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Centre for Economic Policy Research
Center for Economic Studies
Maison des Sciences de l Homme
Acid Rain
Author(s): David M. Newbery, Horst Siebert and John VickersSource: Economic Policy, Vol. 5, No. 11 (Oct., 1990), pp. 297-346Published by: Wileyon behalf of the Centre for Economic Policy Research, Center for EconomicStudies, and the Maison des Sciences de l'HommeStable URL: http://www.jstor.org/stable/1344480.
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5/20/2018 Acid Rain, by David Newbery
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Economic
olicy
October 990
Printed n Great
Britain
Acidrain
David
Newbery
Summary
Acid rain
is
not new
phenomenon,
ut nvironmental
wareness
has
grown
apidly
ver
he astdecade.
Much
data has been ollected
and the
ransmission
rocess
s
better
nderstood.
olicy-makers
n
Europe
have et hemselveshe
bjectivef uniform
0%
reduction
in
national
missions
f
ulphur
ioxide nd a
freeze
n
emissions
of
nitrogen
xides.
Whereas
imple
conomic
rinciples
ave
nformed
uch
f
the
policy ebaten theUS, the ame has notbeen rue n Europe.A
reduction
f
emissions
hich
s
uniform
cross ountriess
likely
o
be
highly
nefficient:
ather,
articular
missions
hould
e
curtailed
until the
marginal
ost
f
further
batement
quals
the
marginal
benefit
s measured
y
he
marginal amage hereby
voided.Within
and across
countries,
marginal
batement osts
nd,
a
fortiori,
marginaldamagefrom
cid rain
varygreatly.
hus
an
efficient
emission-reduction
rogramme
nvolves
unequal
reductions
f
emissionscross ountriesnd activities. hepaperoffersalcula-
tions
f
the tructure
f
an
efficient
rogramme,
nd
discusses ow
we can bestmakeuse
of
marketsnd
prices
odecentralize
s
many
decisions
s
possible.
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5/20/2018 Acid Rain, by David Newbery
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Acid rain
David
M.
Newbery
Department
f
Applied
Economics,
Cambridge
nd CEPR
1. Introduction
Air
pollution
is not a new
phenomenon-Londoners
in the twelfth
century omplained
about the noxious
fumes
from
burning
sea
coal,
and
the
corrosive ffects
f
sulphur
dioxide
(SO2)
dissolved
n rain have
been
well
understood
for
a
least a
century.
But the focus of concern
constantly
hifts. n Britain moke
AbatementActs date
from1853-56.
The landmark Clean
Air Act of 1956
was
primarily
response
to the
health hazards associatedwiththe
unregulated
burning
of coal. An
estimated
4,000
people
died
in
the
great
London
smog
of
December
1952.
The US
has also been concerned
with
reducing
coal
pollution,
but
was
also active
n
reducing
automobile
pollution
from
quite
early
on. Here
the
impetus
was
the
deteriorating
ir
quality
n
urban areas
like Los
Angeles
and
Washington
DC,
where
photochemical
mog
led
to
high
levels
of
ozone,
traced
to
exhaust
emissions
of
hydrocarbons
and
nitrogen
xides
NOx).
California ed
the
way
n
ntroducing ighter
emissions controls. n Europe, the impetusforenvironmental olicy
developed
because
acid rain
from
the
SO2
and
NOx
emissions
from
the
burning
of
coal
and
oil
-
is no
respecter
of national boundaries.
Each
locality
and
country
discovered
that
some
of the
immediately
harmful ffects
f
burning
oal
could be avoided
by building
tall chim-
neys,
but this
merelydispersed
the
pollutants
lsewhere,
often across
great
distances
to other
countries.
These countries
could
not
directly
controlthe
deposition
of
acid
rain,
and could
instead
only complain
I I
Research
support
from
he
UK Economic
and Social Research
Council's
grant
Privatisation
nd
Reregulation
f
he
Network
ndustriess
gratefullycknowledged.
am indebted
to
Margaret
Clark
for
assistance
with the literature
earch,
to Michael Hannaman
for
bringing
o
my
notice
the
paper
by
Maler
(1989),
to R.
G.
Derwent of Harwell
for his
extremely horough
and
helpful
scientific
omments,
nd
to David
Pearce,
John
Vickers nd
David
Begg
for careful comments.
None
of these s to
he
held
responsible
for
the
interpretations
have chosen.
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Acid rain
299
and
negotiate
for
ome
coordinated
olution
o
the
perceived
problem.
Different ountries
esponded
to different acets
f the
pollutionprob-
lem. The
Scandinavian countries
were
troubled
by
the death and
disap-
pearance
of fishfrom akes and rivers.Germans worried about forest
die-back.Glasnost evealedthe full
xtent
f
theenvironmental
isasters
in Eastern
Europe,
and
provided
the
focus
for
local
hostility
o the
environmental
nsensitivity
f central
planning.
Environmental wareness has
grown rapidly
over
the
past
decade,
and with
t
the
growing
realization hat we live
on
a
rather mall and
fragileplanet.
The
green
movementhas
had to work hard
to
capture
the attention nd
imagination
f the
public
and
politicians,
nd has had
to resort o emotionalarguments o getitsmessageacross.There is no
doubt
that the
hidden
environmental osts
of
current
echnologymay
be
high,
ven
life-threatening,
ut t
s
also clear
from ecent
xperience
that
the costs of
carelesslydesigned
environmental
egulation
an also
be
high.
As
economists,
we
have a
duty
to
argue
for
cost-effective
environmental
olicies.
Inefficient
olicies
not
only
achieve
less than
they
should,
but
they
also run the
risk of
alienating taxpayers
and
consumers
who
ultimately ay
for the
regulation
nd
may
undermine
the
aims of
the
environmental
movement.
conomists,
with
honourable
exceptions,have tended to ignoreenvironmental conomicsbecause it
seems
to raise few
new
ideas.
Most of the useful
techniques
have been
the stuff f
undergraduate
welfare conomics ince
Pigou's
day.
Though
each
generation
adds to
the stock of
knowledge
and
techniques,
the
subject
has not been at the theoretical
utting dge
for
ome time.This
might
ot
have mattered
f
conomists ad been
supplied
with ccessible
facts
with
whichto clothe
the
theory
nd to
bring
the
policy
ssues nto
sharp
perspective.
But these factsare
largely
produced by
scientists
unfamiliar
with
he economic
tyle
f
argument,
nd often nconcerned
with conomic costs nd benefits. here has been too little ommunica-
tion between the
disciplines.
It is
interesting
o
compare
the situation
n the US. The
style
of
regulation
exemplifiedby
the Environmental rotection
Agency,
nd
the
separation
of
legislative
nd executive
power,
means that
environ-
mental
egislation
has to be
argued
in a
quasi-judicial
way
before
being
enacted,
and
economistshave
been
centrally
nvolved n the
ensuing
debates
not
necessarily
uccessfully.
s a resultof
having
to make a
quantified
case in
public,
economists have
investigated
he
scientific
evidence,
have conducted
empirical nquiries,
and have identified
he
gaps
in
our
knowledge.
