A user-driven approach to Cost-Benefit Analysis in a participatory context

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1 Nordic solutions for robust societies 5th Nordic Conference on Climate Change Adaptation October , Norrköping, Sweden A user-driven approach to Cost-Benefit Analysis in a participatory context Johannes Carolus (jfc@ifro.ku.dk) Søren Marcus Pedersen Søren Bøye Olsen Dias 1

2 Introduction: Cost-Benefit Analysis (CBA) Everything affecting social well-being Administration Costs Implementation Costs Maintenance Costs Lost/Reduced Income Ecosystem Services Fisheries and Aquaculture Biodiversity Preservation Flood Risk Reduction Carbon sequestration Nutrient mitigation Erosion/Sediment Control Recreation & Tourism Dias 2

3 The CBA development process Dias 3

4 Geographical locations of the four MIRACLE case study areas Dias 4

5 Results: Assessment Framework, Helge River catchment Pathway 1 Pathway 2 Pathway 3 Dias 5

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8 Concluding remarks Bottom-up CBA (i) benefits from and (ii) supports participatory processes; utilises local knowledge; assesses strategies which are formulated within and adapted to the context of local conditions; More likely to be accepted by the local society; can support policy integration of participative planning outcomes; represents a complement to a top-down CBA; draws on the same economic principles as top-down CBA; entails the same degree of uncertainty as top-down CBA. Sted og dato Dias 8

9 Thanks! ACKNOWLEDGEMENTS: This work was partly carried out in the BONUS MIRACLE project and has therefore received funding from BONUS, the joint Baltic Sea research and development programme (Art 185), funded jointly by the European Union and the Innovation Fund Denmark, Forschungszentrum Jülich GmbH, Latvian Ministry of Education and Science, Polish National Centre for Research and Development, Swedish Environmental Protection Agency, and Swedish Research Council for Environment, Agricultural Sciences and Spatial Planning (FORMAS). Sted og dato Dias 9

10 Back-up Slides Sted og dato Dias 10

11 Results: Management pathways, Helge river catchment Measure Scope Unit Pathway 1 (business as usual) by doser tons/year Liming by boat tons/year by air tons/year Buffer Strips 181 ha Wetlands 210 ha Individual Sewage Emission Reduction to normal level 5431 facilities Reduction from normal to high level 1657 facilities Non-productive field margins in agricultural landscape 300 ha Upgrade or removal of traditional water regulating dams 78 units Total Pathway 2 (restoration of aquatic ecosystems) Urban Stormwater Ponds Flood plain Wetlands Phosphorus Wetlands Riparian Zones Re-Meandering Total ha 150 ha ha ha 400 ha 82.5 km Pathway 3 (sustainable water management in forestry) Alder Swamp Forest Riparian Zones in Forest Landscape Size 1 Fishway or Removal of Migration Obstacle Size 2 Size 3 Culvert Replacement Transition from coniferous to broadleaved forest Total ha 600 ha 3.1 m m 31.3 units 4 units 500 Ha

12 Results: Management pathways and their costs, Selke river catchment Measure Scope Unit Total Costs (Present Values in Million EUR) Pathway 1 (business as usual) Flower and water protection strips (EFA) 0.70 ha 0.0 Ploughing and cropping techniques 1, ha 0.8 Extensive permanent grassland ha 0.9 Organic Farming 1, ha 3.5 Ventilation, treatment & retention of mine water 3.00 implementation(s) 81.0 Dismantling of transverse structures (weir) 2.00 implementation(s) 0.9 Creation of ecological bypassing options 2.00 implementation(s) 0.3 Flood Control Basin Straßberg 1.00 units 18.9 Flood Control Basin Meisdorf 1.00 units 9.9 Total Pathway 2a (target diffuse pollution) Development and management of riparian strips - 10 m ha 1.3 Optimisation of fertilizer use - Reduced N fertilizer by 20% 24, ha -1.1 Contour ploughing 22, ha 0.0 Different adjustments to the morphology and characteristics km 7.7 Total 7.8 Pathway 2b (target diffuse pollution) Development and management of riparian strips - 20 m ha 2.5 Optimisation of fertilizer use - Reduced N fertilizer by 20% 24, ha -1.1 Contour ploughing 22, ha 0.0 Different adjustments to the morphology and characteristics 24, ha 7.7 Total 9.1 Pathway 3a (target point source pollution) Connect 5% of households to sewage plants 1, PE 5.4 Pathway 3b (target point source pollution) Connect 10% of households to sewage plants 3, PE 10.7

