Progress 09/01/08 to 08/31/11
Outputs
OUTPUTS: Two projects were funded by this grant. The first titled: "Ecosystem Based Approach to Developing, Simulating and Testing a Maryland Ecological Investment Corporation that Pays Forest Stewards to Provide Ecosystem Services" by Drs. Tilley, Campbell, Weber, May and Streb identified forests as providing a multitude of vital benefits to the ecosystems, economies and people of Maryland and noted that various financial mechanisms and land management programs have been developed by land trusts and state and federal agencies during the last few decades to increase the preservation and conservation of forests. However, the authors noted that it remained necessary to financially link the production and cocnsumption of ecosystem services. Stewards of forested land should be rewarded for producing ecosystem services and in return consumers of ecosystem services need to pay for consuming the services. Research conducted proposed that an Ecological Investment Corporation could be an additional tool for society to direct payments from consumers to land steards to encourage the production of ecosystem services and emergy synthesis was used to determine the value that forest ecosystem services provide to the state's public economy and a fair price that should be paid to land stewards for producing specific ecosystem services. Two approaches were explored for estimating the fair payment price for ecosystem services. The first used the dollar prices and emergy values of commodities such as gasoline, corn and wool since they were actively traded on market exchanges such as the Chicago Mercantile Exchange to estimate the price of emergy for natural resources. The second approach was more complex as it derived the price of emergy of ecosystem services based on existing situations where money was being exchanged for comparable ecosystem services. The second study: "least Cost Supply of Nitrogen Reduction from Two Important Agricultural Non-point Source Best Management Practices in Maryland" by Robert Wieland and Dr. Doug Parker described a practical way to target non-point source pollution mitigation so that a greater amount of pollution reduction was obtained per dollar spent. The research was based on the idea that adopters of pollution mitigation practices respond to price signals. By pricing nutrient pollution reduction by the pound, potential adopters are given more precise information about the value of adopting a specific practice on specific acres. The research focused on comparing a hypothetical "per pound reduced" pricing scheme with current pricing policies for the cover crop and riparian buffer best management practices. PARTICIPANTS: For the Ecological Investment Corporation project, partners came from the Department of Environmental Science and Technology of the University of Maryland, College Park; from The Conservation Fund in Annapolis, MD and from Biohabitats in Baltimore, MD. The results of this report will be shared with the Maryland Forest Service at the Department of Natural Resources and with the Department of Business and Economic Development. For the second project which was a partnership between Main Street Economics and the University of Maryland AREC in College Park, Md., presentations of this approach were made to the Chesapeake Bay Technical Workgroup, to the Scientific and Technical Advisory Committee, to the Board of the Center for Agro-Ecology, Inc.,to staff from the Maryland Department of Agriculture, to the Waterfowl Festival Funders Breakfast, the Maryland water Monitoring Council Conference, to the ACES Conference in Arizona, to the Bay Program Forestry Workgroup and while no one at this time has adopted the approach to better measure the nutrient reduction attained from cover crops, it is hoped that as the TMDL Phase II effort unfolds, that new ways of measuring will again be refoced upon. TARGET AUDIENCES: Nothing significant to report during this reporting period. PROJECT MODIFICATIONS: Not relevant to this project.
Impacts
In 2000 the state of Maryland consumed a total of 508,000 exajoules of solar energy, whihc produced a gross economic product base of $180 billion. The 1 million hectares of forest consumed $304 million of the renewable energy to produce $304 million of the rene4wable energy to produce $309 million of wood. The state harvested the equivalent of two thirds of that new wood growth as timber, whihc ultimately added #210 million to the state economy. In addition to producing timber the forests produced ecosystem services, whihc added at least $4.4 billion to the state economy. To ensure that forest land stewards continue to produce ecosystem services at this rate, they should receive compensation between $230 and $660 million. The lower estimate assumes that the value of ecosystem services is at least comparable to the market value of commodities with the higher estimate being hased on conversion of the emergy value of each individual ecosystem service. On a per capita basis, a resident of Maryland enjoys $830 worth of ecosystem services from the forest as public value without paying anything to the land steward. If all residents were to contribute to an Ecological Investment Corporation to generate between $230 and $660 million for land stewards, then each would need to pay between $43 and $124 annually. The research completed for this project is a major step toward realizing an Ecological Investment Corporation that can pay forest land stewards to produce ecosystem services and collect payments from consumers who want to encourage the production of these services. The second project concluded the following scenario: Under current practice in Maryland's cover crop program, premiums are paid to motivate desired practices. While this is more effrective than simply paying a fixed price per acre, within any priced class of practices and acres there will be higher reducing acres/practices and lower reducing acres/practices. Since the same price signal is going to adopters with either sort of acres, estimating load reductions from those priced classes requires taking an average of high reducing and low reducing acres. This makes it mathematically impossible for current policy to achieve as high a level of nutrient reduction at current spending levels as could be achieved by pricing nutrient pollution reduction by the pound.
