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Andersson, Emma and Wall, Anna (2009) Restriktioner av växthusgasemissioner. Other thesis, SLU.

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Abstract

The agricultural sector accounts for about 13 percent of the total load of greenhouse gas emissions from Sweden (Swedish Environmental Protection Agency, 2007). The Swedish objective to reduce the greenhouse gas emissions with 40 percentage units to the year of 2020, based upon the year of 1990, might imply stricter regulations for Swedish farmers. A regulation or other forms of economic incentives is probably necessary to reduce the emissions originating from the agricultural sector. This study aims to investigate the economic and managerial impact on two agricultural firms with differing production system given that a constraint on green house gas emissions is introduced. Gases included in this study are carbon dioxide, methane and nitrous oxide. A literature review is carried out to obtain data on emission factors from agricultural activities. The two case-study farms in this study represent crop production and crop and pig production, respectively. The farms are both part of the research program "Odling i balans". In order to ensure an economic optimal adjustment, given the introduction of a constraint on greenhouse gas emissions, non-linear optimization techniques have been utilized. Furthermore, this study connects biological relationships and economic analyses of profits and cost-effectiveness with a target on emissions. Novel biological relationships in the study represent optimal crop rotation accounting for the biological effects of preceding crops, relationships between nitrogen application, yield and important quality parameters such as protein content in grain. Since the reduction of greenhouse gas emissions is not determined in quantity or formation, the results are presented according to two different scenarios, one life-cycle approach including emissions from production of inputs and one national perspective excluding these emissions. The results of the study show that the economic consequences for the crop producing farm due to a reduction of greenhouse gas emissions with 20 percentage units amount to 130 and 230 SEK per hectare, depending on whether the emissions from production of inputs are included or not. The corresponding result for the crop and pig producing farm, given the use of the available capacity for piglet production, amounts to 800 and 900 SEK per hectare. If the farmer is able to adjust the number of sows, the economic loss per hectare decreases to 280 and 340 SEK. Due to large emissions from the pig production, the cost of reducing the greenhouse gas emissions increases in a scenario with maximal capacity utilization in pig production. The explanation is that the reduction on total emissions requires extensive adjustments in the crop production. Hence, the economic return decreases. The reduction in percentage is greater when excluding emissions from production of inputs therefore the economic impact is greater. The marginal cost of reducing greenhouse gas emissions amounts to about 0,50 to 3 SEK per kg of carbon dioxide equivalent. A comparison between tillage systems reveals that minimum tillage systems, generate not only higher economic return but, also lower emissions. However the marginal cost remains largely unchanged. The results of the analysis show that the crop producing farm is able to reduce the greenhouse gas emissions with almost 35 to 40 percent through a minimum tillage system adhering to the emission constraint, and at the same time maintain the economic result. The corresponding reduction for the crop and pig producing farm is 9 to 14 percent.

Item Type: Thesis (Other)
Keywords: Växthusgasemissioner, koldioxid, kväve, metan, lustgas, lantbruk, ekonomi, vinstmaximering, kostnadseffektivitet, programmering, modell, icke-linjär optimering
Subject (faculty): Faculty of Natural Resources and Agricultural Sciences > Dept. of Economics
Divisions: SLU > Faculty of Natural Resources and Agricultural Sciences
Depositing User: Emma Andersson
Date Deposited: 13 Aug 2009
Last Modified: 18 Aug 2015 10:15
URI: http://ex-epsilon.slu.se/id/eprint/3344

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