Valuing the environmental benefits of reduced acid deposition in the semi-natural environment

Abstract

Acid deposition is a present and future cause of environmental damage in vulnerable areas of Scotland important for nature conservation and salmon fishing. The UK government, in cooperation with other European states, has agreed to substantial reductions in emissions of SO2, the primary cause of acidification. Although the cost of abatement will be extremely high little effort has been made to value the environmental benefits of ecosystem recovery. This partly reflects the difficulties involved in establishing reliable dose-response functions that can predict long-term ecological change for acidified ecosystems, but also the problem of providing a monetary estimate for biodiversity losses which have no market value. This study aims to generate reliable estimates of the future economic benefits generated by recovery from acidification in the seminatural environment of Scotland. The Contingent Valuation Method is applied to value the non-use benefits of abatement under a range of acidification scenarios. Average household willingness to pay (WTP) was £247 and £351 per year when faced with low and high damage , with a present value in excess of £9 and £13 billion respectively. WTP was not influenced by future recovery level or rate or recovery. When faced with risky outcomes respondents were found to be risk averse when both environmental gains and losses are considered. A hedonic price model, which links market data to changes in water chemistry and fish populations predicted by the MAGIC model, was used to estimate the economic benefits to the rod and line salmon fishery. The present value of the benefits to the Scottish salmon fishery were estimated to be £3.7 million. Non-use benefits associated with recovery from acidification therefore greatly outweigh user benefits but may be prone to hypothetical bias. Further research into scope effects in CVM studies is required, and the potential to calibrate CVM responses in line with real economic commitments should be investigated.