Publications
- "Ecosystem Based Approach to Developing Simulating and Testing a Maryland Ecological Investment Corporation that Pays Forest Stewards to Provide Ecosystem Services" Tilley, Campbell, Weber, May and Streb 2011 (Draft Final Report under review.)
- "Least-Cost Supply of Nitrogen Reduction from Two Important Agricultural Non-point Source Best Management Practices in Maryland" Wieland, Robert and Doug Parker, PhD. Harry R. Huhges Center for Agro-Ecology, Inc., University of Maryland, Queenstown, MD. HCAE Pub 2010-05
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Progress 09/01/09 to 08/31/10
Outputs
OUTPUTS: There are two projects being funded with this grant. The first is titled: An Ecosystems-Based Approach in Developing, Simulating and Testing a Maryland Ecological Investment Corporation by Tilley, Campbell, Weber, May and Streb for which the following was accomplished: 1) the average carbon storage and sequestration on the forest lands of MD was estimated based on field data collected the past summer at 6 sites around the state (4 state forests, 2 suburban sites). Results for biomass per acre were also obtained. 2) a model of hydrologic ecosystem services from the USFS lands was developed (SoilAqDyn) which simulated the flow of emergy associated with the nydrology of the landscape; 3) a state emergy evaluation for MD was completed for the year 2000 and is being updated to 2007 which is the most recent year that a complete data set is aqvailable. 4) the remaining ecosystem services will be modeled (e.g. soil erosion prevention/soil genesis, biodiversity protection, air pollutant removal) and will be determined by the end of 2010. The model was presented at the 6th Biennial Emergy Conference in Gainsville, FL in the form of a scientific poster. This was awarded second prize in a field of international scholars and a paper summarizing the results will be published in the proceedings of the conference. The second report is titled: Least-Cost Supply of Nitrogen Reduction from Two Important Agricultural Non-point Source Best Management Practices in Maryland by Robert Wieland, Doug Parker, Will Gans and Jessica Rigelman. A final report was completed in spring 2010 and the results were shared with the Governor's BayStat Advisory Committee as well as with other groups. PARTICIPANTS: Participants for the first project include: The Conservation Fund, Biohabitats, Inc., USEPA Office of Research and Development, National Health and Environmental Effects Research Lab our of Narragansett, Rhode Island and USEPA Region 4, Enterprise Architecture and Integrated Analysis out of Atlanta, Georgia, forest land owners, private land trusts and state agencies who are being asked to provide feedback on the concept and mechanics of implementation. Participants for the second project have included Main Street Economics and the University of Maryland's Department of Agricultural and Resource Economics at College Park. The results have been shared and are being shared with policy makers (Scientific Advisory Committee to the Bay Program and to BayStat Advisory Council for Governor O'Malley. TARGET AUDIENCES: For the first project: forest landowners, the forest industry, local governments, state agencies. For the second project: policy makers and managers who have an impact on nturietn reduction decisions affecting the Bay. PROJECT MODIFICATIONS: None to report.
Impacts
For the first project, which is developing a models(s) of the individual ecosystem services being provided in Maryland; it is anticipated that an Ecological Investment Corporation will be created so that land stewards will have a financial incentive to produce ecosystem services for the forsts that they retain, while non-land holding urban and suburban populations are given a means to reinforce their provision from a fiscal perspective. Such a Corporation could add to the currently limited funding mechanisms now available to state and local governments to preserve open space and conserve natural resources. Findings to date have already shown that state forests sequester signifcantly more carbon per acre than the suburban areas and that state forests with hardwood dominant species sequestered more carbon than state forests with softwood dominant species. The model results also have shown that water is retained on forest lands for a lonter period than suburban lands, where runoff was approximately 50% greater in the suburban setting. This difference is the ecosystem service of runoff prevention provided by the forest. The model also demonstrated the ability of forests to promote groundwater recharge which was 22% greater on forest lands. As the data are analyzed, additional findings will be able to be posted. The second project which was completed and for which a report has just been finalized addressed the economic supply of expected nutrient load reductions from two non-point source nutrient pollution load reduction practices: cover crops and riparian buffers. For both BMPs price-quantity relationships were measured in acres vs. pounds of nutrients reduced and the results were compared to the pricing of BMP implemnetation. The result was that nutrient reductions were significantly greater at relevant levels of expenditure when they were bought by the pound as compared to buying them by the acre. Expected load reductions from BMPs under current policy are found by averaging high reducing acres and low reducing acres within any priced class of BMP implementation. This is expected because there is no difference in the price signal going to either sort of acre. Without additional information, the best estimate for load reductions from "per acre" supply is the weighted average of high reducing and low reducing acres. Load reductions under a "price per pound reduced" policy are estimated differently. Pricing load reductions by the pound sends a more compelling signal to high reducing acres to adopt (with high reducing practices), and they are expected to do so. Low reducing acres (with low reducing practices) would be paid less under such a policy, so, depending upon their costs and the price per pound, potential suppliers may choose not to adopt. Becuase of those types of decisions, total load reductions are expected to be greater at any unit price than they would be at a similar average cost under a fixed per acre policy.
