Environmental Valuation & Cost-Benefit News

Abstract: The literature estimating the economic value for water quality changes has grown considerably over the last 30 years, resulting in an expanded pool of information potentially available to support national and regional policy analysis. Using 131 willingness to pay estimates from 18 studies that use a similar definition of water quality, we performed a meta-regression analysis and found mixed results. We find that WTP varies in systematic and expected ways with respect to factors such as the size of the water quality changes, average household income, and use/nonuse characteristics of respondents. As a whole, we conclude that our meta-regression results provide a reasonable basis for estimating expected WTP values for defined changes in water quality. However, despite a large number of existing economic valuation studies, relatively few could be meaningfully combined through meta-analysis due to heterogeneity in the commodities being valued in the original studies. Based on these findings, we provide recommendations for future research, including suggestions regarding more standardized approaches for defining water quality and reporting information in valuation studies.

Keywords: Water quality valuation; Meta-analysis; Meta-regression analysis; Benefit transfer

JEL classification codes: Q2

by George Van Houtven 1, John Powers 2 and Subhrendu K. Pattanayak 1
1. RTI International, 3040 Cornwallis Road, P.O. Box 12194, Research Triangle Park, NC 27709-2194, United States; Telphone: +1 919 541 7150
2. U.S. Environmental Protection Agency, 1200 Pennsylvania Ave., NW, Washington, DC 20460, United States

Resource and Energy Economics via Elsevier Science Direct www.ScienceDirect.com
Volume 29, Issue 3; September, 2007; Pages 206-228
http://dx.doi.org/10.1016/j.reseneeco.2007.01.002

Abstract: There are very few construction and demolition (C&D) waste recycling centres in Brazil. To encourage the building and operation of new units, data were collected and analysed relating to C&D waste management and recycling in Brazil. Based on the results of this analysis, a conceptual model is presented for conducting viability studies of future C&D waste recycling centres.

Applying this model to verify the viability of private recycling centres, the results show that under current market conditions in Brazil, C&D waste recycling centres are not financially feasible based solely on revenue from the sale of processed products. Nevertheless, under the same market conditions, the recycling centres could be economically viable for public authorities depending on the particular circumstances of each municipality. The feasibility, however, depends on continuity and the production volume reached.

The conceptual model, the results of its applications and the discussions about the experiences of existing centres can strongly support public authorities and private initiatives in their decision-making about investments in Brazil and in other developing countries.

by K.R.A. Nunes 1, C.F. Mahler 2, R. Valle 1 and C. Neves 1
1. Department of Production Engineering, Federal University of Rio de Janeiro, C.P. 68507, CEP 21945-970, Rio de Janeiro, RJ, Brazil; Telephone: +55 21 2562 7848; fax: +55 21 2290 6626
2. Department of Civil Engineering, Federal University of Rio de Janeiro, C.P. 68506, CEP 21945-970, Rio de Janeiro, RJ, Brazil

Waste Management via Elsevier Science Direct www.ScienceDirect.com
Volume 27, Issue 11; 2007; Pages 1531-1540
http://dx.doi.org/10.1016/j.wasman.2006.09.007

The Center for Neighborhood Technologies (CNT) Green Values Stormwater Calculator (greenvalues.cnt.org), released in 2007, is designed to arrive at a first approximation of the hydrologic and financial conditions for a site that is defined by the user. In order to calculate the conditions, a variety of assumptions are made. The calculations are based on procedures contained in the report “Urban Hydrology for Small Watersheds,” Technical Release 55, which are commonly used in the Chicago region. (The TR-55 Report)

Based upon the input assumptions several scenarios are characterized on the “Hydrologic” screen, and also shown on the “Financial,” “Financial Detail,” and “Scenario Detail” screens. The cost of a scenario is estimated by calculating the costs of components of the infrastructure and adding them together. Both construction and annual maintenance costs are shown. The annual benefits of a scenario can be found in the same way. An attempt has been made to include financial estimates for each type of benefit, but
many of them have not been quantified.

For simplicity’s sake, only the costs of the stormwater infrastructure components that
change between the green infrastructure and conventional infrastructure scenarios are
utilized. For example, the cost of the rain garden as compared to a turf area of the same size was modeled, but the cost of the remaining turf that makes up the yard was not, because the cost would be the same for both scenarios.

The “Financial” screen includes additional information on how costs or are determined
under the link “See how costs are calculated.” A table in that section gives low, middle and high estimates of construction costs, annual maintenance costs, and component lifespan for each component. In each case, CNT has used the “mid” cost Sources of figures are linked from the estimates, allowing users to investigate and assess what costs are most
appropriate. In many cases there is a direct link to the original source of the costs.

