The social costs of nitrogen

Abstract

Despite growing recognition of the negative externalities associated with reactive nitrogen (N), the damage costs of N to air, water, and climate remain largely unquantified. We propose a comprehensive approach for estimating the social cost of nitrogen (SCN), defined as the present value of the monetary damages caused by an incremental increase in N. This framework advances N accounting by considering how each form of N causes damages at specific locations as it cascades through the environment. We apply the approach to an empirical example that estimates the SCN for N applied as fertilizer. We track impacts of N through its transformation into atmospheric and aquatic pools and estimate the distribution of associated costs to affected populations. Our results confirm that there is no uniform SCN. Instead, changes in N management will result in different N-related costs depending on where N moves and the location, vulnerability, and preferences of populations affected by N. For example, we found that the SCN per kilogram of N fertilizer applied in Minnesota ranges over several orders of magnitude, from less than $0.001/kg N to greater than $10/kg N, illustrating the importance of considering the site, the form of N, and end points of interest rather than assuming a uniform cost for damages. Our approach for estimating the SCN demonstrates the potential of integrated biophysical and economic models to illuminate the costs and benefits of N and inform more strategic and efficient N management. 2016