Project Summary

The primary objective of this project is an evaluation of the economics of wind machine-based technology for mitigating the impact of frost on apple and cherry production in Michigan. The economic approach used is a capital partial budgeting model with two strategies; the first calculates the annual use cost of capital as a reference point while the other uses a net present value approach. Both start with estimating the capital investment in the wind machine and infrastructure. Frost events are simulated on a daily basis with a temperature-based model to estimate the frequency and severity of cold damage for a given location. Using literature-based assumptions about the expected effectiveness of the frost protection technology, we will develop a series of simulated years with estimated crop yields. We will then compare the difference in net revenues above the costs considered between management approaches including none, wind machine frost protection, crop yield insurance, and the combination of wind machine frost protection and crop insurance. The simulations will be run with climate data from both historical (1981-present) and projected future (2041-2060) time frames. Results from the project should help growers better quantify their current weather and climate-related production risks and help inform decisions regarding capital investment in a common adaptive strategy.