Green Value Stormwater Calculator http://greenvalues.cnt.org/calculator
from the Center for Neighborhood Technology www.cnt.org

Abstract: This paper presents a simple model for assessing the cost-effectiveness of investments in low impact development (LID) for reducing combined sewer overflows (CSOs) in urban watersheds. LID systems, including green roofs, porous pavement, and stormwater treatment wetlands, are site-specific controls for stormwater runoff. If applied throughout a watershed, LID systems like these can reduce the amount of runoff entering the sewer system and reduce CSOs. To be conservative, we focus solely on the function of LID systems as stormwater management techniques, neglecting the other environmental benefits commonly associated with these technologies. A model is presented that can be used to simulate the cost-effectiveness of reducing CSOs through incremental installation of LID technologies across urban watersheds, when they are introduced alone, or in combination with conventional CSO abatement technologies. The potential reduction in CSOs resulting from various levels of LID adoption is simulated using a modified Rational Method. A life-cycle cost analysis is used to compare LID with other alternatives. Given that LID implementation on private property leads to reduced CSOs, a cost sharing scheme is presented that divides the total LID cost into a private cost fraction (born by the property owner) and a public cost fraction (provided by a public agency). The implications of such a policy are discussed with reference to a CSO-shed that drains to the Gowanus Canal (Brooklyn, NY). The results indicate that individual LID systems have differing levels of cost-effectiveness in terms of CSO reduction, but that under a variety of performance and cost scenarios a public subsidy to encourage LID installation represents a cost-effective alternative for public agencies to consider in their efforts to reduce CSOs. Future areas of research in this field are outlined.

Keywords: Urban stormwater; Low impact development; Combined sewers; Cost analysis; New York City

by Franco Montalto 1, 2, Christopher Behr 3, Katherine Alfredo 5, Max Wolf 6, Matvey Arye 3 and Mary Walsh 3
1. Design Dynamics LLC, 220 61st Street, Suite 2B, West New York, NJ 07093, United States
2. The Earth Institute at Columbia University, S.W. Mudd, Room 606A, 500 West 120th Street, New York, NY 10027, United States; Telephone: +1 212 854 3219/201 453 9300; fax: +1 212 8546267
3. The Cooper Union for the Advancement of Science and Art, 51 Astor Place, New York, NY 10003, United States
4. HDR|HLB Decision Economics, 8043 Colesville Road, Suite 910, Silver Spring, MD 20910, United States
5. Department of Civil, Architectural, and Environmental Engineering, University of Texas, Austin TX 78712, United States
6. WernerSobekNewYork, 375 Park Avenue, Suite 1507, New York, NY 10152, United States

Landscape and Urban Planning via Elsevier Science Direct www.ScienceDirect.com
Volume 82, Issue 3; September 24, 2007, Pages 117-131
http://dx.doi.org/10.1016/j.landurbplan.2007.02.004

Abstract: A review of the literature shows that stadiums and arenas are insignificant in terms of creating employment, engendering aggregate increases in local spending, and increasing per capita income levels. Public subsidies, then, may be better justified with reference to the nonpecuniary, public good externalities of professional athletic venues. This research examines whether the public good externalities of Baltimore's Oriole Park and Cleveland's Jacobs Field justify the use of taxpayer resources to finance such projects. This research finds that the public good externalities of Oriole Park and Jacobs Field are determinants of willingness to support the use of taxpayer resources to finance stadium projects.

by Richard W. Schwester; Department of Public Management, John Jay College of Criminal
Justice (CUNY), 445 West 59th Street, New York, NY 10019; rschwester@Jjay.cuny.edu.

Public Budgeting & Finance via Blackwell Publishing www.Blackwell-Synergy.com
Volume 27 Issue 3; Fall, 2007; Page 89-109
http://www.blackwell-synergy.com/doi/abs/10.1111/j.1540-5850.2007.00884.x

On June 7, 2007 The Electric Power Research Institute (EPRI) released the results of an analysis that shows that California can achieve its goals of reducing greenhouse gas emissions to 1990 levels by 2020, but at a cost to the state’s economy.

Depending on how California implements its climate legislation, cumulative real costs to the state’s economy range from 0.2 percent to 1.2 percent ($100 billion to $511 billion) through 2050. In general, costs increase as limits on California’s future greenhouse gas become more stringent, the report says.

For the analysis, EPRI integrated two widely-accepted, advanced economic models: the state-level Multi-Region National (MR) model and a detailed model of the U.S. electricity sector, the North American Electricity and Environment Model (NEEM). The California Environmental Protection Agency and the Air Resources Board are currently using this new EPRI modeling tool for informing their climate implementation work.

“By linking these two well-known economic models in an integrated way, EPRI has developed an important new tool to help society understand how we can achieve significant reductions in future greenhouse gas emissions while minimizing the impact on energy prices and the economy,” said Bryan J. Hannegan, EPRI’s Vice President -Environment.

The EPRI analysis reviewed 20 different policy implementation scenarios, and demonstrated that implementation options based on a broad, market-based cap-and-trade program will likely be more cost-effective than a sector-specific program of command-and-control regulations, or an approach that covers only one part of the state’s economy. Several key issues were highlighted for further study, including leakage of emissions to nearby states, the role of forestry offsets, and the role of electrification as a method for reducing greenhouse gas emissions across the economy.

“Part of EPRI’s role is to provide critical information and strategic guidance for regulators, legislators and electric utilities,” said Larry J. Williams, an EPRI environmental economist who oversaw the project and report completion. “We believe these results provide new insight to guide the state as it weighs its policy implementation options to reduce greenhouse gases.”

