Farm-Level Assessments of Greenhouse Gas Marginal Abatement Cost Curve Emissions: Understanding the Implications of Interactions and Heterogeneity

Mitigation of climate change remains a central focus of the EU; with it’s 2030 Climate Target Plan, the Commission proposes to raise the EU's ambition on reducing greenhouse gas emissions (GHG) to at least 55% below 1990 levels by 2030. In Ireland, GHG emissions from the agricultural sector are high compared to other developed countries at 37.1% of total greenhouse gas emissions (GHG). Extensive efforts have been brought to bear on the development and evaluation of mitigation measures that reduce greenhouse gases from the agricultural sector. However, the extent to which mitigation measures reduce GHG emissions at the farm level has received less attention, most especially the implications of farm heterogeneity on optimal emission reduction. Using EU Farm Accountancy Data Network data for the Republic of Ireland in 2020, this study uses Marginal Abatement Cost Curve (MACC) analysis to assess a suite of GHG mitigation measures and accounts for interaction and heterogeneous effects across 5 different farm system types. The result of the study shows that crude protein in animal diets is the most cost-effective measure for all the farm systems. While liming and protected urea are cost-effective measures for all the farm systems on the other hand some measures fluctuate in their categorisation. The findings show that no two MACC curves across farm systems are the same, that is the rankings of measures change from one farm system to the other. The combination of mitigation measures to reduce GHG emissions may not necessarily yield a cost-effective outcome.