Environmental conomics
has received a
con-
siderable
mpetus
nd a
solid
body
of
theory
nd
evidence on which
o
build.
We in
Europe lag
behind,
though
there
are
signs
that
the times
are
changing.
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This
contribution
eals with
small
part
of the
environmental
ebate,
that
oncerned
with
cid
rain.
t
is
an
important
opic
not as
important
as
the
greenhouse
effect,
which s
global
in
scale,
and
probably
not
as
important
s traffic
ongestion,
which is a domestic matterfor each
country.
Nevertheless,
ubstantial
ums of
money
have been
spent
and
are now
being
committed n an
attempt
o
alleviate
he
problem
of
acid
rain. The
thrust
of this
paper
is
that this
programme
as
currently
interpreted
s
flawed,
nnecessarily xpensive,
nd
if t
succeeds,
t
runs
the risk
of
high political
cost.
Relatively imple
economic
principles
applied
to the
appropriate
facts
ught
to
be able to
achieve
the
same
environmental
enefits t
substantially
ower
cost,
nd
in
a more
decen-
tralized nd less politically roblematicway.
I
make no
apologies
for
the
high
ratio of
factsto
theory
n
what
follows.
The
environmental ebate
has been
long
on
emotional
argu-
ment and
shorton
substance
for too
long.
I
am not an
expert
n this
field,
nd
have
had to
rely
on
secondary
ources for the
data. On the
crucial
ssue of
quantifying
he
benefits f
reducing
acid rain
I have
not
been
able to
find
dequate
evidence
and so
cannot
finally
uantify
the
efficient
olicy.
But I
have
found
enough
evidence to cast
consider-
able
doubt about
the
priorities
or
abatement,
nd
to
suggest
where
research efforthould be concentrated. everal findings urpriseme.
Fish death
from
cid rain
is
sad,
but
economically
unimportant.
ree
death
may
be far
more
important,
hough
there
are
worrying
ncer-
tainties
bout the
cause and
cure of
this
problem.
Health
problems
associated
with
oal
emissions,
articularly
he
combination
f
SO2
and
particulates
smoke
particles)
are
potentially
f
the first
mportance,
whereas
those
associated with
NOx
and ozone
seem
trivial.
2. Acid rain and its effects
In
order
to
understand the
acid
rain
problem
it
is
necessary
first o
describe
the
causes
and
consequences
of
acid rain.
Considerable scien-
tific
esearch
over
the
past
decade has
illuminated his
phenomenon,
though
uncertainties
emain.
The
next
step
is to
identify
he
sources
and
measure
the
amounts of
pollutant
eleased,
and their
destination.
What s it
that
causes
the
damage,
where
does the main
damage
occur,
and what
are
economically
he
most
expensive
consequences
of
acid
rain?
Finally,
one
needs
to
determine the
techniques
available
for
reducing
emissions, nd the costsof
abatement,
n order to
identify
cost-effective
batement
policies.
This
last
step
is
usually ignored
by
ecologists
nd
politicians,
who
are
content
once
they
have
found
ways
of
reducing
acid rain
to
press
for
the
maximum
politically?)
easible
degree
of
abatement.
This section
ddresses
each
issue
in
turn.
300
David
Newbery
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2.1.
Defining
acid
rain
Acid
rain s
normally
nderstood o include the
deposition
of
the
acidic
combustion
productssulphurdioxide, SO2,
various
nitrogenoxides,
NOx,
and
chloride,
Cl-,
either s
dry
gases
or
particles,
r
as
wet
deposits
in
rain, now,
sleet,
hail,
mistor
fog.
These
pollutants
sually
undergo
a
seriesof chemical
ransformationsnto
sulphuric
cid,
nitric cid
and
hydrochloric
cid. These acids
affect he
environment,
oth
directly
and
indirectly
n
causing
the release of further
armful hemicals uch
as aluminium.Acid rain can
be
measured
n a
variety
f
ways
in terms
of
tonnesof the
original
gases
released,
or
tonnes
of
elemental
ulphur,
or in terms of the
acidity
of the
rainfall,run-off,
treams or lakes.
Aciditys measuredin pH unitson a logarithmiccale.' As thescale is
logarithmic,
ainfall
with a
pH
of 5
is
10
times as acid as that with
pH
of 6.
Unpolluted
rain
s
slightly
cidic
from
issolved
arbon dioxide
and has a
pH
of about 5.6. Sea
water s
naturally
lkaline,
having pH
of 8.3.
Most
SO2
comes
from
arge
combustion
plants-thus
in
1987,
85%
came
from
arge
combustion
plants,
nd
73%
from
power
stations.Of
UK emissions
rom ossil
uel
combustion,
9%
came
from
oal
combus-
tion and
12%
fromfuel oil.2
Sulphur
dioxide
pollutes
he environment
throughtwo different outes.Much of the gas fallsto earthwithin
300 km of the
source
in
its
dry
form,
nd this
process
s described as
dry
deposition. Long-range transport
ccurs
because
SO2
is
oxidized
to
sulphateparticles,
which re not
readilydeposited
n
dry
form.
Their
main removal s
by scavenging
n
rain-making rocesses
s wet
deposi-
tion,
which
may
occur
1,000-2,000
km from he
source.
Wet
deposition
can be
reported
n two
ways by
ts
ntensity
nd cumulative
eposition.
Intensity
s shown
by
the
maps
of the
average acidity
f
precipitation
(in
pH),
and
cumulative
depositionby
wet
deposited acidity
n
gramsof
hydrogen
ons
per
square
metre
per year. Deposited
acidity
s the
product
of the
acidity
of the rainfall nd
the
amount
of rain wetter
areas
in
the west
may
have more
acid
deposited
even
though
the
precipitation
s less
acidic.
2.2.
Measuring
acid
rain
The
European
Monitoring
nd Evaluation
Programme
EMEP)
was set
up
in 1978 to monitor he movement f
pollutants,
nd
to determine
I I
pH
is defined as the
negative
ogarithm
f
the
hydrogen
on
(H+)
concentration,
aving
the
perverse
effect
hat lower numbers
correspond
to
higher
acidity.
Thus
0
is
most
acid,
7 is
neutral
and
14 most alkaline.
Lemon
juice
has a
pH
of
2,
milk of
magnesia
10.5.
2
UK data are
taken from he
Digest f
Environmentalrotection
nd Water
tatistics,988,
Depart-
ment of the
Environment).
igures
after 1970 are based
on revisedemissionfactors escribed
therein.
Acid
rain
301
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where the
deposition
of
pollutants
eleased fromeach source
occurs.
Until
recently
he
only
pollutant
rackedwas
SO2,
though
now
NOx
is
also
monitored.The surface
f
Europe
is divided nto
squares
with
gridlines 150 km
apart.
There are about
720
grid
ineintersectionsn land
and
about
100
monitoring
iteswhich re used in the EMEP model
and
these
are
termed
rrival
points.