For more information about the report, visit www.epri.com

The Electric Power Research Institute (EPRI), with major locations in Palo Alto, California; Charlotte, North Carolina; and Knoxville, Tennessee, was established in 1973 as an independent, nonprofit center for public interest energy and environmental research. EPRI brings together members, participants, the Institute's scientists and engineers, and other leading experts to work collaboratively on solutions to the challenges of electric power. These solutions span nearly every area of electricity generation, delivery, and use, including health, safety, and environment. EPRI's members represent over 90% of the electricity generated in the United States. International participation represents nearly 15% of EPRI's total research, development, and demonstration program.

Electric Power Research Institute (EPRI) www.epri.com
http://my.epri.com/portal/server.pt?open=512&objID=205&PageID=776&cached=true&mode=2&userID=2#

The Electric Power Research Institute (EPRI) today released a study that shows that the aggressive development and implementation of a full portfolio of advanced electricity technologies could reduce the economic cost of cutting future U.S. CO2 emissions by more than 50 percent while meeting the continuing growth in demand for electricity.

“EPRI’s analysis clearly shows that if we can deploy a ‘full technology portfolio,’ we can provide lower-carbon electricity throughout the economy while simultaneously meeting additional demand for electricity due to population growth and economic expansion,” said Steve Specker, EPRI president and chief executive officer.

Previous EPRI work has shown that absent investments in advanced technologies, significant reductions in future emissions of CO2 and other greenhouse gases will result in higher prices for electricity and natural gas, and reduced economic growth.

However, by developing and deploying advanced electricity technologies, such as a “smart” electricity grid, plug-in hybrid vehicles, new advanced nuclear reactors, and clean coal technologies with carbon capture and storage, this EPRI study shows that the same cuts in future U.S. CO2 emissions could be accomplished at much lower cost – saving as much as $1 trillion in future U.S. economic growth under some scenarios analyzed.

The study builds upon prior work in which EPRI estimated the technical feasibility of achieving large-scale CO2 emissions reduction using advanced electricity technologies, and includes new work that identifies the research, development and deployment pathways necessary for these technologies to reach their full potential.

EPRI released its analysis following its annual Summer Seminar, which brings together leaders of the electric power industry, academia, regulators and advocacy groups to address critical industry issues. EPRI will use the study to inform the work of the electricity industry, government and other interested parties in preparing a long-term action plan for research, development and demonstration projects related to these technologies.

The study, “The Power to Reduce CO2 Emissions – The Full Portfolio,” is available in the Newsroom on the EPRI website at www.epri.com.

About EPRI: The Electric Power Research Institute (EPRI) conducts research on key issues facing the electric power industry on behalf of its members, energy stakeholders and society. EPRI was established as an independent, nonprofit center for public interest energy and environmental research. EPRI bring together members, participants, the Institute’s scientists and engineers, and other leading experts to work collaboratively on solutions to the challenges of electric power. These solutions span nearly every area of electricity generation, delivery, and use, including health, safety, and the environment. Its members represent more than 90 percent of the electricity generated in the United Sates, and international participation represents nearly 15 percent of our total research, development, and demonstration program. EPRI has major locations in Palo Alto, Calif.; Charlotte, N.C.; and Knoxville, Tenn.

Source: Electric Power Research Institute www.epri.org Press Release
August 13, 2007
http://my.epri.com/portal/server.pt?open=512&objID=205&PageID=776&cached=true&mode=2&userID=2#

On August 29, 2007 the United States Environmental Protection Agency proposed changes to air quality permitting rules to "encourage pollution prevention; provide increased flexibility, enable industrial facilities to make rapid changes to respond to market demands; save resources for state permitting authorities, and improve public information."

The proposed changes would affect both EPA's operating permits and New Source Review (NSR) programs. Under the proposed changes to the operating permits program, a facility with a flexible permit would explain its operational plans and possible changes to those plans for the duration of the permit term – typically 5 years. The state, local or tribal air quality permitting authority would include permit conditions to ensure protection of public health and the environment for all of those operating conditions. These flexible permits do not provide approval for operational changes not within the scope of conditions considered at the time of the permit application, and facilities would still be required to meet their requirements under the Clean Air Act.

The proposed revisions to the NSR program would govern when advance approvals of certain changes would be appropriate.

EPA and states have been testing many of the flexible permitting approaches for more than a decade. Based on the agency's evaluation of pilot projects, EPA expects that these proposed changes will promote significant environmental and economic benefits, while reducing administrative workload for both permitting authorities and facilities.