Publications
- Wieland,R., Parker, D., Gans, W., Rigelman, J. 2010. Lease-cost Supply of Nitrogen Reduction from Two Important Agricultural Non-Point Source Best Management Practices in Maryland. Hughes Center for Agro-Ecology, Inc., Wye Research and Education Center, College of Agriculture and Natural Resources, Queenstown, MD
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Progress 09/01/08 to 08/31/09
Outputs
OUTPUTS: This is the first year report for two projects. Project 1: "An Ecosystem-based Approach to Developing, Simulating and Testing a Maryland Ecological Investment Corporation that Pays Forest Stewards to Provide Ecosystem Services". The first research team meeting was held in 2008 with attention being given to sub-system forest models including air pollutant detoxification, nutrient uptake and other biogeochemical cycles, provision of biological diversity, soil erosion control and generation and physical amelioration of urban heat and storm flow. Field sites and data collection were also discussed as well as expectations and deliverables. A preliminary version of the Ecological Investment Corporation (EIC) model was formulated using computer modeling program Stella. The model exercise provided the team with where they should focus their data gathering. The model suggested that the public could make relatively small payments to the EIC that could have a significant effect on the provision of ecosystem services from forested land. Collection of data from Maryland forests via field sampling is underway to improve the calibration and an emergy evaluation is also being completed in conjunction with U.S. EPA. A total of 11 forest sites is being used. Project 2: "Implications of Nutrient Pollution Loading Caps for Load Sources in Maryland" is also progressing. Data on load reductions have been compiled, gathering and organizing of BMP cost data has taken place, examining sector or industry specific enterprise budgets or cost functions is occurring as is collating federal, state and local funding for BMP implementation, considering planned and prospective public funding and deciding on the specificity with which industry cost functions will be addressed. The project is beneficiary of additional research undertaken by the study team to cost a range of non-point source BMPs. That research was reported to the Maryland Department of Natural Resources as "Costs and Cost Efficiencies for Some Nutrient Reduction Practices in Maryland" in May 2009. For the current study, the team has gathered and is collating input-output data from Version 4.3 of the Chesapeake Bay Model with particular regard to loading rates, BMP implementation, land use change and load reductions. The team had considered attempting to do a computable general equilibrium model to assess the full economic impacts of the implied costs of "adequate" BMP implementation however because the data would be too coarse at the county level from an accuracy perspective, the team decided to pursue a more accurate tracking of BMP implementation costs, and to assess those relative to value added by the various source sectors. PARTICIPANTS: Other participants for Project 1 include The Conservation Fund, Biohabitats, Inc., US EPA Office of Reseearch and Development, National Health and Environmental Effects Research Lab out of Narragansett, Rhode Island and USEPA Region 4, Enterprise Architecture and Integrated Analysis out of Atlanta,Georgia. Future participants will include forest land owners, private land trusts and state agencies who will be asked to provide feedback on the concept and mechanics of implementation. Participants for Project 2 include Main Street Economics and the Unviersity of Maryland's Department of Agricultural and REsource Economics. The results will be shared with policy makers and managers. TARGET AUDIENCES: Project 1: Forest landowners, the forst industry, local governments, State agencies. Project 2: policy makers and managers who have an impact on nutrient reduction decisions affecting the Bay. PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
Project 1: The intent is to develop a dynamic mathematical model of a novel Ecological Investment Corporation that pays forest stewards, both public and private, to provide ecosystem services to the general public and to collect revenue from consumers of the ecosystem services based on their consumption of ecosystem services embodied in consumer goods. This will create a win-win situation if applied because land stewards will have a financial incentive to produce ecosystem services, while non-land holding urban and suburban populations will be given a means to reinforce their provision. This Corporation will add to the currently limited funding mechanisms now available to state and local governments to preserve open space and conserve natural resources. Project 2: The intent is to find out who bears the cost of implementing BMPs in a watershed and how much can they afford and what happens when the various sectors pass those costs onto others and whether they will need to be funded through additional support from government in order to attain improvement to the Bay. Results from the study could very well have an affect on the effeictveness of what is put into place to reduce nutrient input into various parts of the Bay and could provide decision makers with an understanding of what they will need to do to make a difference to the Bay and its tributaries.
Publications
- No publications reported this period
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