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A Review of the Efficacy and Cost-Effectiveness of On-Farm BMPs for Mitigating Soil-Related GHG Emissions Sandra Yanni Predrag Rajsic Claudia Wagner-Riddle Alfons Weersink September 2018 Working Paper Series – WP 18-05 Institute for the Advanced Study of Food and Agricultural Policy Department of Food, Agriculture, and Resource Economics University of Guelph Sandra Yanni is a Post Doctoral Fellow in the School of Environmental Sciences, Predrag Rajsic is a Resarch Associate in the Department of Food, Agricultural and Resource Economics, Claudia Wagner-Riddle is a Professor in the School of Environmental Sciences, and Alfons Weersink is a Professor in the Department of Food, Agricultural and Resource Economics, all at the University of Guelph, Guelph, Ontario, Canada N1G 2W1. The authors gratefully acknowledge funding for this project through the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA)/University of Guelph Partnership. Anna Chemeris conducted the analysis described in and wrote Chapter 2. We are thankful to Dr. Susantha Jayasundara for sharing his initial analysis of GHG emissions from field crops for the baseline analysis reported in Chapter 2. We are also thankful for the contributed opinions, discussions, and data sources provided by Ian McCormick and Therese Festin of OMAFRA and Dr. Ed Gregorich, Dr. Andrew VanderZaag and Dr. Craig Drury of Agricultural and Agri-Food Canada. Executive Summary The greenhouse gas (GHG) sources and carbon (C) sinks of Ontario’s agricultural soils and the impacts of management practices and potential strategies to reduce emissions and increase sinks are not well-quantified. In addition, there is a need to determine the economics behind different practices to better inform future program design. The objective of this review was to provide a synthesis of the science on the efficacy and cost-effectiveness of best management practices (BMPs) at mitigating GHG emissions and increasing sinks from soils, landscapes, climates and production systems relevant to Ontario. A baseline of nitrous oxide (N2O) emissions from Ontario agricultural land was calculated from the 1990-2016 Census of Agriculture data. The total N2O in 2016 was estimated at 17.2 Gg N2O/y or 2.6 kg N2O-N/ha. Synthetic fertilizer nitrogen (N) and residue-N constituted the major contributors to direct N2O emissions. Corn crops were one of the major contributors to N2O emissions because of the relatively large acreage devoted to corn production and high N- fertilization rates used. The mitigation potential from BMPs on GHGs was assessed quantitatively through the compilation of data ranges from published experimental findings and from meta-analyses. These were then assessed qualitatively by evaluating the consistency of mitigation findings and scrutinizing the data and conditions. BMPs that showed promise based on the reduction of GHGs or the increase of soil organic carbon (SOC) were identified as (in no specific order): • Matching of N rate to crop needs • Use of nitrification inhibitor (NI) or nitrification plus urease inhibitors (NI+UI) • Cover crops (CCs) • Afforestation • Biomass crop • Conservation tillage In addition to the potential for GHG mitigation, the on-farm financial returns generated through the implementation of the above BMPs were assessed based through a literature review. In general, farms for which these BMPs are profitable have adopted them. However, extent of the returns (or losses) to investment for these practices depends on site characteristics and year. Matching N rate to crop needs usually results in a reduction from the conventional rate. That said, for a selected N rate, aspects such as yield response, price, and risk still need to be addressed. N rate reduction is especially important as N fertilization beyond the optimal level for a given crop results in an increase in N2O emissions. The resulting GHG levels from the selected N rate depend on interactions between the N rate and application time, method, and/or type of 2 fertilizer. These interactions are complex and site-specific and further complicated by risk factors such as weather. The rate of N can be reduced through side-dressing. This allows N rates to be adjusted based on crop appearance part way through the season. Technologies to find the site- specific optimal level of N exist but currently have high implementation costs that outweigh the potential benefits for most fields unless those fields exhibit a great deal of variability. Inhibitors, especially NI and NI+UI, have been shown to consistently reduce N2O emissions and lower N leaching and volatilization losses (depending on condition and use), the latter constituting an indirect N2O emission. The few studies on the economics of NI and UI use have shown them to be potentially cost-effective means for GHG mitigation. CCs were selected because they increase SOC, reduce indirect N2O emissions, and recycle N in the soil thus providing a means to potentially reduce fertilizer use. There are general soil health benefits to CCs that are beyond the scope of this review but nonetheless provide an added incentive for their use. These increases in soil health from CCs and complexity in crop rotation are associated with an increase in on-farm profits over time. Afforestation, biomass crops, and short-rotation crops that are harvested for biomass were also found to be promising because of their C sequestration potential which is shown repeatedly in the literature. Their benefits come from a combination of large rooting systems, reduction of tillage and soil management operations, and buildup of soil C. The on-farm returns from afforestation and inter-cropping depend critically on a sufficiently high price for C and/or biomass. The use of conservation tillage (no-till (NT) or reduced tillage) has been shown to improve SOC and in many cases to reduce N2O emissions. This is especially true with reduced tillage. The yield reduction that is usually associated with NT in humid climates was found to be either eliminated or lowered when reduced tillage such as zone-tillage is used instead of NT. While conservation tillage can reduce labour and fuel costs, the potential decrease in average yield and the increase in its variability affect the likelihood of adoption. The profitability of conservation tillage depends on the soil type and crop rotation of the individual farmer. Other BMPs with the potential for GHG mitigation were not reviewed here because there was either not enough data/literature or the data was inconsistent in demonstrating their benefits. 3 Contents A Review of the Efficacy and Cost-Effectiveness of On-Farm BMPs for Mitigating Soil-Related GHG Emissions .............................................................................................................................. 1 Executive Summary .......................................................................................................................2 Abbreviations .................................................................................................................................6 1. Introduction ............................................................................................................................. 9 2. Baseline Agricultural Soil N2O Emissions in Ontario 1990-2016 ........................................ 11 2.1. Methodology .......................................................................................................................11 2.2. Results and discussion ........................................................................................................12 2.3. Conclusion ..........................................................................................................................15 3. GHG Mitigation Effectiveness of Soil BMPs ....................................................................... 16 3.1. Background on nitrogen transformations and cycling in the soil ...................................... 16 3.2. Methodology .......................................................................................................................17 3.3. Nitrogen fertilizer management ..........................................................................................18 3.4. Crop management ...............................................................................................................29 3.5. Soil management and practices ...........................................................................................40 3.6. Manure management ...........................................................................................................47 3.7. Afforestation and tree barriers ............................................................................................51 3.8. Summary of literature review .............................................................................................53 4. Cost Effectiveness of Mitigation BMPs ................................................................................ 57 4.1. Nitrogen fertilizer management ..........................................................................................57 4.2. Crop management ...............................................................................................................64 4.3. Soil management and practices ...........................................................................................69 4.4. Afforestation and tree barriers ............................................................................................74

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