EPA will accept comment on this proposed rule for 60 days after it is published in the Federal Register. For more information about the proposal go to http://epa.gov/nsr/actions.html#aug07. Information about EPA's New Source Review program is available at http://epa.gov/nsr/

United States Environmental Protection Agency www.EPA.gov
http://epa.gov/nsr/documents/20070829_flexiblepermits.pdf

Abstract: The discrepancy between transit's large share of local transportation resources and its generally low share of local trips has raised questions about the use of scarce transportation funds for this purpose. We use a regional transport model consistent with utility theory and calibrated for the Washington, DC metropolitan area to estimate the travel benefits of the local transit system to transit users and the congestion-reduction benefits to motorists. We find that (i) rail transit generates congestion-reduction benefits that exceed rail subsidies; (ii) the combined benefits of rail and bus transit easily exceed local transit subsidies generally; (iii) the lowest income group received a disproportionately low share of the transit benefits, both in absolute terms and as a share of total income; and (iv) for practical purposes, the scale of the current system is about optimal.

Keywords: Transit; Transit subsidies; Traffic congestion

by Peter Nelson, Andrew Baglino, Winston Harrington, Elena Safirova and Abram Lipman all of Resources for the Future, Quality of the Environment Division, 1616 P St., NW, Washington, DC, USA

Journal of Urban Economics via Elsevier Science Direct www.ScienceDirect.com
Volume 62, Issue 2, September 2007, Pages 231-251
Special Issue: Essays in Honor of Kenneth A. Small
http://dx.doi.org/10.1016/j.jue.2007.02.001

On August 28, 2007 Fujitsu Computer Systems Corporation today announced the PRIMERGY(R) TX120, the world's smallest, quietest, most energy-efficient tower server. The TX120 measures just 4 inches wide by 13 inches high by 16 inches deep and produces 28 decibels (dB) while idling and 31 dB in operation, approximately 50 percent lower than standard tower servers.

Running in its maximum configuration, the PRIMERGY TX120 consumes between 35 and 40 percent less energy than standard tower servers, saving approximately $100 per server per year (1). At full load, equipped with the Dual-Core Intel(R) Xeon(R) UP processor, maximum power consumption is 163 watts.

Fujitsu www.fujitsu.com
http://www.computers.us.fujitsu.com/www/newsdetail.shtml?nf=07295449.nitf

ABSTRACT: Today, technology-oriented business incubators are a worldwide phenomenon, although empirical research evidence clearly suggests that they tend to fail in supporting entrepreneurship, innovation, and regional development and, therefore, do not fulfil their expected role as policy instrument. The paper focuses on this obvious antagonism. It deliberates upon political rationales, reviews evaluation literatures, and delineates suggestions for the future of the incubation industry. The main conclusion is that technology-oriented business incubators should be run as private organisations without public funding.

by Christin Tamasy; School of Geography, Geology and Environmental Science, The University of Auckland, New Zealand. E-mail: c.tamasy@auckland.ac.nz

Growth and Change via Blackwell Publishing www.Blackwell-Synergy.com
Volume 38, Issue 3; September, 2007; Pages 460-473
doi:10.1111/j.1468-2257.2007.00379.x
http://www.blackwell-synergy.com/doi/abs/10.1111/j.1468-2257.2007.00379.x

On August 27, 2007, Innovest Strategic Value Advisors downgraded its Intangible Value Assessment (IVA) of Ford based on the company's relative performance of social, environmental, and strategic governance (ESG) issues relative to sector peers. On August 28th it upgraded Chevron's IVA Rating

Downloadable reports for companies in the sector and more are available for purchase through Innovest's partner www.csrwire.com/reports/independent

Peter Wilkes, Managing Director at Innovest stated, "Innovest's ratings are an indicator of a company's performance on intangible value drivers and management quality. This information is used to support an investor's existing financial knowledge of a company. It is widely accepted among investors that extra-financial information is now required to get a full understanding of a company's prospects."

By assessing differentials typically not identified by traditional securities analysis, Innovest's IVA ratings uncover hidden risks and value potential for investors. Ratings range from AAA (best) to CCC (worst). Scores on sub factors range from 10 (best) to 0 (worst).

Some of the areas of analysis for companies include:
Supply Chain
Human Rights
Regulatory/Stakeholder relations
Health and Safety
Environmental Strategy and management
Carbon Risk Mitigation
Labor Relations
Product Safety
Workplace issues

Innovest Press Releases via CSR Wire www.CSRwire.com
http://www.csrwire.com/News/9496.html
http://www.csrwire.com/News/9497.html

The OptiPlex 755 will help simplify IT by reducing the number of desk side service visits required for system service and maintenance. Dell is also integrating Intel vPro technology with advanced remote management features that help drive business efficiency. Customers now have the ability to manage systems that are powered down or have no operating system, reducing time spent on patch deployment by up to 94 percent and desk-side service visits by up to 56 percent.1

When desk-side visits are necessary, the number of steps required to remove and replace components on OptiPlex systems can be up to half that of similar Hewlett Packard desktops.

The OptiPlex 755 is available with Energy Smart power settings that can lower energy costs by up to 78 percent.2

Dell is also helping commercial customers who purchase new systems to further reduce their emission footprint associated with electricity used to power IT equipment with its "Plant a Tree for Me" program. Donations to the program support The Conservation Fund and Carbonfund.org, two non-profit partners of Dell that plant trees in sustainably managed reforestation projects.