Using
detailed
meteorological
nforma-
tion,
the track
of air
which
arrived
at
each of the
820
or
so
points
s
followed
backwards
n
time for96
hours. An air
parcel
is then studied
forwards
n
time
as
it
follows
each back-track
precisely,
picking
up
pollution
and
depositing pollution
until it
arrives back at its arrival
point.
This whole
procedure
for
each of
the
820
points
s
repeated
at
six-hourlyntervals 65 daysof theyear.The model alsokeepsa record
of the
pollution produced by
each
country.
Not all the
deposition
can
be tracedback
to an
identified
ource,
s
meteorological
ata is accurate
enough
to track
back
for
only
96
hours. Table
1
gives
a
subset of the
basic data
from
this
exercise for
1987,
and
is
to
be read
as
follows.3
Looking
along
the row
against
GB the table showsthat
Britainreceived
14,000
tonnes of
sulphur4
i.e.
about
27,000
tonnes
SO2)
from
France,
11,000
tonnes
from
West
Germany
DE)
and
571,000
tonnes from
domestic
sources.
Looking
down the
column headed GB the
Table
shows that Britain emitted1,271,000 tonnes of sulphurwhose final
destination
could be
established,
and of this
43,000
tonnes fell on
France.
45,000
tonnes on
Germany
and
437,000
tonnes
on
North
Africa within the
monitoring
rea
(demonstrating ust
how
far the
plume
can
travel).
The
large
numberson the
diagonal
of Table 1 showshow
important
domestic sources of
pollution
are. The
large off-diagonal
numbers
indicatewhere the
major mpacts
f
one
country
n another
occur,
nd
it
is
striking
hat
they
primarily
ccur in
East
Europe,
confirming
he
viewthat central
planning
has been an environmental isasterfor ts
participants.
Table
2
presents
the
information rom the
same
programme
n
a
different
ay.
The first wo
columns
give
totalemissions
not
ust
those
whose final
destination an
be
identified)
or the
base
year
1980 and
the most
recent
year
available,
n
order of
magnitude.
This allows an
estimateof the
extent to
which
countries have succeeded in
moving
towards
he
target
30%
reduction
now
widely ccepted.
The next two
columnsgive depositionswithin he country, nd an estimateof the
I
1
3
The
fullertable is
given
in
the
Appendix
and is the
source of
calculations
reported
below.
Using
the
abbreviated able
leads to considerable
biases in
estimating
otal
damage,
and the
complete
table should be used for
all
calculations.
4
To
convert
ulphur
to
sulphur
dioxide,
multiply y
1.9,
or
roughly
double the numbers.
302
David
Newbery
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Table
1.
Origins
of
sulphur deposition
in
Europe
(thousand
tonnes
a
year)
Emitters
CS
FR DD DE
BL HU
IT PL ES
SC
Czechoslovakia
CS
France
FR
GDR
DD
West
Germany
DE
Benelux
BL
Hungary
HU
Italy
IT
Poland
PL
Spain
ES
Scandinavia
SC
USSR*
SU
Britain GB
Other
Europe
OE
N. Africa
NA
Sum
Error
385
11
128
28
5
45 10 95
1
19
332
41 40 28
5
21
15 65
84
14
725
61
11 2
2
32
1
47
69 163 330
44
3 13 23
6
4 32
15 51
102
0 0
4
2
31
3
16 6
1 190
12
25
0
13
21
15
8 2
11 353
14
10
145
15
310 47 10
40 10 790
1
2
11 5
3 1 2 2
3
523
17 5
48
18 6
4
2
44 0
107
10
167
36 8 84
13
337
1
5 14 15 11 8 0 1 3 2
95
40
97 49 8
141
136
101
29
105
136 253
131
71 64 182
194 210
1,064
721
2,005
823
322
594
759
1,685
856
5
8
7
4 17
3 2
5 5
0
0
0
0
0
0
0
1
0
59
8
0
3
28
107
8
Source:
Acid
Magazine,
Sept.
1989,
fromEMEP
data.
Notes:
Sulphur
dioxide
figures
will be
about
twice s
large.
*
European part
of
USSR within
EMEP area
of
calculation.
UI
=
unattributable
o
any
country, lus
a small
amount
from N. Africa.
Receivers
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Table 2.
Sulphur
emissions
(thousand
tonnes
or
%)
Emissions
Change
Depositions
1980
1987
%
1980
1987
USSR* 6,400 5,100 -20 5,101 3,584
GDR
2,500
2,500
0 963
979
Poland
2,050 2,270
+10
1,443 1,492
UK
2,335
1,840
-21
803
702
Spain
1,625
1,581
-3
670
674
Czechoslovakia
1,550
1,450
-6 818
765
Italy
1,900 1,252
-34
916 562
German
Fed
Rep
1,600
1,022
-36
1,083
821
France
1,779
923
-48
1,160
760
Hungary
817
710
-13
416
337
Yugoslavia
588
588
0
662
497
Bulgaria
517
570
+9
293
235
Belgium 400 244 -39 162 121
Greece 200
180
-10
150
119
Turkey
138
177
+22
209
210
Finland 292
162
-44
273 210
Denmark
219
155
-13
110
83
Netherlands
244
141
-42
175
139
Portugal
133
116
-13
83
83
Sweden
232
116
-50
333
307
Romania
100
100
0 405
330
Ireland
110
84
-24
66
68
Austria
177
75
-58 282
207
Norway 70 50 -29 199 194
Switzerland
63
31
-51 121
70
Total
26,078
21,471
-18
20,484
16,695
Source: Acid
Magazine,
Sept.
1989,
from
EMEP data.
Notes:
Sulphur
dioxide
figures
will be
twiceas
large.
Countries
ordered
by
1987 emissio
*
European
part
of USSR
within
EMEP
area
of
calculation.
Figures
for emissions
n 1987
based
on
interpolation
xcept
for
USSR,
UK,
Czechoslova
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fraction
f
depositions
which can be
traced
back
to
domestic
sources
(using
Table 1
data).
This
confirms
he
importance
of
the
diagonal
element n
Table
1,
and
the
mportance
f
domestic
ourcesofpollution.
The
final olumn
gives
the
ratio of
exports
of
SO2
to
imports.
As total
depositions
n
1987
are
only
78%
of
total
emissions,
his
ratio can
be
expected
to
be
significantly
bove
unity
on
average.
The
smaller t
is,
the more
the
country
s
sinned
against,
han
sinner.
Britain
tands out
as
the
greatest
inneron
this
criterion,
nd the
Scandinavian
countries
as those
most
sinned
against.
Only part
of
total
SO2
emissions
ome from
man-made
ources;
other
important
ources
nclude
volcanoes,
biological
decay
and
forest
fires.
These natural ourcesmight ccount for80-290 mn.tonnesperannum
worldwide,
compared
to
total
man-made
emissions of
75-100
mn.
tonnes.
The levels
and
mechanisms
responsible
for
natural
emissions
are
imperfectly
nderstood,
but
they
may play
an
important
ole in
the
European
acid rain
problem.
The
information
enerated
by
EMEP
is
remarkably
seful,
not
only
in
quantifying
he level
of
pollution,
but also in
identifying
fficient
and feasible
batement
policies.
