Mussel production to utilize excess nutrient in fjords is it cost-effective as mitigation measure? measure?

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1 JANUARY 14, 2013 Mussel production to utilize excess nutrient in fjords is it cost-effective as mitigation measure? measure? Berit Hasler, Marianne Zandersen, Hans Frost, Jens Erik Ørum, Jens Kjerulf Petersen, Karen Timmerman, Ditte Tørring, Marianne Holmer, Pernille Nielsen, Martin Mørk Larsen UNI VERSITET

2 Content Mussel farming as mitigation measure Cost-effectiveness and potentials Payment for ecosystem services Payment for ecosystenm services musssel production annd nitrogen uptake Berit Hasler August 27,

3 The project The project MUMIHUS is financed by the Strategic Research Council A full scale mussel farm has been set up in Skive fjord Costs, effects on production, nutrient uptake and filtering of nutrient have been studied and monitored A mix of empirical and modelling data used and produced A cross disciplinary study Results described in DCE report for the Ministry of Payment for ecosystenm services musssel production annd nitrogen uptake August 27, 2013 Environment in 2013 Berit Hasler 3

4 Why mussel farming as mitigation measure? Costs of agricultural measures (Jacobsen, 2013): 9000 tons N : Marginal costs 40 DKK/kg N additional tons N: Marginal costs DKK/kg N The capacity of agricultural and waste water treatment measures restricted; hard to find new measures, 4

5 Mussel production as nutrient regulation and filter 5

6 Mussel farming and nutrient management The idea is that mussel farming enterprises can be paid for the environmental service they provide The ecosystem service is regulating nutrients, by return of nutrients from sea back to land when harvested. 6

7 Principles, the provision ogf the ecosystem service Settle substrate - Bands, ropes, nets and bouys - no seeds, larvae or spat, no fertilizer or feed. The blue mussels food intake is the same for wild or farmed. One kg of live mussels can return g of nitrogen (N), g of phosphorous (P) and about g of carbon (C) from sea to land when harvested (Lutz, 1980; Petersen and Loo, 2004; Lindahl 2007; Petersen et al 2013) 7

8 Mussel farming principles - Separate farms in fjords or - Filters connected to aquaculture, e.g salmon farms 8

9 Risks connected to mussel farming as mitigation measure Cold winters,ice and ice drift - disturbance, loss of settled mussels, damage and loss of farming equipment. Can be minimised by management practices. Algae and pollutants, contaminants risk can be reduced by treating the product after harvest (not for human consumption) Risk management increase the costs 9

10 Case study Skive fjord a heavily eutrophicated estuary

11 Cost estimates from mussel farm, Skive fjord Investment costs: long lines, buoys, anchors, boats: 43738/year. Labour costs construction 1928/year. Operation and maintenance costs: /year. DKK per kg N: Sale of mussel meal can more than half the costs (1 DKK/kg fodder) Harvest autumn (900 tones) Harvest spring (1100 tones) Welfare economic cost, Boats hired Cost per kg N Boats hired Welfare economic cost,. Boats bought Cost per kg N Boats bought

12 For comparison: Conventional mussel farming, results, (for human consumption): Production, Tons/year Profit 1000 DKK Est. Dkk/kg N Large variations in production but also sales prices influences profits, and price / kg N uptake. Dependence on sales prices = uncertain delivery of ecosystem service. 12

13 Cost-effectiveness, comparison with other studies Study Results DK: Möhlenberg 2007 SE: Hart (2003) SE: Lindahl & Kollberg SE: Lindqvist (2007) DK: Our results, MUMIHUS, Skive fjord 261 kr/kg N low productivity, assumed sale price 1.5 kr/kg mussels Assumed costs 2-4 kr/kg N Claims cost-effectiveness, but no estimations 0,75 3,5 kr/kg N, cost-effectiveness between 0 38 kr/kg N; between 14 and 89 kr/kg N in open sea. If no sale costs rise to kr/kg N kr/kg N, no sale 13

14 Max capacity, mussel production Limfjorden: t N Roskilde Fjord: t N Gamborg Fjord: t N Vejle fjord: t N Mariager fjord: t N Kolding fjord: t N Augustenborg fjord: t N Åbenrå fjord: t N Flensborg Fjord: t N The capacity has been estimated using data on salinity, depth (>5 m) and chlorophyll content (Petersen et al 2013). 14

15 Capacity, continued The capacity is estimated upon biological factors. Competing uses for boat transport, recreational uses, fisheries, biodiversity/nature protection etc. - not calculated /included. Byoys in surface! 15

16 Management models Direct payments from principal (municipality, the state) to agents (mussel farmers) By water quality trading, offsets, auctions 16

17 Ongoing work We apply a cost minimisation model for Limfjorden to analyse the cost-effectiveness of mussel production for different water quality objectives We apply an agricultural optimisation model to analyse the incentives for farmers to buy Emission Reduction Units /Permits We analyse the payment schemes and incentives the risks and transaction costs as advice on how PES and trade might work 17

18 Conclusions and status Cost-effectiveness of mussel production promising Payments from the state/municipality to mussel farmers can be justified because of ES, and will secure continuity of the ES provision Risk important to handle Farmers at low retention land will have incentives to buy Emission reduction permits The state/municipality should be involved in agreements, control necessary 18