Dell’s ImageDirect service, available in the United States, is an industry-first service with 12 patents-pending that can reduce the number of software images customers are required to manage in their client environments. It allows customers to create a single master image in up to nine languages with organization-wide applications that can be customized according to departmental needs. When a change is made to the master image, it is made to all. The service can decrease image maintenance cost and speeds time-to-deployment of new systems.

The OptiPlex 755 is available today and starts at $632. For more information, visit www.dell.com/vpro. For details on Dell’s energy-saving strategy, visit
www.dell.com/energy.

Dell www.dell.com
http://www.dell.com/content/topics/global.aspx/corp/pressoffice/en/2007/2007_08_27_rr_000?c=us&l=en&s=corp

The 2007 edition of “Standard Inputs for Cost Benefit Analyses” is now available. In addition to updates of previous information, this edition includes a new study of delay costs, a delay cost model and fleet data from the PRISME service of EUROCONTROL.

It is a requirement that all operational improvements recommended as part of the European Air Traffic Management (EATM) programme should be demonstrated to be economically feasible by means of Cost Benefit Analysis (CBA). This site provides access to a collection of CBA studies carried out for EUROCONTROL programmes and projects. It also provides access to background information including data, methodologies used and the assumptions made. Copies of reports are available for downloading.

EMOSIA is a methodology for cost and benefit analyses of European ATM projects. For details follow the link to the EMOSIA page.

http://www.eurocontrol.int/ecosoc/public/standard_page/cba.html
EuroConrol www.eurocontrol.int

Green Roofs for Healthy Cities, in partnership with the Tremco Roofing and Building Maintenance and the Athena Institute, is pleased to announce the launch of the GreenSave Calculator. The GreenSave Calculator is the first web-enabled Life-Cycle Cost-Benefit tool that enables professionals such as architects, designers, engineers, developers and building owners to compare the short- and long-term costs and benefits of green roofs and conventional roofs.

"For years, we've been researching the multiple benefits of green roofs. Now for the first time we have a practical tool, the GreenSave Calculator, that can incorporate many of these benefits into the decision making process", said Steven Peck, President of Green Roofs for Healthy Cities.
...
"The value of the GreenSave Calculator is that it allows users to be much better informed about the costs and benefits associated with green roofs and conventional roofing systems within a robust life-cycle cost analysis environment," said Jamie Meil, co-founder and director of the Athena Institute. The GreenSave Calculator was designed under the leadership of Ralph Velasquez of Tremco, the members of Green Roofs for Healthy Cities' Life-Cycle Cost-Benefit Sub-Committee, and the Athena Institute. The GreenSave Calculator facilitates detailed comparisons of up to three different roofing options over the defined life-span of the project (typically ranging from 25 to 60 years), providing a more accurate, comprehensive picture of the long range impacts of each option. Among the many elements that can be considered are the life-cycle study period, discount rate, general and energy price inflation, investment cost data, residual or resale value, recurring operating and maintenance and replacement costs. The GreenSave Calculator is also capable of capturing other possible roof benefits such as storm water and heat island mitigation, extended roof durability, related energy costs and savings, development fee savings, marketing benefits, increased rental income and tenant health and productivity improvements that can be ascribed to a roofing system. With the online availability of Version I, the Life-Cycle Cost-Benefit Committee will continue to enhance the breadth and scope of the GreenSave Calculator in the months to come.

Background
Green (vegetative) roofs involve the use of high quality waterproofing, drainage, filter cloth, growing media and plants. Green Roofs for Healthy Cities is an industry association for the green roof industry with over 4,000 Individual and 75 Corporate Members. They are implementing a professional training and accreditation program for green roof designers and installers, provide tools, information and services to their members, and advocate for supportive government policies and programs by working directly with cities. www.greenroofs.org

Headquartered in Beachwood, Ohio, Tremco Roofing and Building Maintenance helps manage building life-cycles while providing roofing and weatherproofing peace of mind to customers in education, healthcare, government, manufacturing and many other industries. In business since 1928, Tremco and its service organization are ISO 9001:2000 certified. To learn more about Tremco, call toll-free at 800/562-2728 or visit our website at: www.tremcoroofing.com.
...
Green Roofs For Healthy Cities www.greenroofs.org
Press Release July 11, 2007; Toronto, Canada
http://www.greenroofs.org/index.php?option=com_content&task=view&id=670&Itemid=113
Steven Peck, President, 416-971-4494, speck@greenroofs.org
Tremco Roofing and Building Maintenance - Ralph Velasquez, Sustainable Technologies Manager, 615-251-3055, rvelasquez@tremcoinc.com

Speakers: Mark Bain, Cornell University; Brad Sewell, Natural Resources Defense Council; Marta Alicia Panero, The New York Academy of Sciences
Sponsored by: Environmental Sciences Section
Moderator: Chris Zeppie, The Port Authority of New York & New Jersey

Achieving restoration in the Hudson-Raritan Estuary depends on a vision for improving the environment for aquatic life and increasing benefits to people. However approaches to valuing these benefits poses difficulties including: defining ecosystem targets, setting performance metrics within a rubric of legal compliance, and utilizing cost-benefit analysis as the primary assessment criteria.

