Recycling Irrigation Water on Ornamental Nursery Operations: Could Consumer Premiums Compensate for Grower Adoption Costs?

Abstract

The U.S. nursery and greenhouse industry is facing twin challenges of reduced water availability and increased pressure to mitigate pollution from horticultural production. Water-recycling technology (WRT) has been adopted by some nursery producers to improve crop water productivity and to enhance water supply security. This study estimated the economic feasibility of WRT adoption if producers received some portion of retail price premiums for eco-labeled products. Three annual bedding plants, Geraniums (Pelargonium spp.), Petunias (Petunia spp.), and Chrysanthemums (Chrysanthemum spp.) and three broadleaf evergreen plants, Azaleas (Rhododendron spp.), Holly (Ilex spp.), and Boxwood (Buxus spp.) were analyzed based on their sales in the study region of Virginia (VA), Maryland (MD), and Pennsylvania (PA). Of the eight case study nurseries and two synthesized nurseries examined, five showed increased net costs with recycling. However, in almost all cases for which at least a portion of a retail consumer premium was returned to growers, the premium was adequate to compensate for recycling investment costs.