The
information
n
deposition
can
be
used to draw
maps
showing
the
average acidity
of
precipitation
ver
Europe using contour ines of increasing evels of acidity.Such maps
show
that
n
1987 most
of
Yorkshire
nd the
East
Midlands had
precipi-
tation f
average
acidity
elow
pH
4.3,
(i.e.
five
imes
s acid
as
'normal'
rain
with
pH
of
5.0)
whereas
Wales,
South-west
ngland
and the
west
coast of
Scotland
was
above
4.6,
and so less
acid.
Substantial
reas
north
of
a line
joining
the Wash
and
Liverpool
received
more
than
0.05
gm
H+
per
square
metre
y
wet
deposition
i.e.
0.5
kg/hectare
r
50
kg/km2),
with
Wessex,
East
Wales,
Northern
reland
and
North-east
cotland
receiving
ess
than
0.02
gm.
Most
of the
sulphurdeposition
n
the
UK
occurs
through dry
deposition
as
SO2,
particularly
n the southand
eastof
the
country.
n
the north
nd
west
where
rainfall s
more
frequent
and
intense,
wet
deposition
f
SO2
and
sulphate
particles
ecomes
more
significant.
In
a
European
context,
he
lines of
equal
rainfall
cidity
how
the
highest
concentrations
n
Germany
and
Poland,
with
pH
below
4.1,
with
most of
Southern
France,
almost all
Italy,
Spain,
Portugal,
West
Yugoslavia
and
West
Greece
having pH
greater
han 4.9
(i.e.
less
acid
thanany partofthe UK and Ireland).
The EMEP
tables can
also be
used to throw
ight
on
the
political
economy
of
pollution
control.
Consider first
he column
in
Table
2
which
gives
the
fraction f
total
deposition
which can
be
attributed o
domestic
ources.The
unweighted verage
of
these
figures
s
41%
(with
a
standarddeviation f
21%).
The
weighted
verage
heavily
nfluenced
Acidrain
305
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by
the
larger
countries,
specially
he
USSR, which,
by
their
ize,
have
higher
domestic
absorption)
s
52%.
The
weighted
average
domestic
absorption
s a fraction
f
total
production
s
33%,
and
the
unweighted
average
s 29%
(with
standarddeviation f
only
5%). What thismeans
is
that the
average
unilateral
cost of
reducing
a tonne of
domestic
deposition
s
equal
to
the
cost of
reducing
domestic
missions
by
about
3
tonnes.
The ratio of total
European
depositions
to total
European
emissions
s
66%,
so that f
all
European
countries
cted
in
concert,
he
cost
of
reducing depositions
by
1 tonne
would
be
only
half as
great.
Put another
way,
many
countries
ould
reduce
depositions
within heir
borders
by
about
50%,
but at twice he cost
per
tonne
reduced as
if all
countries cted together.There are thusconsiderablebenefits o coor-
dinated
action,
but these
should
not be dramatized
SO2
pollution
s
farfrom
pure
public
good
at
the
country
evel,
nd
self
nterest
ught
to
go
a
considerable
way
towards
lleviating
he
problem.
The next
question
one can ask of
the EMEP data
is whether
here
are
significant pportunities
or
bilateral
bargaining
between
pairs
of
countries ver
pollution
evels. One
way
to
identify
uch
opportunities
is to
ook
for
nstanceswhere
the volume of
bilateral
pollution
xchange
is
large
relative o total
depositions,
nd where trade
is
bilateralrather
thanunilateral.The volume can be measuredbyone-half xportsplus
imports,
nd bilateralism an be
measured
by
the
difference
etween
exports
and
imports.
Table
Al of
the
Appendix
gives
the
net
ex-
ports
of
each
country
nd can be used to
identify
he extentof
bilater-
alism.
The
following
ountry
pairs
have a difference etween these
two measures
of
5%
of
depositions
or
less for
the
smallerof the
part-
ners:
Czechoslovakia-GDR;
Czechoslovakia-Hungary;
zechoslovakia-
Poland;
GDR-Poland;
Poland-Hungary;
USSR-Czechoslovakia;
USSR-
GDR;
USSR-Hungary;
USSR-Poland.
It is
notable that
significant
balanced exchange of pollutionis confined to Eastern Europe, and
does not affect
ny
of the other countries dentified
n
Table
2.
(It
may
be substantial
for
smaller countries
as a
proportion
of their
deposition.)
Another
possiblequestion
to
ask
s which
pairs
of
countries
have
large
net
tradebalances
n
pollution
which
might
ead to financial
egotiations
over
pollution
evels.
The
following
ountrieshave net
imports
from
another
country
which re
greater
han
5%
of total
depositions:
Poland
from
GDR
(19%);
Denmark from
GDR
(12%);
Scandinavia fromGDR
(10%);
Scandinavia from Poland
(9%);
USSR from Poland
(9%);
Czechoslovakia from
GDR
(6%);
Scandinavia from USSR
(5%).
Scan-
dinavia thus contains
he
only
West
European
countries
whichreceive
large
net
mports
rom
ingle
ountries otherwise
t s the
Easternbloc
countries hat stand
out as
large
net
importers
rom
ach other.
306
David
Newbery
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Table 3.
Emissions
per
head
(kilogramsper
head
per year)
SO2 NO,
1980 1985 1980 1985
Austria 47 18
29
28
Czechoslovakia
202
203
78 73
France 65 31 34
29
Germany
Fed
Rep
52
43 49
49
Greece 83 73 13 15
Ireland
63
39
21
19
Netherlands 28
25
35
34
Poland
115
116
5 18
Spain
87 75
21 24
Sweden 64 33 38 37
Switzerland 19 15
31 33
UK 85 65
35 33
Canada
193 150
72 72
US
102
90
90 83
Averages:
All 86 70 39 39
Europe
76
61
32 32
West
Europe
59
42
31 30
Source:
UNECE
(1987)
abatement.
National
trategies
nd
policies
or
ir
pollution
Note:
Averages
are
unweighted.
Nitrogen
oxide emissions.
Nitrogen
xide,
or
NOx,
emissions re measured
in
terms f tonnes
nitrogen
dioxide
equivalent,
NO2.
Table 3
gives per
capita
emission
levels for both
SO2
and
NOx
for the
major
member
countries f
the UN Economic Commission
for
Europe
Conventionon
Long-range Transboundary
Air Pollution. t shows
that
UK levels are
not
high
n
comparison
with
urope
and
NorthAmerica
aken
ogether,
but are ratherhigher hanthe WestEuropean countries n thesample.
The table
shows that
whereas
SO2
has decreased
between 1980 and
1985,
NOx
has if
anything
ncreased.
Table
4
gives
further nformation
bout
NOx
for
1985. The first
column shows that
mobile sourcescontribute bout one-half f
all
NOx
emissions
in
Western
Europe
(actually
OECD
Europe),
though
the
range
is
from
28%
in
Eire
to
84%
in
Norway.
Much
of
the rest
comes
from
arge
combustion
plants-thus
in
Britain
35%
of the
total came
from
power
stations.
