Technical insights from Effect

— Climate change is expected to lead to more frequent and severe fluvial flood events in Northern Europe. Nature Based Solutions are increasingly recognised as a natural insurance against flood risks in vulnerable areas. This requires collaboration at landscape scale between providers and beneficiaries of flood control. In particular, mechanisms to incentivise owners of land could potentially offer cost-effective ways to reduce damage to urban infrastructure. We conduct a choice experiment among farmers located in the vicinity of a river to assess their willingness to accept a contract that would allow a local Danish municipality to periodically flood farmland to reduce urban flood risks. Results indicate that farmers on average are hesitant about entering into abatement contracts, especially if they have prior experience of crop losses due to extreme weather events. If they were to agree on a contract they would prefer a separate compensation for lost crops; a collective negotiation and higher rather than lower yearly payments. Surprisingly, data did not show a significant preference for or against a requirement to grow flood resistant crops. The results suggest that a contract with a separate damage compensation and based on individual negotiation would on average require an annual payment of 290Euro/ha for farmers with no prior experience of crop losses and 469Euro/ha for farmers who have experienced crop losses. The paper discusses the potentials and limitations of landscape scale Nature Based Solutions for climate adaptation.

ACADEMIC PAPER — This paper focuses on the potential use of insurance as a climate change adaptation mechanism in agriculture. We analyse the attractiveness of a climate risk insurance scheme and the choices farmers face between adaptation via farm management practices and purchase of crop insurance in the market. A choice experiment is used to reveal Danish farmers’ preferences regarding an insurance contract where adoption of land management practices to improve soil sustainability is conditional for obtaining insurance cover in the market. Results indicate that in general arable farmers and farmers with low soil quality who have experienced crop damages in the past are more likely to purchase such conditional insurance. Farmers with good quality soils, who perceive that they have already adapted their practices to climatic risks and who have not experienced losses due to adverse climatic events in the past are less willing to purchase insurance. The paper contributes to the limited knowledge on preferences for climate risk related insurance in agricultural systems in general, and in Europe in particular.

ACADEMIC PAPER — The article raises the problem of time-scale for evaluation of contract effect. It occurs that the positive/negative effect of short term contracts might be overstated because ecosystems and species therein can have differences in the short- and long-term reactions on applied treatments. A case study on grassland management is here presented: a very positive restoration contract results in the first few years, followed by an unsuccessful continuation of the same management under contract umbrella of the agri-environmental support scheme. So, the paper show that the long-term evaluation of contracts is vital.