06 Jul, 2016
Total Economic Value of Improving Water Quality by Reducing Nutrients in Lakes
It is generally accepted that there is a cost to the natural environment and general aesthetics of lakes around the world due to nutrient pollution. However, recently economists have married the ecological data and economics to determine the Total Economic Value (TEV) of improving water quality by reducing nutrients in lakes.
The Total Economic Value (TEV) combines the financial, commercial, environmental and social value of a lake both in the present and in the future. It ensures that all components of value are given recognition when assessing the potential value of a lake and considers a larger picture view of the asset, not just its consumptive use. However where environmental assets differ from other financial assets is their complexity and variability.
The value of a water body could be assessed to include: recreational value, quality of life, value of property near the lake, water treatment savings if the water is used for drinking water (industrial and agricultural users saving money if the water is of good quality when entering their systems). Costs may be composed of waste water treatment upgrades (due to algal blockages, taste and odour issues), cost to industry and agriculture dischargers, stormwater management, non-point source pollution, regulatory administration.
An example of TEV in action was displayed recently by the Utah Division of Water Quality (DWQ). Due to the large cost of regulating nutrients in the environment, the U.S Environmental Protection Agency has recently required US states to develop nutrient criteria regulations in order to reduce nutrients in lakes. Utah residents were mailed a survey asking them to rate the importance of water quality related issues and determine if they would pay to prevent deterioration of the water quality of their lakes. Results of the survey showed that Utah’s water “users” group were willing to pay up to $13.63/month to prevent the deterioration of water quality and up to $32/month to improve water in areas that have already been or are expected to be degraded by excess nutrients.
The inclusion of economics into environmental issues may assist policy makers in determining the true cost of nutrient pollution and find methods, such as the use of Phoslock, to efficiently and cost effectively reduce nutrients in aquatic environments.