The next
column shows total emissions
of
NOx
frommobile and
stationary
ources n relation ototal
energy
use.
The coefficient
f
variation
CV)
is
34%,
showing
hat missions
orrelate
quite closely
with
energy
consumption,
but
there are
important
ari-
ations
n
the
degree
to which
energy
use causes
NOx
pollution.
Britain
does
poorly by
this
score,
almost as
badly
as
Portugal
and
Greece.
307
cid
rain
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Table
4.
NO,
emissions
frommobile
and other
sources
Ratio
of total
NOx
to
Ratioof mobileNOx to
Mobile
NOx
energy
(%
of
total)
consumption
GDP car
use petrol road fuel
Country
(1)
(2)
(3)
(4) (5)
(6)
Austria
68
10.1 1.27
3.76
61 37
Belgium
55 9.0
0.84
2.73
44 22
Denmark
34 15.9
1.04
2.48
61 35
Finland
58 14.8
1.80
7.62
86 47
France
66 13.1 1.29
2.81
62
38
Germany
59 14.6
1.54 3.73
70
46
Greece 63 18.6 3.35 4.36 75 44
Ireland 28 10.7 1.08
22
14
Italy
51
14.8
1.06
2.03
70 34
Luxembourg
64 6.9
2.32
5.61 45
28
Netherlands
60
10.5
1.53
3.27
95
56
Norway
84
12.3 2.27
9.65
113 81
Portugal
38
19.6 3.38 4.13
123
54
Spain
46 18.5
1.49 4.50
67 36
Sweden
68
9.2
1.48 3.26 52
37
Switzerland
74 11.1
0.92
3.04
49 41
UK
45 16.4 1.65 2.96
44
32
Europe 49 14.1 1.42 3.15 63 39
SD
unweighted
14
4.76 0.83
2.01
25 14
CV
0.29
0.34
0.58 0.63
0.40 0.37
Sources: UNECE
(1987)
and
OECD
(1987).
Data for
1985-86.
Notes:
(2)
shows
kg
of
NOx
per
tonne of
oil
equivalent
of
energy
onsumption
nd
(3)
per
unit
of GDP.
(4)
shows
gm
of
NOx
per
km driven
by
cars.
(5)
and
(6)
show
kg
of
NO,
per
kg
of
petrol
nd
kg
of total road
transport
uel. SD is standard
deviation
nd
CV coefficient
f variation.
(Figures
for
Luxembourg
seem rather
ow and
may
be
explained
by
some
energy
ales,
especially
f
transport
uel,
being
consumed
abroad.)
Column
(3)
shows
mobile
emissions
f
NO,
per
unit
of
GDP
(which
has
a lower CV
than
total
emissions
per
unit
of
GDP).
Column
(4)
gives
mobile emissions
n
gm
NO2
per
km
driven
by
cars.
White
1982,
Table
2)
shows that f there
were
no emissions
regulations,
hen
forthe
US
64%
of total
NOx
emissions
would come
from
ars,
and
the
balance
of
36% from rucks.Uncontrolled missions re 5.44 gm/km orcars, nd
38.6gm/km
from
heavy
diesel
trucks.
The
expected
uncontrolled
emissions
per
km driven
by
cars
alone
might
herefore
e
8.5
gm/km
(i.e.
5.44/0.64)
f
the
proportion
f car
km
n
total
vehicle
km were the
same as the US.
The
European
average
is 3.15
or
only
37%
of
that
predicted
for uncontrolled
missions.
Perhaps
more
impressive,
f the
308
David
Newbery
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total emissionsfrom ll mobile sources
are
attributed
ntirely
o
cars,
then
the
average
achieved is about as
good
as those achieved
in
the US
by
cars
of
later than 1976 model
year
White,
1982,
Table
10).
The last
twocolumns relate mobile emissions o two
transport
uels.Column
(5)
gives
mobile emissions n
kg
per
tonne of
gasoline.
The finalcolumn
gives
total
mobile emissions
divided
by
total fuel consumed
in
the
transport
ector,
and thus accounts
for
diesel
emissions,
which are
potentially uite
serious.
Nitrogen
xides also come fromnatural
s well as man-made ources.
Again
estimates
re
very mprecise,
but natural sources
may
account
for
20-90
mn.
tonnes
compared
to estimated otalman-made
emissions
of about 90 mn. tonnes. One might herefore rgue thatperhaps only
half the
total
acid rain
emissions re
man-made,
but
whereas
natural
emissionsare
worldwide,
man-made sources are
concentrated
n the
northern
hemisphere,
nd
specifically
n
Europe
and North America.
2.3.
Assessing
the
damage
caused
by
acid rain
Acid rain has
ecological consequences
in that
t
affects he
soil,
vegeta-
tion,
specially
orests,
akes
and
hence
fish).
t causes
economic
damage
to man-made structuresbuildings,fabrics,metals),and it can affect
human health.
The
ecologicalconsequences
re
complex
nd still
ubject
to scientific
ncertainty
nd hence
dispute.
Soils
vary widely
n their
ability
o
buffer
i.e. neutralize)
cid
rain,
and natural
processes
add
to
the
man-made sources of acid rain. Recent work undertaken for the
UNECE
Convention on
Long-range Transboundary
Air Pollution5
attempts
o establish ritical oads for various kinds of
soils,
which,
f
exceeded,
would mean that he oilcould no
longer
neutralize dditional
acid rain
depositions.
Many
sensitive reas
especially
n
Scandinavia
experience
both
high
rates of
deposition
and soils for which critical
loads are
low.
The effects f
acid
runoff n
lakes have been
intensively
tudied in
Scandinavia and the UK
(and
doubtless
elsewhere).
One of the main
mechanisms
eading
to
the
decline
in fish
stocks is the
release
of
aluminium aused
by
acidification,
ather han the direct
ffects
f
acid
(see
e.g.
Environmental
Resources,
Limited,
1983).
Palaeoecological
studies
of core
samples
can traceback
acidity
evels nto
the
distant
ast
and show substantialfalls in pH in many lakes after the industrial
revolution.
Thus
Battarbee
et
al.
(1988)
analysed
lake acidification n
sensitive reas
in the
UK and
found
thatbefore 1850
most akes
studied
I
I
5
Reported
n Acid
News,
No
3,
October 1988.
Acid rain
309
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had
pH
levels of
about
6.0,
but
that ince
then
pH
values had declined
by
0.5-1.5,
(i.e.
acidity
had
increased
by
between
3
and
30
times)
depending
on
deposition
rates and
bufferingapacities.
Other
studies
show
similar
trends,
and also show
that
lake
acidification
may
be
reversed
even
if
temporarily) y
the addition of ime either o
the
ake
or the rivers
n the
catchment rea.
This
is
expensive,
s
about 5
g/m3
of
bicarbonate
usually
n the formof
limestone)
re
required
to raise
the
pH
from
4.5 to
6.5,
and
it
does not
by
itself estore
he
lake
to
its
original
condition
restockingmay
also be
required.
(See
e.g.
Dudley
et
al., 1985; Britt,
1986.)
