The Cost of a Green American Dream

by | Oct 23, 2015 | Uncategorized

I recently started taking care of my lawn after years of neglecting it. Unfortunately, no one told me how much effort it would take to keep it up. Before my days of fertilizing and watering grass, I had time to do more important things like binge watching Netflix or taking week-long vacations. With all this free time, I started thinking—with all of the chemicals and water that we’re adding to our lawns, what are the implication on a greater scale?


Let’s take California as an example. It’s not a secret that drought has been a never-ending issue. Several Californian cities are introducing a lawn replacement program that pays residents up to $6,000to replace their lawn grass with fake turf and woodchips. For an average home in the LA area, with a lawn of 7,930 square feet, this subsidy would be approximately $2,625.

What does this mean for a homeowner over a 25-year period? Let’s start by looking at removing your lawn as an investment. The costs for lawn removal in California have been estimated to be between $7,930 and $12,688. The payback period in which the savings would break-even with this cost and bring in profits is 2 years. Based on a water policy report for California, this payback period of 2 years accounts for savings on the water bill, lower expenditures on garden supplies and maintenance. In addition, with the $2,625 subsidy an LA homeowner with an average lawn would have received and removing your lawn would pay itself back in just over a year.

This analysis, however, overlooks the social value of removing your lawn. Not only do lawns require a high consumption of water, but using the lawnmower can bring about environmental externalities such as greenhouse gases and pollution. According to the Environmental Protection Agency, lawnmowers produce more greenhouse gas emissions per hour than 11 cars.

The $2,625 that Californian residents are receiving to remove their front lawnmay sound like a great strategy to get rid of lawns but as the program already ran out of money, it may not prove to be as efficient as expected. In the upcoming release of AutoCASE 2.0we can monetize the total social value of Greenhouse Gases (GHG), Contaminated Air Contaminants (CAC), and conserving water emitted from lawnmowers. The value of reducing air pollutants arises from the improved health outcomes, and avoided damages by climate change, due to reducing just a small amount of each pollutant from the air. The value of reducing the lawn mower emissions, for an average lawn in L.A., sums up to $24.85 per year. However, as California is truly concerned with conserving water, it is useful to look at the water impacts of removing this average sized lawn, which amounts to 309,270 gallons per year! This has a financial value of $643.50. However, water prices often neglect many of the ecosystem services provided by that water. This means that the conservation of this water is undervalued. To assess it at its full value we also need to investigate the social value of conserving this water. This is the sum of the recreational value it provides in the stream, the hydroelectricity it could have produced, and the pollution emitted to transport that water to its end use. Adding all these factors together shows us that the social value of water savings (above and beyond the financial savings) is $63.05 per year. If we add these together, we get a total present value of $1,725 in social benefits from the lawn removal policy.

California’s subsidy overlooked the social value of the project. Given that they’re already out of money, maybe the subsidy of $2,625 was set to high considering the payback period for homeowners is so short. In fact, it could be argued that the optimal subsidy would have been the equal to the social value of the project. If California calculated these social benefits and subsidized $1,725, the program would have been sustainable in the long run and been a cost-effective way to reach more households. Not only does the incentive of $1,725 provide value to the individuals as they also save money on water and landscaping, it provides enough societal value to completely off-set the cost.

However lawnmowers aren’t so bad—after all they’re part of the classic American dream. There is value placed on lawns depending on how people choose to use them—whether it serves as a playground for kids or caters to someone’s gardening hobbies. Looking at green spaces is believed to be stress-relieving, so taking this away would only induce more stress in our lives. Economists call this the “lost consumer surplus” or the lost pleasure that people might suffer if they get rid of their front lawns. If calculated, the lost enjoyment people would feel by not having a front lawn would reduce the social benefit of the lawn replacement program.

How much this lost pleasure will reduce the benefit of replacing lawns is difficult to measure. Nevertheless, its effect can be enough to make people reconsider removing their front lawns. Personally, the enjoyment of looking at a natural, green lawn isn’t enough for me to completely disregard replacing my lawn. I could always buy a couple of potted plants to decorate the house for stress-relief. There are also cost and time savings for individual households to take into consideration when making this decision. The financial factors as well as the time that could be saved for leisureare aspects that all play a factor.

The lost pleasure of not having a lawn can be deducted from the time and cost savings to find the respective reimbursement value for each household. If the new incentive of $1,725 to remove a lawn is greater than this reimbursement value, then people will ditch their lawns. In the case of the Californian subsidy was restructured it should have been set to its social value. That way, it benefits society better as the subsidy would be smaller and last longer. As lost pleasure varies from person to person, each household’s reimbursement value would be different. Lowering the subsidy would cause some people to want to keep their lawn in the end. As California only has limited funds, and they overpaid the first time, the lower subsidy has the potential to reach more total households in the end.

In my case, I value the time, energy, and money saved from removing my lawn far more than the lost pleasure I would experience. Besides, I would be doing the environment a favor and getting paid to do so. How can I say no to that?



Automate your business case with Autocase

Book a demo and leverage our expertise today