The European Commission on May 2 approved a plan by the Dutch government that would compensate livestock farmers in certain areas if they agree to voluntarily close their farms as part of the Netherlands’ efforts to reduce nitrogen pollution.
Under the new “schemes,” dubbed LBV and LBV plus, farmers will need to agree to shut down their production capacity definitively and irreversibly and not start the same breeding activity elsewhere in the Netherlands—the second-largest agricultural exporter in the world—or anywhere else within the European Union.
The “schemes” will run until February 2028 and are open to small and medium-sized livestock farmers in “overburdened Natura 2000 areas” in the Netherlands, providing their current nitrogen deposition load exceeds certain minimum levels each year.
In addition, only farmers that can prove they have been constantly producing over the five years before voluntarily closing down production will be eligible for the schemes.
The two Dutch schemes have a total budget of roughly €1.47 billion ($1.62 billion) and are part of the government’s plans to reduce nitrogen deposition in nature conservation areas.
Under the €500 million ($551 million) LBV scheme, farmers will be compensated “up to 100 percent” of the losses they incur by closing down their dairy cattle, pig, and poultry breeding sites, in the form of direct grants, according to a statement from the European Commission.
That compensation will cover the loss of production capacity and production rights, according to the statement; funding, however, depends on the area in which the farm is located.
Under the €975 million ($1.77 billion) LBV-plus scheme, which will be open to “peak-load emitting breeding sites who emit a high level of nitrogen per year, fixed as a minimum level,” including farmers breeding dairy cattle, pigs, poultry, and veal calves, “up to 100 percent” of losses incurred by the farmers will be compensated via direct grants.
However, some farmers may also receive up to 120 percent in compensation due to the loss of production capacity under that scheme, according to officials.
The European Commission noted in its statement that if closures are done owing to environmental reasons, member states may grant the farmers an additional 20 percent “green bonus” on top of the compensation for the loss of the value of the assets.