This symposium is part of the United States Society for Ecological Economics (USSEE) NYC Conference Creating Sustainability within our Midst: Challenge for the 21st Century, which will be held from June 23 to June 27. Further information about this conference is available at the USSEE website.

Abstracts

The Nature of Environmental Restoration in the City
Mark Bain, PhD
Cornell University

Environmental restoration is an active and important new pursuit in the City of New York. The common approach to restoration is bringing back a past state when the environment was more natural. New York became a world-class city and center for culture under a forward-looking perspective of building a bigger and better future. Several key agencies are promoting a vision for a "world-class harbor estuary". Can environmental restorationists look forward rather than backward for guidance on what to do? Yes, we can renew our thinking and apply what we know to design a better ecosystem for nature and people.

Planning for a Healthy Jamaica Bay
Brad Sewell, Esq.
Natural Resources Defense Council
Co-chair, Jamaica Bay Watershed Protection Plan

Jamaica Bay has significant and generally underappreciated value to New York City and, for certain environmental parameters, the nation. More than 25,000 acres of open water, marsh, meadowland, beaches, dunes and forests provide critical habitat for more than 80 fish species and many threatened and endangered species, such as the Atlantic Ridley sea turtle. It is a key stopover along the Eastern Flyway migration route and is visited by nearly 20 percent of the continent's species of birds every year. The Bay's wetlands serve as flood protection and shoreline erosion control for the surrounding homes and businesses in Brooklyn and Queens. More than five hundred thousand New Yorkers live in the Jamaica Bay watershed/sewershed, and the Bay is a popular fishing and boating area serving all parts of the City, as well as tourists seeking recreational opportunities.

But Jamaica Bay's resources are in jeopardy. Thousands of acres of the Bay's marshlands are mysteriously disappearing. Scientists predict that, at the current rate, the marsh islands will completely vanish in less than twenty years. Poor, and in some places deteriorating, water quality is a continuing problem for the Bay. Nitrogen from the City's wastewater treatment plants is the leading pollutant, and may even be spurring the marsh loss.

In response to this crisis, in 2005 the City of New York enacted Local Law 71, which requires the New York City Department of Environmental Protection (DEP) to develop a watershed protection plan (Jamaica Bay Plan) "to restore and maintain the water quality and ecological integrity of Jamaica Bay." Local Law 71 also established a seven-member Jamaica Bay Watershed Protection Plan Advisory Committee to advise the DEP in the Jamaica Bay Plan's development. DEP's ongoing development of the Jamaica Bay Plan has helped illustrate the different ecological services provided by Jamaica Bay. DEP has concurrently been developing a nitrogen pollution abatement plan using performance metrics that appear inconsistent with this broader understanding of Jamaica Bay's value. This presentation provides an overview of the Jamaica Bay Plan's development, including DEP's separate development of a nitrogen abatement plan.

Quantifying (Costs and) Benefits for Ecosystem Health: An Example from Pollution Prevention Programming in the NY/NJ Harbor
Marta Alicia Panero
New York Academy of Sciences

This presentation discussed the development of benefits (and costs) associated with a mercury pollution prevention (P2) plan for the NY/NJ Harbor watershed as a case-study example of evaluating ecosystem health on an economically quantified basis. When Cost Benefit Analysis (CBA) is the main assessment criteria to evaluate such a plan, recommending its implementation implies that benefits can be estimated and that they outweigh costs. The techniques for determining benefits are discussed, as well as the difficulties in estimating them, in particular when this involves valuation of environmental services and resources that are not traded in the market. Such limitation leads to a discussion of the shortcomings related to the application of the CBA methodology. An alternative valuation process will be introduced.

New York Academy of Sciences www.nyas.org
http://www.nyas.org/ebrief/miniEB.asp?eBriefID=668#multimedia
http://www.nyas.org/events/eventDetail.asp?eventID=9363&date=6/26/2007%206:30:00%20PM

Abstract: Energy models suggest that the costs of reducing carbon emissions from transportation are high relative to those for other sectors. This paper discusses why taxes (or equivalent permit systems) to reduce passenger vehicle emissions produce large net benefits, rather than costs, when account is taken of (a) their impact on reducing other highway externalities besides carbon and (b) interactions with the broader fiscal system. Both of these considerations also strengthen the case for a tax-based approach over fuel economy regulation, while fiscal considerations strengthen the case for taxes over grandfathered emissions permits. The paper also comments on the practical relevance of automobile fuel taxes, or their policy equivalents, to broader legislation intended to mitigate climate change.

Keywords: Carbon policies; Passenger vehicles; Externalities; Welfare costs

by Ian W.H. Parry; Resources for the Future, 1616 P Street NW, Washington, DC 20036, USA

Journal of Urban Economics via Elsevier Science Direct www.ScienceDirect.com
Volume 62, Issue 2; September, 2007; Pages 273-293
Special Issue: Essays in Honor of Kenneth A. Small
http://dx.doi.org/10.1016/j.jue.2006.12.003

Do greens drive Hummers or hybrids? Environmental ideology as a determinant of consumer choice
Pages 129-145
by Matthew E. Kahn
Abstract: This paper uses several California data sets to test for differences in consumption patterns between greens and browns. A person's “environmentalism” is rarely observed in consumer data sets. In California, a community's share of Green Party registered voters is a viable proxy for community environmentalism. Environmentalists are more likely to commute by public transit, purchase hybrid vehicles, and consume less gasoline than non-environmentalists.

