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Ecosystem Servicesin the
Cost Benefit Analysis of
flood protection projects
Bart van Linge
Consulate General of the Netherlands in New York
Consulate General of the Netherlands in New York
@NLinNYfacebook.com/NLinNewYork
Content1. Introduction
2. Ecosystem services
3. Flood Protection
4. Cost benefit analysis
5. Different methodologies
6. Conclusions
Intro – ecosystem services – Flood protection– CBA – methodologies - conclusion
Consulate General of the Netherlands in New York
Introduction
Changing emphasis toward Ecosystem services in decision-making processes
Cost Benefit Analysis is the most common tool.
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Source: M-16-01, US Presidents Office, 2015
Intro – ecosystem services – Flood protection– CBA – methodologies - conclusion
Consulate General of the Netherlands in New York
Introduction
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Objectives:
1. How can ecosystem services best be incorporated in a cost benefit analysis for flood protection projects?
2. How do the guidelines for incorporating ecosystem services in a cost benefit analysis differ in the United States and the Netherlands?
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Consulate General of the Netherlands in New York
Ecosystem services
Definition:
Ecosystem services are “the contributions that ecosystems make to human well-being” (source: CICES).
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Source: (Liquete, Piroddi, & Drakou, 2013)
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Consulate General of the Netherlands in New York
Ecosystem services
Classification of ecosystem services:
Provisioning services Raw materials
Fresh water
Regulating services Flood protection
Climate regulation
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Cultural services Recreation Aesthetics
Supporting or Habitat services Habitats for species Nutrient cycling
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Consulate General of the Netherlands in New York
Ecosystem services
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Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Three common classification systems
Millennium Ecosystem Assessment (MA)
The Economics of Ecosystems and Biodiversity (TEEB)
Common International Classification of Ecosystem Services (CICES)
Source: (Liquete, Piroddi, & Drakou, 2013)
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Flood risk
Risk = probability * consequence1
Probability
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Source: USACE
Consequence
𝑃 𝑍 < 0 = 𝑡<𝑠
𝑓𝑟 𝑟 𝑓𝑠 𝑠 𝑑𝑟 𝑑𝑠
Source: Environment & Climate Change Canada
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
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General methodology (simplified)
1. Create alternatives
2. Quantify impacts
3. Monetize
4. Make recommendation
Cost benefit analysis
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Source: Arcadis
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Quantification
Describe alternatives according to:
Landscape
Measurement
…?
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Cost benefit analysis
Source: Arcadis
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Quantification
Type of consequence considered:
Fatalities
Environmental damage (e.g. #m3 of gh gas)
Economic damage (e.g. loss of productivity)
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Cost benefit analysis
Source: Arcadis
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Monetization techniques
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Cost benefit analysis
Source: Arcadis
Method Ecosystem services categories
Provisioning
services
Regulating
services
Cultural
services
Supporting /
Habitat
services
Market prices + +/- +/- -
Cost
approaches
+ + - +/-
Revealed
preference
+/- - + +/-
Stated
preference
- - + +
Based on (Silvis & van der Heide, 2013)
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Methodologies
Rebuild by Design (RbD)
Federal Emergency Management Agency (FEMA)
Norfolk
‘Meerjaren Infrastructure en Ruimte en Transport’ (MIRT)
City of Rotterdam: Bergpolder Zuid
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
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MethodologiesCriteria
1. Are ecosystem services incorporated?
2. What classification system is used?
3. What type of risk reduction is considered?
4. What measurement indicators are used?
5. What type of price indices are used?
6. What type of monetization techniques are used?
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
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Methodologies
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
Criteria RbD FEMA MIRT
Ecosystem services Yes Yes Yes
Classification system None Pre-defined TEEB
Risk type Unidentified Prob. + Cons Unidentified
Measurement indicators None Land type None / land type
Price indices None # acres/year Variety
Monetization techniques None AC / RC / FI / TC /
HP / CV
BT / RC / TC / HP /
CV
National
Toolkit
Regional
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Sample projectsNorfolk – FEMA methodology
Extended FEMA data with data from
Earth Economics and USACE
1. Ecosystem services: Yes (more than FEMA)
2. Classification system: CICES
3. Type of risk: Probability & consequence
4. Measurment indicators: Type of landcover / # households
5. Price indices: Limited / # acre per year
6. Monetization techniques: AC / RC / FI / TC / HP / CV
Regional values
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
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Sample projectsMIRT methodology : City of Rotterdam
(Bergpolder Zuid)
Defined new methodology
based on general MIRT
1. Ecosystem services: Yes (limited)
2. Classification system: None
3. Type of risk: Only consequences
4. Measurement indicators: Type of measurement
5. Price indices: Limited / # measure per year
6. Monetization techniques: AC, FI, TC, HP
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
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Conclusions: different methodologies
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
1. Ecosystem services All
2. Classification system Own / MEA / TEEB / CICES
3. Type of risk Not always considered that ecosystem
services can provide both probability &
consequences reduction.
4. Measurement indicators Landcover: only for land allocation
Measurement: only for urban envir.
5. Price indices Per acre: non-urban envir.
Per household: urban envir.
6. Monetization techniques: Very similar
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Conclusions: generalIncluding ecosystem services in CBA promotes:
Better planning and decision making
Other types of financing / combination of different budgets
Early involvement of stakeholders
Multi-functional, innovative and customized designs
Intro – ecosystem services – Flood protection – CBA – methodologies - conclusion
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Questions
Thank you for listening
