigation measure and cultivation. These were again aggregated to the whole Louros catchment taking into account the distribution of cultivations in the catchment under climate change induced land use changes.

Modelling of nutrients and sediment transport provided a baseline (calibrated) estimate of nutrient concentrations without any mitigation measures or land use and climate change. This showed that the water quality of the Louros catchment was in good environmental. Thus, there no need to apply a catchment wide agri-environmental programme on the basis of non-point source pollution from agricultural activity. Modelling also produced simulated concentrations for nutrients under the mitigation measures and without any land use and climate change. These simulations showed that the application of mitigation measures marginally improve the water quality. The baseline scenario (i.e., no mitigation measures) also was simulated for climate change induced land use changes. Due to the complexity and the burden of estimations for all alternative combinations of climate change and mitigation measures models, only the baseline, best and worst scenarios are presented. Climate change increases nutrient concentrations but not as much as it would have been expected from foreseen land use changes. This is due to the fact that climate change, and especially expected higher temperatures, lower precipitation and decrease runoff, reduce sediment and nutrient transport and increase the use of nutrients by plants. Thus, the quality of water at Louros remains, under any environmental threshold levels, at good status. When mitigation measures are applied to the climate change baseline scenario, the reduction in nutrient concentration is marginal for nitrogen and more significant (but still low) for phosphorous. 

Despite the fact that the water quality in Louros is at good status under all environmental thresholds and all alternative simulations, we decided to run the cost effectiveness analysis (CEA) and disproportionality analysis (DA) exercises assuming that the agri-environmental policy would have been applied, if recession had not occurred. So, instead of searching for the most cost effective solution we could search for the least ineffective solution.


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