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Overview: Benefit Analysis in CAFE

Overview: Benefit Analysis in CAFE. Paul Watkiss AEA Technology Environment . Cost:Benefit Analysis in CAFE. Objectives : Monetise environmental benefits of policies Estimates of the costs and benefits of different policy options. What Information from the CBA ?.

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Overview: Benefit Analysis in CAFE

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  1. Overview: Benefit Analysis in CAFE Paul Watkiss AEA Technology Environment

  2. Cost:Benefit Analysis in CAFE Objectives: Monetise environmental benefits of policies Estimates of the costs and benefits of different policy options

  3. What Information from the CBA ? • Analysis of a wider set of quantified benefits of future air quality policy • Human health mortality and morbidity • Building materials • Crops • Monetisation of environmental benefits • Policy test – benefit to cost ratio • Importance of individual pollutants, common units for categories • Information for ‘getting the prices right’ (economic instruments)

  4. Project Tasks Phase 1 Development and Application to Baseline • 1. Developing conceptual framework for the analysis • 2. Development of multi-criteria analysis (MCA) • 3. Ensuring costs and benefits are measured with the same metric • 4. Review/consultations on functions and monetary unit values • 5. Estimating marginal damage of pollutants for 2010, 2015, 2020 (Beta) • 6. Inclusion of costs and benefits at the local scale • 7. Developing framework for social/macro-economic impacts of improved AQ • 8. Creation of a modelling and reporting tool • 9. Preliminary assessments Phase 2 Scenario Analysis

  5. IMPACT CONCENTRATION Conceptional Approach: Impact Pathway EMISSIONS tonnes/year of SO 2 DISPERSION TREMOVE, EMEP, RAINS, etc. Increase in ambient concentrations e.g. ppb SO for all affected regions 2 Stock at risk e.g. inventory building materials IMPACT Using exposure-response curves, e.g. change in building erosion Benefits Model COST Damage costs, WTP estimates

  6. Benefits Model Framework • Bring analysis of different impacts together – quantification and valuation – stock at risk, functions, values • Based around GIS • Take pollution concentration output from RAINS directly • Work at 50 km2 resolution • but also provides way adapting to European and local level (resolution) for cities • Transparent framework – easy to update – sensitivity analysis - not a ‘black box’ • Complemented by MCA for some categories

  7. Health Benefits • Aim to undertake a HIA (Health Impact Assessment) • Includes impacts with high confidence but also new impacts and sensitivity • Progress through to valuation = health dominates overall benefits • Deaths brought forward from ozone • Respiratory hospital admissions ozone and fine particulates • Chronic mortality from fine particulates • Morbidity impacts fine particulates (e.g. effects in asthmatics) • Childhood mortality from fine particulates • Sensitivity analysis on other pollutants, other effects • Chronic morbidity from PM, long-term effects ozone High (WHO) New MCA

  8. Man-Made and Natural Environment • Damage to buildings – corrosion and soiling • Crops • Ecosystems • Cultural Heritage • Other (visibility) • Ancillary (greenhouse gas emissions) • Social (employment, deprivation/inequality) • Economic (employment/growth) Quantified and monetised impact pathway Possible valuation/MCA Outside core analysis Separate analysis or MCA

  9. What by When? • Phase 1 = development and baseline • Methodology complete July 2004 – peer review • Revised and application to baseline September 2004 Methodology outline Dec 2003 Revised methodology March 2004 Draft final methodology Late June 2004 Peer Review July-August 2004 Consultation workshop July 5th Comments Consultation workshop Dec. 2003

  10. Comments Received from December Workshop • Comments at workshop, plus • DG Enterprise (Dominique Simonis & Caroline Hager, Unit E.1 (Environment Aspects of Enterprise Policy)) •  UK DEFRA (Helen Dunn) •  INERIS (Sebastien Soleille) •  Coordination Center for Effects (JP Hettelingh) •  VITO (Rudi Torfs) •  UK Department of Health (Heather Walton)

  11. Comments received on Methodology 2004

  12. Methodology Updates and Open Points • Updated main health analysis so that consistent with WHO review • Meta analysis + follow-up to CAFE questions • Investigating background rates and transferability of morbidity functions • Finalising valuation of mortality (deaths brought forward / chronic). • Valuation workshop in UK (21st June) - two new empirical studies • Discussion with UNECE groups on Crops and Materials • Discussion on Cultural Heritage (Cultural Heritage in City of Tomorrow) • Open. Exact analysis to be carried out in sensitivity analysis

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