Emissions, Transmission, and the Environmental Value of Renewable Energy

We examine how transmission congestion alters the environmental benefits provided by renewable generation. Using hourly data from the Texas and midcontinent electricity markets, we find that relaxing transmission constraints between the wind-rich areas and the demand centers of the respective markets conservatively increases the nonmarket value of wind by 30 percent for Texas and 17 percent for midcontinent markets. Much of this increase in the nonmarket value arises from a redistribution in where air quality improvements occur—when transmission is not constrained, wind offsets much more pollution from fossil fuel units located near highly populated demand centers. (JEL L94, Q42, Q51, Q53)

Estimation of the Nonmarket Benefits of Agricultural Land Retention in Eastern Canada

We assess the nonmarket value for retention of farmland in the Moncton area of New Brunswick. We examine a number of factors explaining household external values for farmland preservation and expand on previous work by Beasley et al., Bergstrom et al., and Halstead. Our findings indicate that the marginal external benefit of preserving farmland in general in this region is small compared to the market price and that spatial embedding is not automatic in contingent valuation studies.

Accounting for Nonmarket Benefits in Southern Forest Management

Current federal regulations stipulate that national forests must be managed with due consideration of the value of timber and nontimber outputs. Implementation of nonmarket value information in the forest planning process is hampered by incomplete understanding of the conceptual basisand proper use of those values. This paper presents an overview of (1) the basic economic principles underlying nonmarket valuation theory, and (2) the available estimates of nonmarket values produced by southern forests. The main conclusion of the study is that existing nonmarket value estimatesare reasonable for efficiency analysis at regional and national levels but need to be adjusted to specific conditions for planning at smaller spatial scales, such as the forest, ranger district, or watershed level. South. J. Appl. For. 17(2):84-89.

Measuring the Nonmarket Value of Massachusetts Agricultural Land: A Case Study

Agricultural land provides a variety of “nonmarket” services to the Commonwealth, including wildlife habitat, scenic vistas, and recreation. This study utilizes an iterative bidding game to estimate willingness-to-pay of residents of three central Massachusetts counties to preserve state agricultural land. Through the use of these data, estimates of the value of these nonmarket amenities are derived so that a fuller measure of the value of agricultural land can be obtained. This information may be useful to policy makers administering such programs as the Agricultural Preservation Restriction Act (Chapter 780) which are designed to arrest the conversion of Massachusetts farmland to urban uses.