https://www.cbc.ca/news/canada/windsor/algal-bloom-economic-cost-lake-erie-1.5221597
Algal blooms to cost Lake Erie tourism economy $110M: study
Algal blooms will cost the Lake Erie economy $272M a year over a 30-year
period if left alone
Angelica Haggert · CBC News · Posted: Jul 24, 2019
Results of a economic costs estimate suggest algal blooms will cost the
Lake Erie economy $272M over a 30-year period if left alone.
Results of an economic costs estimate suggest algal blooms will cost the
Lake Erie economy $272 million a year over a 30-year period if left alone.
The tourism sector will be the hardest hit, with a $110 million
equivalent annual cost.
"We knew this problem was damaging," said report contributor Brad Bass.
Bass is also the coordinator of environmental programs for Environment
and Climate Change Canada.
"We had never before been able to estimate exactly what the damage was
to the people affected by the problem most directly," said Bass.
The study, Estimating the economic costs of algal blooms in the Canadian
Lake Erie Basin, was published in the Harmful Algae journal (June 2019)
as a collaboration between economists and Environment and Climate Change
Canada. Bass's role was to put together the team of economists and
answer their questions about the health of Lake Erie.
The team looked at six categories:
Commercial fishing industry.
Water consumers (treatment plants, industrial water users).
Recreational users (boating, fishing, birdwatching, hunting and
beach use).
Tourism (hotels, restaurants and travel).
Property owners.
Non-users.
"These are the sectors that are directly affected if there is damage to
the a lake, or to this lake specifically," said Bass.
In addition to looking at six categories, the report broke down the
economic costs based on two scenarios — doing nothing (business as
usual) or intervening through policy.
"[Business as usual] means we just allow things to continue as they're
continuing now," said Bass. "Basically we don't intervene in the lake in
any way to reduce algal blooms."
To calculate policy intervention economic costs, the authors made
assumptions about how and when suggested policies would kick in.
"[Policy] didn't eliminate the costs, but it had a drastic impact on
reducing the economic impacts of the damage," said Bass.
Cost to the tourism industry
According to the report, the tourism industry is the hardest hit by
damage from algal blooms.
"I didn't know if [tourism] would be number one, but I had a suspicion
it would be high," said Bass about going into the study. "There are so
many opportunities on tourism and a lot of areas that could be
considered tourist areas, even moving 50 or 100 kilometres from the lake."
Over 30 years, the reports estimates the tourism industry's loss, with
policy intervention, is cut to about $28 million.
"It varies sector-by-sector but [policy intervention] is really a better
option, a phenomenal option for the tourism sector," said Bass. "But it
has benefits for all the sectors."
Other industry costs
In a business-as-usual case, the commercial fishing industry on Lake
Erie would be looking at a $93 million loss over 30 years. With
intervention, Bass said that would be cut by two-thirds to almost $34
million.
For property owners, the report shows that there is an economic affect
on properties up to 1.2 kilometres from the shoreline — which takes more
than 24,000 residential properties into affect, with an average value of
$242,000 in 2011. Doing nothing would result in a $712 million loss to
the economy for these property owners. Policy intervention drops that
value to $348 million.
Annually, economic loss from recreational use could expect between a $6
and $21 million loss.
Water users, which include farms, golf courses, industrial facilities
and drinking water facilities saw "negligible" costs except when it came
to drinking water facilities. There are five private drinking water
treatment facilities pulling from Lake Erie, which have already reported
a cost impact due to algal blooms.
A $4 million loss per year in this industry is estimated in the
business-as-usual situation.
What's next
Bass and the other authors completed their analysis and formulated this
report in 2015. Since then, the data has been used as part of the Lake
Erie Action Management Plan, released in 2018.
"That's what we're all working towards, an implementation of that action
plan," said Bass. "So we begin to see some real reductions in the
phosphorous loads."
According to Bass, the estimates uses in the report are "conservative."
"There's a very good chance that the costs would be higher," said Bass,
adding that the cost of not doing anything had never really been calculated.
"We felt it was important to tell people, to tell ourselves what the
cost of the damage is," said Bass. "People who live near the lake are
affected by the fact that this very large, iconic body of water could be
severely damaged."
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