One
implication
whichdoes
not
eem
to
have been
adequatelyempha-
sized is thatacid rain is a stockpollutant s well as a flowpollutant.
That
is,
part
of the final
damage
caused
will
depend
on stocksof
acid
in
the
environment,
ot
just
the rate at which acid rain is
deposited.
Even
if
the environment
s
capable
of
neutralizing
r
disposing
of some
of the
acid each
year,
f inflows
xceed this
rate of
disposal,
then the
stockof
acid will
ncrease.
In
the UK it is
believed
that current
evels
of soil acidification re a
legacy
of
the
Industrial
Revolution,
nd that
water
quality
will
not be
restoreduntilthe soil recovers.This
recovery
is a slow
process
nd
relatively
nsensitive o near-term atesof emission
reduction, equiring imingforrapid recovery.6 his maygo someway
to
explaining
he
paradoxical
relationship
etween
decreasing
evels of
SO2
emissions n the one
hand,
and
apparently eteriorating cological
conditions
n the other.On
the other
hand,
Battarbee
et
l.
(1988)
note
that acid
deposition
has been
declining
n
Scotland
over
the
past
15
years,
and that
the
uppermost
sediments are
already recording
an
improvement,
hich
uggests possibly
wift
mprovement
f
deposition
levelscould be
further educed. The
speed
of
response
will
presumably
depend
on the
ecologicalcircumstances,
ut
may implyhigh
rates of
'depreciation'
ofacid stock evels.
Lake and fish
damage appears
quite
well
understood
compared
to
the
damage
suffered
y
trees.The
problem
was
highlighted
n
Germany
in the
early
1980s,
and shown to occur
elsewhere. Forest
damage
has
been attributed
o acid
rain,
weather
changes
and
droughts,
he
age
of
trees,
fragility
f
soils at
high
altitudes,
nd
inappropriate
forest
management.
Ozone
attack
appears
to
be
important,
nd
may
have
synergistic
nteractions
with
acid
rain
(Environmental
Resources
Limited,1983). Even if theexactproportion fdamage attributableo
acid rain s not
known,
here
seems
widespread agreement
hatreduc-
tions
in acid rain would be beneficial o
forests. imilar
uncertainty
pervades
the
study
f
crop damage, though
again
ozone
appears
to be
I
1
6
Personal
communication
romProfessorDavid
Pearce.
310
David
Newbery
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more
directly
armful
han acid rain.
To the extent hatozone
plays
a
major
role n
crop
and forest.
amage,
NOx,
which
s a
major
contributor
to ozone
production,
s
more
damaging
than
SO2.
Damage
to
buildings
and materialsoccurs
primarily
n urban areas
as
a
consequence
of
relatively igh
concentrations
f
SO2,
with ittle
effect etected
from
xposure
to
NOx.
The effects
ave
been observed
and
correctly
ttributed or
centuries,
nd
the
estimated
damage
costs
are
thought
o be
high.
Health effects f intense
pollution
an be dramatic-
as noted
above,
it is estimated
that
4,000
people
died in the
great
London
smog
of
December
1952.
Similar
evels
of
SO2
concentration
were attained
n
a
subsequent episode in London from 3-7 December 1962, after the
Clean
Air Act of 1956
had lead
to a
dramatic
fall
n
smoke concentra-
tions. This time an estimated
340
died,
suggesting
that the earlier
episode
was so
deadly
because
of
synergistic
nteractions etween moke
particles
nd
SO2
(Park,
1987,
p.
127).
It
appears
that
t is
the
gas
SO2
that s
harmful,
ather
han
the
wet formof acid rain. Acid rain in its
wet
form
an have indirect ffects
y
releasing
toxic
heavy
metals
nto
water
upplies.
ndividuals
vary onsiderably
n
their olerance
o these
gases,
but
there is some evidence from
epidemiological
studies that
long-term xposureat lower evelsthan thesedramatic pisodes can be
harmful o
health
Park,
1987,
p.
127.
See also Pearce and
Markandya,
1989,
for
summary
f the
extensive conomics
iterature
n
the health
impacts
of
SO2.)
If
SO2
and
particulates
re
lethal,
the
health
case
against
NOx
is
at
best
unproven,
for t
appears
that
NOx
is
much less active
biologically.
There is
a
certain
irony
in
the fact that
the
impetus
to
reducing
automobile missions
nitially
ame from
California,
where
t
was
suspec-
ted,
nd later stablished
hat
photochemical mog
was caused
by
vehicle
exhaust.The case mounted
by
he US Environmental rotection
gency
for
reducing
missionswas based on the
supposed
adverse
health ffects
of
high
oncentrations
f
ozone,
though ubsequent
tudies
Lave,
1982;
White,
1981;
1982)
cast considerabledoubt on the evidence. To
quote
White
(1981,
p.
59-60):
'...
the
ozone-related health effects
nder
discussion
were
short
erm nd
reversible....
Thus
far,
zone
exposure
has not been demonstrated
o
have
ong-term
ebilitating onsequences
in
humans.... The contrast
with
other studies of
pollutants,
uch as
particulates nd sulphates,was striking.... Particulates nd sulphates
probably
killed;
ozone
appeared
to do
littlemore than cause
coughing '
2.4.
Measuring
the costs
of acid rain
damage
Estimates
orthe
costs
of different
ypes
f
damage
are
scattered
n the
literature,
nd
varygreatly
n their
reliability.
earce and
Markandya
311
cid rain
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17/51
(1989)
provide
a useful
methodological
iscussion f
cost-benefit
naly-
sis
applied
to
environmental
ollution,
ummarize a
variety
f
these
estimates,
nd
note the
criticisms o which
they
are vulnerable. One
approach
familiar o economists s to askwhat
people
wouldbe
willing
to
pay
for
property
ocated
in
less rather
than more
polluted
air,
as
reflected n the
response
of
property
alues
to
pollution
evels.
Most of
the
estimateshere come
from he 1960s and
1970s,
and
suggest
that
for
each
1%
increase
in
SO2
concentration,
roperty
values
fall
by
between
0.06-0.15 of
1%
of their
value for
a house of
average
value.
An
alternative
pproach
is to
look at
the direct conomiccosts
aused
by
the
acid
rain,
and
this has
been done
by
for the
Netherlands
for
1986. It was estimated hatcurrent osts wereabout $53-175 mn. per
annum,7
but
f
the
costsof
dealing
with
future
damage
were
taken
nto
account
(loss
of
timber
tc.)
this
might
rise to
$120-380
mn.
Looking
at the current
costs,
the
large
proportion
of the
total comes from
agricultural damage,
thus
extra
liming
of the soil to counteract
acidification
might
cost
$18-60
mn.,
and falls n
crop
yield
might
be
$36-360
mn.
One should
of
course be most
wary
bout
estimating
he
value of lost
agriculturaloutput
given
the
distortions f the
CAP.
