Direct and indirect energy consumption in farming: Impacts from fertilizer use

Abstract

Indirect energy consumption represents a considerable amount of the energy used in the agricultural sector, but its assessment is not an easy task, due to the several dimensions, including those from dynamic externalities. The direct and indirect energy inputs assume special relevance within the frameworks related to fertilizers used in farming systems. On the other hand, the literature review shows that there is margin for further exploration into these domains for the context in the European Union. From this perspective, the main objective of this study is to quantify the direct impact on energy costs from the use of fertilizers in farming as well as the indirect impact on total energy consumption from the use of fertilizers in the agricultural sector. For this purpose, data were considered for European Union (EU) countries from; the Farm Accountancy Data Network, Eurostat, Food and Agriculture Organization, the World Bank and the International Energy Agency. This statistical information was evaluated through descriptive approaches and panel data econometric methodologies. The results show that the direct impacts on farming energy costs from the use of fertilizers are modest (the energy costs increased by about 0.1% point, when the fertilizer costs grow by 1% point). In turn, the indirect impact on the total energy consumption from fertilizer use in the agricultural sector is null for nitrogen and similar for phosphate and potash (around 0.015% points). The literature review shows that there are few studies addressing direct and indirect energy use in the European Union framework and less so for the farming sector, highlighting the novelty of this research.