INFEWS: U.S.- CHINA: Modeling Interdependent FEW systems in the US and China: Nexus for Sustainability, Markets and Trade of Energy and Agricultural Commodities

West Virginia University Research Corporation, Morgantown WV

Investigators

Abstract

This project was awarded through the "National Science Foundation (NSF) / National Natural Science Foundation of China (NSFC) Joint Research on Environmental Sustainability Challenges" opportunity. The Food-Energy-Water (FEW) Nexus, from a global perspective, contains closely interconnected resource systems of food, energy, and water. As the world's population expands to an expected 9 billion by 2050, there will be an urgent demand to balance different resources, such as hydrocarbon fuels, agricultural products, and fresh water, across these three systems to achieve different goals without putting undue strain on the ecosystems that provide these resources. Innovations in hydraulic fracturing and horizontal drilling have enabled tremendous growth in hydrocarbon fuel extraction from unconventional reservoirs in the US. This growth has significant implications for energy prices, food production, international trade, and management of water resources. Projections indicate that robust natural gas production in the US will continue into the foreseeable future, pulling fertilizer and energy prices down and leading to changes in agricultural production practices. Although irrigation water shortages and/or excess nutrient-contaminated water runoff from agricultural fields have threatened water sources in most agricultural regions in the US, China, and other countries, the impacts of growth in unconventional resource extraction on water resources in agricultural systems have not been studied within the FEW system frameworks. Fertilizer and energy prices are key determinants of crop planting choices, acreage allocation decisions, fertilizer application rates, irrigation water use, and sustainability of water resources in agricultural regions. The goal of this project is to examine the interdependencies between energy policies, natural gas supply, agricultural production, international trade, and sustainability of water resources. This project at West Virginia University, in collaboration with researchers at Zhejiang Sci-tech University in China, combines economic models for natural gas, nitrogen fertilizer, and agricultural commodities with biophysical soil productivity and watershed hydrology models to reflect the interdependent nature of human decisions and natural systems. Additionally, some of the research, education, and outreach efforts pertaining to this project will be accomplished through collaboration with the Chesapeake Bay Project Science and Technology Committee and the West Virginia SPoT program. The unique modeling framework in this project reflects interdependencies between human and natural systems by integrating partial equilibrium economic models, including spatially explicit land use components and international trade, with biophysical models for soil productivity and watershed hydrology. The project expands the scope of prior studies pertaining to the consumptive water use in irrigation and nutrient runoff from agricultural fields to include the impacts of the energy markets and international trade between the US and China, two of the largest trading nations. Econometric commodity market models and price endogenous partial equilibrium models are used to examine the effects of changes in supply, demand, environmental regulation, and trade policy on production decisions and market outcomes. The economic models for commodity markets and international trade are integrated with water quantity and quality models via spatially explicit land use representation. The effects of land use on watershed hydrologic regimes and nutrient loading are formulated using the Environmental Policy Integrated Climate model (EPIC) and the Agricultural Policy/Environmental eXtender model (APEX), respectively. The integrated modeling framework will generate solutions for understanding tradeoffs between FEW system components involving energy markets, agricultural systems, and water resources in the Mississippi River and Chesapeake Bay watersheds. This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.