Further description:- United Kingdom  Cost benefit analysis 

Glossary Entry:- United Kingdom  Cost benefit analysis
A form of economic analysis in which costs and benefits are converted into monetary values for comparison 
Overview
Remediation problems can be complicated.  There may be a range of options, the most appropriate of 
whichis not so obvious to decision-makers. The aim of cost benefit analysis (CBA)is to consider the
diverse range of impacts that may differ from one proposed solution to another such as the effect on
human health, the environment, the land use, and issues of stakeholder concern and acceptability
by assigning values to each impact in common units. Monetary or quantitative values may not be appropriate for all issues, so CBA can involve a combination
of qualitative and quantitative methods. Many practioners use a wide definition of CBA, encompassing
a range of formal and semi-formal approaches. It is important to include a sensitivity analysis step,
particularly where this encourages decision-makers to question their judgements and assumptions
through the eyes of other stakeholders.
1. General Approach
In the UK the Model Procedures developed by Defra and the Environment Agency provide a technical framework 
for applying a risk management process to land affected by contamination. Cost benefit analysis
plays a part directly in 'options appraisal': the identification of the optimal approach to risk
management for the site in question. The aim of options apprisal is to determine an appropriate and
cost effective remediation strategy. Whether a particular type of remedial action or combination
of remedial measures, is appropriate and cost effective for the circumstances under consideration
will depend upon a number of factors including: • The requirements for risk management – the identified risks and objectives • The site conditions (e.g. the physical and technical constraints) • costs and benefits (e.g. capital and operational costs) • local and wider environmental consequences (e.g. noise, dusts, emissions) • regulations • social and political factors The Model Procedures suggest that at both outline and detailed planning stages a remediation strategy
should be checked to ensure that continues to meet site-specific objectives and is acceptable on cost–benefit grounds. A useful first check is to confirm that the proposed remediation
strategy will deal effectively with all of the relevant pollutant linkages identified in the conceptual model defined at the beginning of options appraisal. This should
be followed by re-assessment of the combined strategy using the evaluation criteria already established
and a finalised cost–benefit analysis based on revised cost estimates.
 
2. Policy and Regulation
2.1 Policy
The Government's objectives with respect to contaminated land are:    
    
(a) to identify and remove unacceptable risks to human health and the environment;    
    
(b) to seek to bring damaged land back into beneficial use; and    
    
(c) to seek to ensure that the cost burdens faced by individuals, companies and society as a whole 
are proportionate, manageable and economically sustainable. These three objectives underlie the 'suitable for use' approach to the remediation of contaminated
land, which the Government considers is the most appropriate approach to achieving sustainable
development in this field. Limiting remediation costs to what is needed to avoid unacceptable risks will mean that the UK will
be able to recycle more previously-developed land than would otherwise be the case, increasing its
ability to make beneficial use of the land. This helps to increase the social, economic and environmental
benefits from regeneration projects and to reduce unnecessary development pressures on greenfield
sites. The 'suitable for use' approach provides the best means of reconciling the UK's various environmental,
social and economic needs in relation to contaminated land. Taken together with tough action to prevent
new contamination, and wider initiatives to promote the reclamation of previously-developed land,
it will also help to bring about progressive improvements in the condition of the land which we pass
on to future generations. Within the 'suitable for use' approach, it is always open to the person responsible for a site to
do more than can be enforced through regulatory action. For example, a site owner may plan to introduce
at a future date some new use for the land which would require more stringent remediation, and may conclude
that, in these circumstances, it is more economic to anticipate those remediation requirements.
However, this is a judgement which only the person responsible for the site is in a position to make.
The one exception to the 'suitable for use' approach to regulatory action applies where contamination
has resulted from a specific breach of an environmental licence or permit. In such circumstances,
the Government considers that it is generally appropriate that the polluter is required, under the
relevant regulatory regime, to remove the contamination completely. To do otherwise would be to
undermine the regulatory regimes aimed at preventing new contamination. Cost–benefit analysis is an inherent part of the management of environmental risks in a sustainable
way, and is a formal component of particular stages of regulatory regimes. It allows for the structured
and transparent balance of the costs (usually, but not always, in financial terms) against benefits,
which can be wide-ranging depending on the context – for example, enhanced health and environmental
protection, increased commercial confidence in the condition of the land or simply greater certainty
in ultimate decision making.
 
