Land-use change and costs to rural households: a case study in groundwater nitrate contamination

Loss of grassland from conversion to agriculture threatens water quality and other valuable ecosystem services. Here we estimate how land-use change affects the probability of groundwater contamination by nitrate in private drinking water wells. We find that conversion of grassland to agriculture from 2007 to 2012 in Southeastern Minnesota is expected to increase the future number of wells exceeding 10 ppm nitrate-nitrogen by 45% (from 888 to 1292 wells). We link outputs of the groundwater well contamination model to cost estimates for well remediation, well replacement, and avoidance behaviors to estimate the potential economic value lost due to nitrate contamination from observed land-use change. We estimate $0.7–12 million in costs (present values over a 20 year horizon) to address the increased risk of nitrate contamination of private wells. Our study demonstrates how biophysical models and economic valuation can be integrated to estimate the welfare consequences of land-use change.