Ecological Applications, 20(6), 2010, pp. 1542–1555 Ó 2010 by the Ecological Society of America Least-cost control of agricultural nutrient contributions to the Gulf of Mexico hypoxic zone SERGEY RABOTYAGOV, 1,7 TODD CAMPBELL, 2 MANOJ JHA, 2 PHILIP W. GASSMAN, 2 JEFFREY ARNOLD, 3 LYUBOV KURKALOVA, 4 SILVIA SECCHI, 5 HONGLI FENG, 6 AND CATHERINE L. KLING 2 1 School of Forest Resources, University of Washington, Seattle, Washington 98115-2100 USA 2 Center for Agricultural and Rural Development, Department of Economics, 568 Heady Hall, Iowa State University, Ames, Iowa 50011 USA 3 Grassland and Soil Water Research Laboratory, USDA Agricultural Research Service, 808 East Blackland Road, Temple, Texas 76502 USA 4 Department of Economics and Transportation/Logistics and Energy and Environmental Studies Program, North Carolina A&T University, Greensboro, North Carolina 27411 USA 5 Department of Agribusiness Economics, Southern Illinois University, Carbondale, Illinois 62901 USA 6 Department of Economics, Iowa State University, Ames, Iowa 50014 USA Abstract. In 2008, the hypoxic zone in the Gulf of Mexico, measuring 20 720 km 2 , was one of the two largest reported since measurement of the zone began in 1985. The extent of the hypoxic zone is related to nitrogen and phosphorous loadings originating on agricultural fields in the upper Midwest. This study combines the tools of evolutionary computation with a water quality model and cost data to develop a trade-off frontier for the Upper Mississippi River Basin specifying the least cost of achieving nutrient reductions and the location of the agricultural conservation practices needed. The frontier allows policymakers and stakeholders to explicitly see the trade-offs between cost and nutrient reductions. For example, the cost of reducing annual nitrate-N loadings by 30% is estimated to be US$1.4 billion/year, with a concomitant 36% reduction in P and the cost of reducing annual P loadings by 30% is estimated to be US$370 million/year, with a concomitant 9% reduction in nitrate-N. Key words: agricultural conservation practices; evolutionary algorithm; Gulf of Mexico; hypoxia; nonpoint source pollution; Upper Mississippi River Basin, USA; water quality. INTRODUCTION In 2008, the hypoxic zone in the Gulf of Mexico, measuring 20 720 km 2 , was one of the two largest reported since measurement of the zone began in 1985, and the five largest zones have all occurred within the last decade (Louisiana Universities Marine Consortium, available online). 8 The average size of the zone since that time now stands at .13 500 km 2 (Turner et al. 2008). While the scientific understanding of this phenomenon is still progressing, there is consensus that the cause of the Gulf’s hypoxic zone is related to nutrients coming from the watershed of the Mississippi River. Specifically, nitrogen and phosphorous originating on agricultural fields in the upper Midwest, from wastewater treatment plants, and from urban runoff have been identified as important contributors to this seasonal hypoxic zone in the Gulf of Mexico (Turner et al. 2007, U.S. EPA-SAB 2007). There also exists new evidence (Donner and Kucharik 2008) that the federally mandated biofuels goals may further worsen the problems of nutrient export from agriculture to the Gulf. In 2000, an Action Plan established a goal of reducing the hypoxic zone to 5000 km 2 by 2015 (U.S. EPA Mississippi River/Gulf of Mexico Watershed Nutrient Task Force 2008). Progress toward this goal has been limited for several reasons including lack of clear authority to undertake implementation and lack of funding to support control activities. Nonetheless, a number of control methods have been identified, particularly for nutrients coming from agricultural fields. Finding cost-efficient solutions for reducing nonpoint source pollution, such as nutrient reductions from agricultural fields, has been viewed as one of the most challenging problems to solve. Here we focus on the control of nitrogen and phosphorous from the expansive agricultural sector of the Upper Mississippi River Basin. Recent estimates suggest that 43% of the N and 27% of the P flux to the Gulf originate in this region (Aulenbach et al. 2007). The goal of this research is to identify least cost combinations and placement of conservation practices in the region to achieve N and P reductions to the Gulf. To do so, we develop a simulation optimization framework combining water quality modeling with economic data and evolutionary algorithms to derive a Manuscript received 11 April 2008; revised 12 June 2009; accepted 30 September 2009. Corresponding Editor: A. R. Townsend. 7 E-mail: rabotyag@u.washington.edu 8 hhttp://www.gulfhypoxia.net/Overview/i 1542