Indeed,
as an
aside,
agriculture
s
responsible
for
considerable
ground
waterpollution notablynitrates,nd possibly lgal blooms).Much of
this s n
turn he
consequence
of ntensive
gricultural
ractices
nduced
by
the
high agriculturalprices
enjoyed
under the
CAP,
notablyhigh
fertilizer
evels.
f
forvarious
reasons t
s
difficulto reform
gricultural
output price
levels,
then there
s
a
strong
ase for
raisingagricultural
input
price
levels to the same ratio
to
world
prices
as
output prices
enjoy.
This
would
improve
the
efficiency
f
resource use and
reduce
the
deadweight
osses associated
with
the CAP. Thus if
output
prices
are
twice
mport
parity
evels,
then fertilizer
rices
should be taxed to
raisetheirpriceto twiceworld market evels.This would
go
some
way
to
reducing
another
formof
environmental
ollution.
See
Newbery,
1990,
for
the
details of the
arguments
n
efficient
nput
taxation.)
Other
ecological
damage
estimates
are
given
in
Environmental
Resources
Limited,
1983).
German forest
amage
was
put
at
$0.25
bn.
p.a.,
and
rough
estimates
f
potential
EC
wide
damage
can be
deduced
from he
annual value of
spruce
and
fir
orestry roduction
f
$6.6
bn.
p.a.
Thus
if
20%
of
forests re
adversely
ffected
o that heir
production
drops by 10%,
the
loss is
$0.13
mn.
p.a.8
OECD
(1981)
estimated hat
I
I
7
Unless
otherwise
tated,
ll cost estimates
re in mid-1989
purchasingpower, updating
from
the US consumer
price
index.
8
But
note that here
s still
onsiderable
disagreement
s
to
how much forest
amage
has occurred
and
how
much
s
caused
by
acid rain.
312
David
Newbery
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the value
of
fish oss in
Scandinavia was
$38
mn.
p.a.
and
in
Scotland
might
be
$0.7
mn.
p.a.
Acid rain causes
material
damage,
whose
costs,
excluding
the
costs
of
restoring
istoric
uildings,
have been estimated
by
UNECE
(1982)
at between
$4-17/head
(i.e.
$1.0-4.7
bn. for
the
1983
European
Com-
munity
s a
whole).
The
figures
n
the Netherlands
re somewhat
higher
($10-19/head)
and in
Germany
are estimated at
$19/head.
Environ-
mental
Resources
Limited,
1983)
gives figures
romOECD
(1981)
for
the estimated
otal
orrosion
damage
for
12
OECD
European
countries
to
galvanized
teel
nd
its
paintcoatings
n 1974. For the UK the
figures
were
$5.9
bn.
p.a.,
for West
Germany
$9.5
bn.
p.a.,
and
for
Belgium,
Luxembourg,Denmark,France and the Netherlands ogether 3.3 bn.,
or
in total
$18.7
bn. How much of
this
can be
attributed o acid rain is
stillunder
study.
Reducing
car
emissions would
also
reduce
photochemical mog
in
some areas-
particularly
hose which
experience temperature
nver-
sions combined
with
strong
un. Los
Angeles
is
the
leading example,
but
clearly
Athens suffers
imilarly.
here
is no
doubt that hose
iving
in
such areas
would be
willing
o
pay
for
reductions
n
smog
evels,
nd
Schechter
t
al.
(1989)
estimate hathouseholds
in
metropolitan
Haifa,
Israel,would be willing o pay?12 (?1987) per householdper annum
to
reduce
pollution
levels
by
50%.
It
is difficulto
imagine
that this
would
amount to a
large
total
sum
for
Europe
as a whole
compared
withthe
other
damage
costs,
given
the relative
nfrequency
f
photo-
chemical
smog
in
more
Northerly
limes.
2.5.
The costs
of
abatement
The
Department
of
Environment
stimated
the
costs to the UK of
retrofitting
GW of coal fired
plant
withFlue Gas
Desulphurization
(FGD)
and
all
12
major
coal fired
power
stations
23 GW)
with ow
NOx
burners at
over
?1 bn. It
now seems doubtful
hat more than a small
part
of this
programme
will
go
ahead,
as the
liability
o
install FGD
would make the
privatization
ale
of
the CEGB unattractive.nstead it
appears
that the successor
companies
to
the
CEGB,
Powergen
and
National
Power,
will meet the
emissions tandards
by
a combination f
installing
igh efficiency
as
turbines nd
importing
ow
sulphur
coal.
The impact of this on British Coal will be substantial, nd it is in
interesting
xample
of
how the
(private) cost-minimizing
olution
to
the emissions standards
may
differ rom
centrally mposed
solutions.
The
Government
also intends to
apply
the EC
large
car emission
standards
'as soon as
practical, probably
in the
early
1990s,'
at
an
estimated nnual cost
of
?550
mn.
The second
stage, pplying
o small
Acid
rain
313
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Table 5. Estimates of
costs
of
reducing
SO2
by
various means
Cost
($1989)
per
tonneof SO2
Source Action removed
A
moving
o
low
sulphur gas
oil
2,560
A
moving
o
low
sulphur
fuel oil 640
A Fluidized bed combustors
FBC):
new
boilers 96
existing
2,240
A
Flue
gas
desulphurization
FGD):
new
plant
256
existingplant
640
B Drax FGD newplant 350
C
FGD retrofit
,000
MW
plant
400-750
D
60%
reductionfrom
40
GW CEGB
coal
capacity
600
E FGD
90%
removal
600
E
FGD
marginal
cost
of
next
5%
removal
1,600
F
US
coal
generators,
oal
switching,
v
cost 400
F
US
coal
generators,
no
coal
switching,
v cost 460
G East
Germany,
Wellman-Lord
FGD,
net of S sales 300
H move from
2.15%
to
1%
sulphur heavy
fuel oil 380
H
move
from
1%
to
0.7%
sulphur heavy
fuel oil
825
Sources:A, Environmental esourcesLimited 1983, p. 137,uprated by1.28to$1989).
B,
Based
on
Layfield
1987)
and
Jeffrey
1988).
C,
Longhurst
et
al.
(1987).
D,
Dudley
et al.
(1985,
p.
121).
E,
Brackley
1987).
F,
Congressional Budget
Office
1986)
in
Dowlatabadi and
Harrington
1989).
These are
average
costs.
Marginal
cost
might
be
twice
verage
cost.
G,
Acid
News,
No.
3,
July
1989,
p.
9.
H,
Alfsen
et
al.
(1986).
cars,
was estimated o
add an additional
?250
mn.
per
annum,
a total
of
about
4%
of
UK
motoring
osts.
Department
of
Environment,
988,
7.14-15.)
This
sectionexamines various estimates f the
costs of abate-
ment n
somewhatmore detail to see
if
mandatingparticular
olutions
is
likely
to be cost effective,nd to check on the
consistency
nd
plausibility
f various
estimates.
The
results re summarized n Table
5 and
then
briefly
xplained.
The
sources
of
these
estimates re
as
follows. nvironmental
esour-
ces
Limited
1983)
gives
estimates f the
capital
cost
of FGD at
$175-
200/kW
r
about
15-20%
of the
capital
cost of
the
plant. Retrofitting,
where
practical,
may
increase
this
cost
by
a
further
30-50%.