Innovation without magic bullets: Stock pollution and R&D sequences
Pages 146-161
by Timo Goesch and Grischa Perino
Abstract: We study the optimal R&D trajectory in a setting where new technologies are never perfect backstops in the sense that there is no perfectly clean technology that eventually solves the pollution problem once and for all. New technologies have strings attached, i.e. each emits a specific stock pollutant. Damages are convex in individual pollution stocks but additive across stocks, creating gains from diversification. The research and pollution policies are tightly linked in such a setting. We derive the optimal pollution path and R&D program. Pollution stocks overshoot and in the long-run all available technologies produce. Research is sequential and the optimal portfolio of technologies is finite.

Culture and public goods: The case of religion and the voluntary provision of environmental quality
Pages 162-180
by Ann L. Owen and Julio R. Videras
Abstract: Using data from approximately 13,000 individuals in 14 different OECD regions, we find that culture, as expressed by religious beliefs, generates public goods contributions. We characterize individuals into systems of religious beliefs using latent class analysis and find that some types of beliefs influence pro-environment behaviors and attitudes, even after controlling for religious affiliation, political views and activism, and socio-demographic characteristics. We find a role for beliefs that is separate from social capital accumulated via membership in church groups and church attendance. Finally, we make a methodological contribution by showing that the use of latent class analysis to describe systems of beliefs yields more meaningful interpretations than the standard approach of dummy variables for specific beliefs.

Water demand under alternative price structures
Pages 181-198
by Sheila M. Olmstead, W. Michael Hanemann and Robert N. Stavins
Abstract: We estimate the price elasticity of water demand with household-level data, structurally modeling the piecewise-linear budget constraints imposed by increasing block pricing. We develop a mathematical expression for the unconditional price elasticity of demand under increasing block prices and compare conditional and unconditional elasticities analytically and empirically. We test the hypothesis that price elasticity may depend on price structure, beyond technical differences in elasticity concepts. Due to the possibility of endogenous utility price structure choice, observed differences in elasticity across price structures may be due either to a behavioral response to price structure, or to underlying heterogeneity among water utility service areas.

Land use regulation and the provision of open space in suburban residential subdivisions
Pages 199-213
by Erik Lichtenberg, Constant Tra and Ian Hardie
Abstract: We examine the effects of land use and forest conservation regulations on the provision of open space in suburban residential subdivisions. A conceptual model of land allocation within a subdivision is used to show that forest conservation requirements can crowd out other open space while minimum lot size requirements induce developers to substitute private space for public open space. The results of an empirical analysis of land use in suburban single-family residential subdivisions in the Washington–Baltimore corridor are consistent with the predictions of the theoretical model, in particular, crowding out of open space due to forest conservation requirements and minimum lot size zoning. The empirical results also indicate that developers are not influenced by the presence of open space outside of each subdivision, suggesting that developers act to internalize open space amenities rather than attempting to free ride on their neighbors.

Groundwater use under incomplete information
Pages 214-228
by Alexander E. Saak and Jeffrey M. Peterson
Abstract: This paper introduces a game theoretic model of groundwater extraction in a two-cell aquifer under incomplete information. A novel assumption is that individual users have incomplete knowledge of the speed of lateral flows in the aquifer: although a user is aware that his neighbor's water use has some influence on his future water stock, he is uncertain about the degree of this impact. We find that the lack of information may either increase or decrease the rate of water use and welfare. In a two-period framework, the relevant characteristic is the ratio of the periodic marginal benefits of water use. Depending on whether this ratio is convex or concave, the average speed with which the aquifer is depleted decreases or increases when users learn more about the local hydrologic properties of groundwater. In principle, welfare may decrease even in cases when the groundwater allocation is closer to the efficient groundwater allocation.

North–South trade and industry-specific pollutants
Pages 229-243
by Etsuyo Michida and Koji Nishikimi
Abstract: This paper investigates the production and pollution patterns arising from trade between high- and low-income countries when firms discharge industry-specific pollutants. We extend the common pollutant model of Copeland and Taylor [North–South trade and the environment, Quart. J. Econ. 109 (1994) 755–787] to incorporate industry-specific pollutants and obtained a diversified equilibrium, which differs markedly from the complete specialization equilibrium obtained in the original model. With diversified production, individual countries’ shares of production and emissions change in a flexible manner, reflecting the competitiveness of their products in the world market. This result makes it easier for empirical studies to test the theoretical relationships between industrial production/emissions and the different attributes of countries, including income and factor endowment. Despite the striking difference in the equilibrium patterns of production and emissions, the prediction of the Pollution Haven Hypothesis is retained and pollution-intensive industries relocate to South. Finally, a composite of pollutants weighted by disutilities increases in South and decreases in North.

