Open net-pen salmon aquaculture is now an established component of the economy in several regions of coastal British Columbia. Despite the prevalence of salmon aquaculture in these regions, the industry continues to come under scrutiny. Environmentalists and conservation biologists worry about the known and potential environmental impacts of net-pen salmon aquaculture; community leaders and development advocates are concerned about the economic sustainability of salmon aquaculture and its impacts on rural economies, especially those economies that traditionally have depended on the harvest of wild salmon.

Closed tank technology, an alternative to net-pen farming, may offer a solution to a number of important environmental and economic concerns associated with current salmon aquaculture practices. While there is agreement among stakeholders that environmental benefits exist, considerable debate remains over the financial and economic viability of closed tank aquaculture.

Specifically, recent studies question whether closed tank salmon aquaculture is:

• Financially viable (i.e. profitable);
• Financially competitive with current net-pen technology; and
• Economically superior from society’s perspective.

A careful review, however, finds that reports that specifically assess closed tank salmon aquaculture technologies in British Columbia fall short of providing an accurate and comprehensive assessment of the long-term financial and economic potential of these systems. The following report represents the first stage of an effort to better understand the true economic potential of alternative aquaculture practices in British Columbia. We evaluate existing financial analyses and reports of “proprietary closed tank aquaculture technologies,” and assess the degree to which these reports provide a realistic picture of alternative technologies for salmon aquaculture in British Columbia.

We found four principal issues that limit the usefulness of previous analyses:

• Economies of scale and efficiency improvements are not considered;
• Time horizon analyses are not conducted;
• Sensitivity analyses are lacking; and,
• The economic value of environmental and social impacts are not identified or evaluated.

None of the reports we examined provide sufficient data to expand the original analyses to address these shortcomings.

Based on our initial analysis of these reports, we conclude that existing reviews are insufficient to determine the true financial and economic potential of closed tank technologies for salmon aquaculture in British Columbia. Furthermore, shortcomings in these analyses systematically tend to diminish the potential performance of these systems.

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Closing in on Environmentally Sound Salmon Aquaculture: A Fresh Look at the Economics of Closed Tank Systems