13 Experts rating of impacts Table 1 Experts' rating of impacts in Selke River catchment Ecosystem Service Pathway 1 Pathway 2a Pathway2b Pathway 3a Pathway 3b Biodiversity/Habitat preservation Low Medium Medium Low Medium Flood Risk Reduction Medium Medium Medium None/Negligible None/Negligible Carbon Sequestration None/Negligible None/Negligible None/Negligible None/Negligible None/Negligible Erosion/Sediment Control Medium Medium Medium None/Negligible None/Negligible Recreation and Tourism None/Negligible None/Negligible None/Negligible None/Negligible None/Negligible Table 1 Experts' rating of impacts in Helge River catchment Ecosystem Service Pathway 1 Pathway 2 Pathway 3 Biodiversity/Habitat Preservation Medium Medium High Flood Risk Reduction Low Medium High Erosion/Sediment Control Medium Medium High Recreation and Tourism High High Medium Improved surface and groundwater quality Medium Medium High - Dias 13

14 Benefit transfer WTP transferred = WTP study Income transfer red Income study elasticity Source: Czajkowski et al. (2017) Sted og dato Dias 14

15 Monetary benefit values before and after transfer Ecosystem Services Benefit Original Unit Value Transferred Unit Value (to Berze) Transferred Value (to Helge) Source Biodiversity/Habitat Preservation High number of different species of plants and animals, their population levels, number of different habitats and their size in the river ecosystem in the next 10 years. Habitat for endangered and protected species (Forest) 4.6 Zloty [2007]/household/month 8.7 EUR [2016]/person/year SEK [2016]/person/year Birol et al. (2008) 8.0 EUR [2004]/person/year not used SEK [2016]/person/year Landscape diversity (Forest) 4.6 [2004]/person/year not used 14.2 SEK [2016]/person/year Meyerhoff et al. (2009) Species diversity (Forest) 12.5 [2004]/person/year not used SEK [2016]/person/year Improve fish variety from moderate to very high 42.2 SEK [2014]/person/month 15.8 EUR [2016]/person/year SEK [2016]/person/year Provision of Food Recreation and Tourism Improve fish variety from moderate to high Change fish variety from moderate to low 25.5 SEK [2014]/person/month 9.6 EUR [2016]/person/year SEK [2016]/person/year SEK [2014]/person/month EUR [2016]/person/year SEK [2016]/person/year Ek and Persson (2016) Biodiversity Non-use Value - Salmons passing fish ladders (salmon increase between per year) 51.0 SEK [2004]/person/year 2.2 EUR [2016]/person/year 77.2 SEK [2016]/person/year Håkansson (2009) Flood Risk Reduction Access to the riverbank for recreational purpose Reduce flood risk from high to low 6.6 Zloty [2007]/household/month 12.5 EUR [2016]/person/year SEK [2016]/person/year 14.5 Zloty [2007]/household/month 27.4 EUR [2016]/person/year SEK [2016]/person/year Birol et al. (2008) Surface water quality Erosion Prevention Grassland 49.0 Dollar [2007]/ha/year EUR [2016]/ha/year SEK [2016]/ha/year Erosion Prevention Woodlands Dollar [2007]/ha/year not used SEK [2016]/ha/year de Groot et al. (2012) Erosion/Sediment Control Recreation & Tourism Improve water clarity from "moderate" to "clear" Change of water clarity from moderate to turbid and colored SEK [2014]/person/month 35.1 EUR [2016]/person/year SEK [2016]/person/year SEK [2014]/person/month EUR [2016]/person/year SEK [2016]/person/year Ek and Persson (2016) Surface and groundwater quality (Ecological Status) Benefits of Nitrogen (N) and Phosphorous (P) reduction 10.5 EUR (1995)/kg N reduction 21.3 EUR (2016)/kg N reduction SEK [2016]/person/year Interwies et al. (2012) based on Turner et al. (1999)

16 Study-Rating-Conversation Valuation Study Positive Change Status Quo Negative Change Expert rating High Impact Medium Impact Low Impact No Impact Negative Impact Sted og dato Dias 16

17 Results: Costs and Benefits Summary, Helge River catchment (Present Value (PV) in million SEK, 3.5 % social discount rate) Costs and Benefits Pathway 1 ( ) Pathway 2 ( ) Pathway 3 ( ) Total costs , Total benefits , , Costs to Agricultural Sector not applicable Forestry Sector not applicable 0 1, Hydropower Sector not applicable Others not applicable Benefits Biodiversity/Habitat Preservation Flood Risk Reduction Erosion/Sediment Control Recreation and Tourism Water Purification Reduced Water Colouration - 1, , Net Present Value (NPV) , , Benefit-Cost Ratio (BCR)