The relation between indicators for the crediting of emission rights and abatement costs - a systematic modelling approach for dairy farms -

• Applicant: Professorin Dr. Karin Holm-Müller
• Subject Area: Agricultural Economics, Agricultural Policy, Agricultural Sociology
• Term: from 2011 to 2016
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 213483508

If Greenhouse Gases (GHGs) are to be effectively reduced, agriculture as a non negligible emitter will have to contribute to abatement efforts. Accordingly, for some years already, the inclusion of agriculture, and especially dairy production as a main agricultural emitter in temperate climates, into an emission trading system or its exposure to a climate tax is discussed. However, most agricultural GHG emissions stem from non-point sources and cannot be measured directly. Therefore, GHG related economic instruments for agriculture must be based on accounting rules which estimate CO2, CH4 and N2O emissions, more or less correctly, from observable farm attributes (herd sizes, milk yields, feed use etc.). In the following we term such a system of accounting rules an emission indicator. Confronted with for example an emission tax agents will select their abatement strategy not based on actual emissions, but on the chosen indicator. The latter hence determines abatement strategies and related costs for a given emission target or tax. Against this background, we want to determine how the choice of indicator impacts on efficiency of abatement, distributional effects and the flexibility of the chosen path of abatement strategies of different farms and thus contribute to the discussion about the best policy design for an inclusion of agriculture into climate policy.

• DFG Programme: Research Grants
• Participating Person: Privatdozent Dr. Wolfgang Britz