FGD
reduces thermal
fficiencyy
about
2%
(e.g.
from
36%
to
34.1%)
and
so can increase the
operating
costs
by 10-20%.
the
first
tation
which
the CEGB
plans
to
retrofits Drax A+
B,
which has a total
capacity
f
4,000
MW,
and
which burns
11 mn.
tonnes of
coal
per
annum with
sulphur
content of
1.7%.
If
95%
of this
were
previously
eleased
as
SO2,
theannual
emissions
would
be
178,000
tonnes
S,
or
338,000
tonnes
SO2.
After
fitting
GD,
90%
of
the
SO2
will be
removed,
and the
314
David
Newbery
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reduction n
SO2
would be
287,000
tonnes.
The
Layfieldreport
gives
the
costs
of FGD
as
?17/kW/year,
roken down into
?5
capital,
?2.5
operating
and
?9.5
for
loss
of
thermal
efficiency.
his last
figure
depends
on the cost of coal which has since fallenand
Jeffrey
1988)
estimates he
efficiency
ost as
?6.5.
Using
these
figures
he annualized
cost of
the Drax
programme
would be ?56
mn.,
or about
?200/tonne
SO2
reduction.
Longhurst
et
al.
(1987)
gives
the CEGB's
estimates f
the
cost
of
retrofitting
GD for a
2,000
MW
plant
as
?160
mn.
plus
?35
mn. in
lost
output,
or
?440-740/tonne
of
sulphur
removed from
the
gas
stream
i.e.
?230-390/tonne
SO2
removed).
Dudley
et
l.
(1985,
p.
121)
try
o cost a
programme
o
achieve a
60%
reduction n
SO2
in
UK emissionsfrom ts 40 GW coal-fired apacityusingCEGB data and
data
presented
at the
Layfield
enquiry.
The
levelized lifetime ost
of
sulphur
bated
ranges
from
442/tonne
to
?738
with n
average
value
of
?550,
all
in
?1983.
(The
average figure
s thus
?745
in
?1989,
or
$1,200/tonne
. The costs
per
tonne
SO2
removed would
be abouthalf
this.)
Brackley
1987)
estimates
he cost
of
SO2
removal
using
FGD
as
$1,150/tonne
removed
with
90%
removal,
rising
to
$3,000/tonne
forthe next
5%
removed
n
going
from
90-95%
removal,
n
both cases
using
coal with
1
%
sulphur
content. his
figure
s
very
lose to
Dudley's
estimate.
The
effect
n
the costof
electricityeneration
would
be
about
10-15%
of the cost
of
generation
from oal-fired
ower
stations,
r
possibly
%
of the
price paid by
customers.9
his can
usefully
be
compared
with
the
predicted
size
of
the
nuclear
evy'
of
11%
of the
sales
price,
which
will
be
paid by
consumersof
fossil-fuel
enerated electricity
fter
he
privatization
f
the CEGB to cover the
cost of
supplying
20%
of
total
electricity
y
non-conventional
mainly
nuclear)
means.'0
Dowlatabadi and
Harrington
1989),
in a rather
critical ccount of
US estimates f the costsof argeprogrammes o reduce total missions
by
8
mn. tonnes
per
annum from
he
current evels of
25
mn.
tonnes,
cites
various
estimates
of the
average
cost
per
tonne
SO2
reduction.
Thus the
Congressional
Budget
Office
1986)
gives
he
eastcostmethod
of
making
his
reduction
by
allowing
he
utilities
o
choose how best to
meet
the
standards)
as
$360/tonne,
nd
$400/tonne
f
they
must con-
tinue o use
thesame
coal as
originally
nstead
of
substituting
o
ower
ul-
phur
contentcoal.
These are
average
costs,
nd
there s
considerable
I I
9
Based
on
estimated
capital
costs of
100-200/kWe
capacity,
5-7%
discount
rate,
30-40
year
lifetime,
0%
load
factor,
nd
1.7%
sulphur
coal content.The
calculated
figure
s
reassuringly
close to
that
given
n
1984
by
the
CEGB in HMSO
(1984,
para
5.93).
10
This
suggests
he
cost
of
non-conventional
lternative s
55%
of
the
final
price
11%
borne
by
80%
of
the total allocated to the
20%
non-conventional)
which
seems
unreasonably
high.
But
detailed estimates f the cost of nuclear
power
are not
yet
available.
Acidrain
315
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21/51
agreement
that the
marginal
costsof
high
levelsof
sulphur
removal
are
substantially
igher
han
smallreductions.
f
the
marginal
ost
were
twice the
average
cost at
this
programme
evel then the US
figures
would be
close to the CEGB
figures.
stimates
based on
German data
applied
to East
Germany
uggest
hat
the
capital
cost
per
kW
capacity
is DM
600
using
the Wellman-Lord
method."
At
present
the
capacity
of
the
15
larger
plants
is
13.3 GW which s
responsible
for
1.98 mn.
tonnes f
SO2
p.a.
The
capital
ostwould be DM 8
bn.,
and the
estimated
annual cost of
operating
ess
the value of the
sulphur
sold on world
markets would
be
DM
1.6bn.,
or DM
600/tonne
SO2
removed,
or
$300/tonne
O2,
which
appears
rather ow.
An alternative ptionforreducingSO2 emissions stoswitch olower
sulphur
content
fuels. Thus
Alfsen
et al.
(1986)
calculate the cost of
switching
rom
high
to
low
sulphurheavy
fuel oil as
2,300
NOK/tonne
SO2
removed
(i.e. $380)
when
moving
from
2.15%
to
1%
HFO,
and
5,000
NOK/tonne
removed
(=$823)
when
moving
from
1%
to
0.7%
HFO.
Table
5
shows
similar alculations
f
switching
rom
high
to low
sulphur
fuels
for
the EEC
given
n EnvironmentalResources Limited
(1983,
p.
137).
What
stands out
from Table 5 is
the wide variation n
the costs
of
the most common proposed method of dealing with large power
stations-flue
gas desulphurization,
r FGD. In
part
this
variation
may
be
explained by
differing
egrees
of
sulphur
removal estimate shows
that
he
marginal
ost s
sharply
ncreasing.
The East
German estimates
may
be based on lower construction
osts or a more
optimistic
iew of
the
value
of
recovered
sulphur.
The
figures
for
FGD
from
source
A
seem
rather ow when
compared
to other stimates.
Unfortunately
here
are no
European
estimates or the
important
ption
of
shifting
o low
sulphur
oal.
In
part
his s
because,
unlike
oil,
there s no
clearly
efined
worldmarket
price
for he two
grades
of coal thatwould allow a robust
estimate o
be made
of the differentialost
of
shifting
rom
high
to low
sulphur
coal.
The
study
by
Environmental
Resources Limited
(1983)
concludes
that the
estimated
total
damage
caused
by
acid rain
might
be in
the
range
$0.6-4.5
bn.
per
annum,
of
which the
larger part
is
damage
to
buildings,
hen to
forests,
hen to
crops,
withfisheries
egligible.
The
costs f