Contamination of freshwater with micropollutants (MPs) is a growing concern worldwide. Even at very low concentrations, MPs can have adverse effects on aquatic ecosystems and possibly also on human health. Switzerland is one of the first countries to start implementing a national policy to reduce MPs in the effluents of municipal sewage treatment plants (STPs). This paper estimates the benefits of upgrading STPs based on public's stated preferences. To assess public demand for the reduction of the environmental and health risks of MPs, we conducted a choice experiment in a national online survey. The results indicate that the average willingness to pay per household is CHF 100 (US$ 73) annually for reducing the potential environmental risk of MPs to a low level. These benefits, aggregated over households in the catchment of the STPs to be upgraded, generate a total annual economic value of CHF 155 million (US$ 113 million). This compares with estimated annual costs for upgrading 123 STPs of CHF 133 million (US$ 97 million) or CHF 86 (US$ 63) per household connected to these STPs. Hence, a cost-benefit analysis justifies the investment decision from an economic point of view and supports the implementation of the national policy in the ongoing political discussion.
This study examines willingness to pay (WTP) in Bangladesh for arsenic (As) safe drinking water across different As-risk zones, applying a double bound discrete choice value elicitation approach. The study aims to provide a robust estimate of the benefits of As safe drinking water supply, which is compared to the results from a similar study published almost 10 years ago using a single bound estimation procedure. Tests show that the double bound valuation design does not suffer from anchoring or incentive incompatibility effects. Health risk awareness levels are high and households are willing to pay on average about 5 percent of their disposable average annual household income for As safe drinking water. Important factors influencing WTP include the bid amount to construct communal deep tubewell for As safe water supply, the risk zone where respondents live, household income, water consumption, awareness of water source contamination, whether household members are affected by As contamination, and whether they already take mitigation measures.
Since 2007 regulation 1907/2006/EC concerning the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) is in force in Europe to reduce the adverse effects of hazardous chemical substances on human health and the environment. Implementation of the regulation by the European Chemicals Agency (ECHA) is supported by a Socio-Economic Analysis (SEA) Committee, consisting of European experts who help prepare ECHA's opinion on proposals for either restricting or authorizing dangerous substances. This paper presents the outcomes of the SEA underlying the first restriction proposals. Member states proposing a restriction have to show that it will reduce the risks to an acceptable level at a cost which is proportionate to the avoided risk. What is considered proportionate is not clearly defined in REACH. The opinion making process is characterized by many uncertainties: the expert group had no previous experiences to fall back on and limited information about the expected costs and benefits of the proposed restrictions. The study provides insight into expert opinions on environmental and health risks under uncertainty in the specific context of REACH. Particular attention is paid to the confidence experts place on the estimated socio-economic benefits of the avoided risks compared to the estimated compliance costs.
The goal of preserving nature is often in conflict with economic development and the aspirations of the rural poor. Nowhere is this more striking than in native grasslands, which have been extensively converted until a mere fraction of their original extent remains. This is not surprising; grasslands flourish in places coveted by humans, primed for agriculture, plantations, and settlements that nearly always trump conservation efforts. The Umgano grassland conservation and poverty reduction project in KwaZulu-Natal Province, South Africa uses community-based spatial planning to balance the conversion of its lower-conservation value grasslands to a timber plantation, while conserving higher-value grasslands for heritage purposes and managed livestock grazing. Ten years after project launch, we measured the ecological and socioeconomic impacts of the project using Normalized Differential Vegetation Index remote sensing data and over 500 household interviews, as compared with similar non-conserved areas. Zoned management of the Umgano area had resulted in between 9% and 17% greater average peak production in the grassland areas compared to control sites. There was also a 21% gain in incomes for the roughly one hundred people employed by the forestry efforts, when compared to others in their village. Community-based spatial zoning is an overlooked tool for balancing conservation and development but may require, as we found in Umgano, certain critical factors including strong local leadership, an accountable financial management mechanism to distribute income, outside technical expertise for the zoning design, and community support.
The Environmental Liability Directive (ELD) establishes a framework of liability based on the polluter-pays principle to prevent and remedy environmental damage. The ELD requires the testing of appropriate equivalency methods to assess the scale of compensatory measures needed to offset damage. The aim of this paper is to contribute to fill the existing knowledge gap on the application of the value equivalency approach for damage compensation in this context. We analyze the toxic spill damaging the Doñana National Park (Spain) in 1998. The welfare losses associated with the resource damage are estimated using non-market valuation and compared to the value of the compensatory measures taken after the accident. Our results show that the in-kind compensation may have been insufficient to offset the welfare losses. We conclude that a more comprehensive knowledge of the human welfare effects caused by environmental damage is of substantial importance to determine compensatory remediation, as insufficient information in this respect can lead to erroneous decisions causing loss to society.
This paper aims to contribute to the debate on the feasibility of the provision of micro flood insurance as an effective tool for spreading disaster risks in developing countries and examines the role of the institutional-organisational framework in assisting the design and implementation of such a micro flood insurance market. In Bangladesh, a private insurance market for property damage and livelihood risk due to natural disasters does not exist. Private insurance companies are reluctant to embark on an evidently unprofitable venture. Testing two different institutional-organisational models, this research reveals that the administration costs of micro-insurance play an important part in determining the long-term viability of micro flood insurance schemes. A government-facilitated process to overcome the differences observed in this study between the nonprofit micro-credit providers and profit-oriented private insurance companies is needed, building on the particular competence each party brings to the development of a viable micro flood insurance market through a public-private partnership.
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