2.2 Regulation
UK legislation on contaminated land is contained primarily in the    
* Section 57 of the Environment Act 1995 which introduced a new Part IIA into the Environmental Protection 
Act 1990, and the * Town and Country Planning Act. These are supplemented by statutory and non-statutory guidance (See UK country overview pages on EUGRIS) Under Part IIA where an authority is identifying remedial actions itself, it is specifically required
to ensure that they are 'reasonable', having regard to the cost which is likely to be involved and the
seriousness of the harm or of the pollution of controlled waters concerned. In general any remediation
that can be required must be 'reasonable', having regard to the cost which is likely to be involved
and the seriousness of the pollution of water or harm caused. Assessment of costs and benefits allows comparisons between different remedial options based
on the outcome of the remediation investment. Cost benefit analyses consider the diverse range of
impacts that may differ from one proposed solution to another such as the effect on human health, the
environment, the land use, and issues of stakeholder concern and acceptability on the basis of common
units. In many instances, it is difficult to attach a strictly monetary value to many effects of a remediation
project. Hence assessments can involve a combination of qualitative, formal cost benefit analysis
(CBA) and multi-criteria analysis (MCA) methods. While there are no formally precribed cost benefit analysis (CBA) procedures in the UK, guidance
has been produced by the Environment Agency. This suggests a sequential approach, where increasing
levels of detail are considered. Assessment can be limited to the minimum level of detail necessary
for clear distinctions to be apparent. Findings should be tested by a sensitivity analysis that assess
the impacts of changes in the various input parameters on the analysis. This is important because
the assessments include scoring techniques based on expert judgements, which are at some level subjective.
In theory CBA can encompass most of the diverse issues in decision-making for contaminated land
management (goals, risk management, sustainable development and stakeholder or ‘third party’
concerns). However, CBA valuations and assumptions may not be acceptable or agreed by all stakeholders.
The subjective nature of this process must be borne in mind. The practical usefulness of such an overarching analysis should be considered before it is undertaken,
in particular: (1) of the number and possibly limited transparency of assumptions and judgements
made; (2) difficulties in communication of its findings to all stakeholders; and (3) the ‘added value’
of the analysis compared to the cost of carrying it out.
 
3. Funding
Site Project Funding
Not applicable 
 
R&D funding
Soil Protection
Research Type: Applied

Topics: Brownfields Contaminated land, Contaminated land overview Contaminated land, Remediation options, Remediation options overview Groundwater protection, Groundwater protection overview Soil, Soil Overview

Submitted by: Maike Hauschild  Who does what?

Full Details |


Soil Biodiversity Programme
Research Type: Basic

Topics: Brownfields Contaminated land, Contaminated land overview Contaminated land, funding Soil, Soil Overview

Submitted by: Maike Hauschild  Who does what?

Full Details |


URGENT (Urban Regeneration and the Environment)
Research Type: Basic

Topics: Brownfields Contaminated land, Contaminated land overview Contaminated land, funding Groundwater protection, Groundwater protection overview Soil, Soil Overview

Submitted by: Maike Hauschild  Who does what?

Full Details |


'Infrastructure and Environment' programme and 'Engineering' programme
Research Type: Basic

Topics: Engineering, Infrastructure and Environment, Brownfields, Contaminated land, Groundwater protection, Funding, Brownfields Contaminated land, Contaminated land overview Contaminated land, funding Groundwater protection, Groundwater protection overview

Submitted by: Maike Hauschild  Who does what?

Full Details |


Bioremediation LINK Programme
Research Type: Applied, Basic

Topics: (1) To understand and exploit natural attenuation in groundwater and soil (demonstration, modelling, prediction, definition of operating window). (2) To improve engineered in-situ bioremediation, interfacing microbiology with engineering and hydrogeology; dealing with heterogeneity, improved process control and optimisation. (3) To translate the results of laboratory studies into the field (scale-up). (4) To position bioremediation within a risk management framework - bioavailability, risk-based end points and residue behaviour. (5) To develop the ability to monitor in-situ microbial processes. (6) To understand the constraints on in-situ microbial processes. (7) To integrate bioremediation with other technologies. (8) To quantify human health impacts of bioremediation and develop surrogate testing. (9) To address socio-economic issues- perception of bioremediation technologies and decision-support mechanisms.

Submitted by: Professor Paul Bardos  Who does what?

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Land Contamination
Research Type: Applied

Topics: site assessment for land contamination, decision support tools for risk management, remediation of contaminated soils, sediments, and groundwater, Brownfields Contaminated land, Contaminated land overview Contaminated land, funding Groundwater protection, Groundwater protection overview

Submitted by: Maike Hauschild  Who does what?

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Defra Web Page on: Contaminated Land - funding
Research Type: Demonstration

Topics: There are several measures which support the clean up of contaminated land, and these are described on this web page

Submitted by: Professor Paul Bardos  Who does what?

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Market Information
A large number of UK service providers routinely carry out cost benefit analyses as part of remediation 
strategy development.
 
4: Management tools / decision support and guidance

No further information available

5. Authors


 
    
6. Acknowledgements