Grant for Nutrients Benefits Valuation

Valuing Reductions in Surface Water Nutrient Pollution

Overview

States’ freshwater nutrient pollution management objectives often involve setting ambient numeric criteria for parameters such as total nitrogen and chlorophyll a. Judging the appropri-ateness of a particular criterion involves measuring its monetary costs and benefits. While costs are often known, accessible tools for benefits assessment have historically been unavailable to state analysts.

In 2007, the Environmental Protection Agency selected North Carolina State University (NCSU) to receive a grant of $423,841 to conduct a project that will improve the application of empirical methodologies to the economic valuation of the benefits from reducing nutrient levels in the nation’s water bodies. The goal of this grant was to aid States in their attempts to estimate monetary benefits associated with nutrient reductions as they strive to adopt numeric nutrient criteria into their State water quality standards.

For more information on the 2011/2012 Request for Proposals (RFP)

Approach of the Project

The approach used in the project can be summarized as follows. First, NCSU used expert elicitation (structured interviews with lake water quality experts) to generate data to estimate functions mapping objec-tively measured nutrient parameters - e.g. total nitrogen, chlorophyll a - to qualitative descriptions of lake water quality that were meaningful to potential users. Second, survey data from residents of Southeastern states was used to estimate a function that maps changes in water quality to economic values related to improved recreation possibilities. Third, the models were constructed at common temporal and spatial scales and designed so that the outputs from the water quality models could serve as input to the economic model.

Taken as a whole the project provides the ability to (a) estimate how an improvement in water quality meas-ured via a change in ambient pollution maps to a change in qualitative descriptions of lake water quality, and (b) examine how the change in qualitative quality maps to a per recreation visit dollar value of the change. This can be aggregated to an annual value ('willingness to pay' by lake users) using estimates of the total trips made to the quality-improved lake.

Results of the Grant (coming soon)

EPA Contacts

For more information about this grant, please contact Julie Hewitt at 202-566-1031 or hewitt.julie@epa.gov.