Expert Interview- Economics of Water Pollution

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Expert Interview- Economics of Water Pollution

Mark Eiswerth is a specialist in environmental and natural resource economics. His research involves the economics of water resources and the economics of nonnative invasive species

Q: Reducing pollution in public water supplies seems to be an issue recently in some communities in Colorado. What are some of the options for cities and utilities that need to try and decrease the levels of nitrates, sediment, or other pollutants in their water supply?

Eiswerth: Dealing with excess sediment, nutrients and other pollutants is generally an issue for water suppliers. Here along the Front Range these challenges have only been exacerbated recently in the aftermath of wildfires in key watersheds. I think that, in general, one of the most innovative emerging approaches is what is referred to as "investment in watershed services," or "payments for water-based ecosystem services." Such programs allow downstream private or public entities to pay upstream land managers to help implement land management practices that restore and protect water quality. There are numerous potential best management practices but some examples would include buffer strips along streams or low-tillage cropping on agricultural lands, or measures like fuel thinning to reduce the risk of wildfire and subsequent erosion and runoff on forestlands. In some instances, including right here in Colorado, some stakeholders are finding that it can be significantly less expensive to protect water quality at the source rather than investing in costly treatment technology downstream to remove pollutants — and of course there are other environmental and socioeconomic benefits from that as well. There are several hundred programs or markets like this in place around the world actually, and on the order of a hundred in the United States alone, with several more currently in development.

Q: From an economic standpoint, what are some immediate or short-term consequences of such incidents like the mine drainage accident affecting the Animas River?

Eiswerth: Two main impacts that come to mind are those on agriculture and outdoor recreation. Some farmers along both the Animas River and the San Juan River, into which the Animas flows, have needed to stop using river water for crops and livestock, at least temporarily. Economic impacts due to crop losses or reduced demand for livestock that come from these areas could be substantial, particularly in certain areas such as the Navajo Nation - we just don't know the extent of these impacts yet. In terms of recreation: the Animas River area is an important destination for water-based recreation. For example, the Animas typically ranks as one of the top five rivers in Colorado in commercial whitewater rafting user days, with between about 35,000 and 45,000 annually. In the short term, yes: Animas rafting and angling outfitters have had to shut down for a number of days following the spill, and that means not only their revenues evaporating for those days but also the need for individuals and families, some of whom are traveling here from far away, to quickly change their recreation plans. Sudden disruptions can be costly.

Q: What about longer-term economic impacts after a waste release accident such as that on the Animas?

Eiswerth: Longer-term impacts are much harder to predict - particularly any future impacts due to increased heavy metal volumes that have settled to the riverbeds. Going forward, though, one key question in all such cases is: how does an acute episode of any sort influence public perceptions of risks as well as the desirability of recreating in a river or, say, eating beef produced from a certain area along the river, even if actual risks might have fallen to very low levels? Perceptions are important. In fact, for recreation, some recent research strongly points to the influence that media reports and public perceptions have had in the past on the number of people who have chosen to go rafting on Colorado's Arkansas River following wildfire occurring elsewhere in Colorado. The way in which news stories and people's perceptions influence tourism, the demand for agricultural products, or other behavior is not as well understood as we would like, but we know that these factors matter. Finally, if you talk about the long term, you really have to place this accident in the context that there are over 200 identified abandoned mine sites in Colorado alone where scientists know that waste has been and is leaking into streams and rivers - this is a longstanding challenge with few easy answers.

Source: University of Northern Colorado

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