University of Agricultural Sciences, Bengaluru

The nature of non-point discharges of effluents into the environment makes direct control of environmental quality impossible. Economic theory suggests, however, that efficient pollution abatement is possible by controlling the use of those inputs functionally related to environmental degradation rather than controlling the effluents themselves. Water quality degradation caused by irrigation return flows is an example of the effects of non-point discharges which can only be controlled by restrictions on input use. The objective of this study was to examine the economic impacts of policies affecting agriculture which would improve water quality in the Yakima River. The Yakima River Basin is an intensively cultivated river basin in which the major user of river water is irrigated agriculture. Approximately 80 to 90 percent of the water in the lower reaches of the Yakima River during the late summer is irrigation return flow discharges. Consequently, water quality in the river is largely a result of irrigation return flow water quality. Three environmental quality parameters were identified for evaluation: nitrate nitrogen concentration in the river, water temperature in the river, and annua~ sediment lost for fanms in the Basin. A linear programming model was used to represent the agricultural sector of the Yakima Basin and the hydrology of the Yakima River. The linear programming model was fortran-linked to a simulation model which calculated values for the environmental quality parameters in each of 7 reaches resulting from the solution to the linear programming model. The effectiveness, producer cost, and social cost of alternative environmental standards were examined by changing agricultural input relationships. Policies included were an improvement of irrigation efficiency, tax on nitrogen fertilizer, charge for irrigation water, uniform reduction of water rights•, combination nitrogen tax and water charge, combination nitrogen and water rights reduction, and the prohibition of irrigation water runoff. These policies were compared with a benchmark solution representing currently existing agricultural organizationand environmental quality. The policy which most efficiently controlled nitrogen pollution was a combination nitrogen tax and water charge because nitrogen concentration is a function of water and nitrogen use. River water temperature was most efficiently reduced by a water charge, while sediment loss was most efficiently reduced by prohibiting surface runoff of irrigation water. However, prohibition of runoff had almost no effect on the other water quality parameters and required substantial capital expenditure for irrigation systems. Policies which involved income transfers through input charges resulted in larger reductions of net farm income than policies limiting input use. Consequently, environmental improvements resulting from uniform reductions of water rights were less costly to producers, although the efficient allocation of resources was adversely affected. Agricultural impacts were measured primarily by reductions of net farm income. Income reduction would clearly be reflected in reduced land value, livestock numbers, and volume in agricultural processing and supply industries. The results shoot that substantial improvements in environmental quality in the Yakima River are possible, but only at significant social and producer costs. These costs must be compared with the benefits of improved environmental qual ity in order to determine appropriate abatement policies and water quality standards.

University of Agricultural Sciences, Bengaluru

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