Journal of Environmental Economics and Management via Elsevier Science Direct wwww.ScienceDirect.com
Volume 54, Issue 2; September, 2007; Pages 129-244
http://www.sciencedirect.com/science/journal/00950696

Abstract: This paper reports the findings from a discrete-choice experiment designed to estimate the economic benefits associated with rural landscape improvements in Ireland. Using a mixed logit model, the panel nature of the dataset is exploited to retrieve willingness-to-pay values for every individual in the sample. This departs from customary approaches in which the willingness-to-pay estimates are normally expressed as measures of central tendency of an a priori distribution. Random-effects models for panel data are subsequently used to identify the determinants of the individual-specific willingness-to-pay estimates. In comparison with the standard methods used to incorporate individual-specific variables into the analysis of discrete-choice experiments, the analytical approach outlined in this paper is shown to add considerable explanatory power to the welfare estimates.

by Danny Campbell; Research Fellow in the Gibson Institute for Land, Food and Environment, Queen's University Belfast, Northern Ireland. E-mail: d.campbell@qub.ac.uk for

Journal of Agricultural Economics via Blackwell Publishing www.Blackwell-Synergy.com
Volume 58, Issue 3; September, 2007; Pages 467-483
Danny Campbell
doi: 10.1111/j.1477-9552.2007.00117.x
http://www.blackwell-synergy.com/doi/abs/10.1111/j.1477-9552.2007.00117.x

Abstract: Watershed development is the focus of poverty alleviation programs in rural India. Watershed projects aim to solve problems of externalities, but they also create their own externalities, which cause uneven distribution of costs and benefits that undermine project objectives and harm the poor. Numerous approaches exist to internalize externalities, including awareness creation, moral suasion, investment subsidies, regulatory limits and fines, indirect benefits, mergers, and recent innovations like payment for environmental services and cap and trade. These can be judged on several criteria; the best approach would solve the problem cost effectively and help or at least not hurt poor people. Watershed projects in India were examined to identify the approaches taken to internalize watershed externalities. Investment subsidies and indirect employment benefits are the least effective approaches theoretically, but they are the most commonly applied, most likely because they are easy to administer and bring popular short term gains. Some theoretically favorable approaches that have been used elsewhere, such as payment for environmental services, may not work as well in India due to high transaction costs. However, one key innovation that easily could be applied in India is to make investment subsidies contingent on performance. Legal support and property rights reform would be needed for other favorable approaches.

Keywords: externalities, India, payment for environmental services, poverty, soil conservation, subsidies, watershed

by John Kerr 1, Grant Milne 2, Vasudha Chhotray 3, Pari Baumann 4 and A.J. James 5
1. Michigan State University, 151 Natural Resources Building, East Lansing, MI 48824, USA; Email: jkerr@msu.edu
2. World Bank, Washington, DC, USA
3. University of Manchester, Manchester, UK
4. Independent consultant, Rome, Italy
5. Independent consultant, Gurgaon, India

Environment, Development and Sustainability via Springer Netherlands www.SpringerLink.com
Volume 9, Number 3; August, 2007; Pages 263-281
DOI: 10.1007/s10668-005-9022-3
http://www.springerlink.com/content/l20811vj3q09h183/?p=560e488040d249a08fdd325e438f8215&pi=2

Abstract: Michael Hoy and Julia Witt investigate whether regulations that ban insurance companies from access to individuals' genetic tests are likely to lead to substantial adverse selection costs for the specific example of the so-called breast cancer (BRCA1/2) genes. Using a data set including economic, demographic, and relevant family background information to simulate the market for 10-year term life insurance, they find generally only modest adverse selection costs associated with such a regulatory ban. However, for family background groups that are at high risk for carrying one of these genes, the efficiency cost of adverse selection may be significant should the test become widely adopted.

by Michael Hoy 1 and Julia Witt 2
1. Department of Economics, University of Guelph, Guelph, Ontario, Canada N1G 2W1; mhoy@uoguelph.ca
2. Melbourne Institute for Applied Economic and Social Research, The University of Melbourne, Melbourne, Victoria 3010, Australia.

Journal of Risk & Insurance via Blackwell Publishing www.Blackwell-Synergy.com
Volume 74 Issue 3; September, 2007; Page 523-546
doi:10.1111/j.1539-6975.2007.00223.x
http://www.blackwell-synergy.com/doi/abs/10.1111/j.1539-6975.2007.00223.x

Regulatory agencies have long understood the importance of the government's balancing the costs against the benefits of regulation. The necessity of taking both sides of the ledger into account was emphasized by the creation of the Office of Information and Regulatory Affairs (OIRA) in 1980. The function of OIRA has been precisely to weigh the benefits against the costs of government regulation.

This conference focuses on how cost-benefit analysis has functioned. OIRA Administrator Susan Dudley will give the keynote address. Several past administrators of OIRA including James C. Miller III, Wendy Gramm, Sally Katzen, and John Graham will speak about how cost-benefit analysis has worked, or not worked. More broadly, others who have worked on analyzing government regulation will also participate.

Program Chair
Thi