Economic Evaluation Case Studies (IRP2-WP5)

Overview

This work package is undertaking five case studies to test the integrated economic evaluation framework.  In each case study, we will:

  1. Understand the issue or problem and knowledge gap analysis by collecting and reviewing relevant information (such as benefits, costs, timeframe, major stakeholders, regulatory framework, current business model, etc.);
  2. Assess the potential of benefit transfer to use existing data. If required, conduct original studies to estimate non-market values, collect cost data from agencies and workshop economic analysis methods and data requirement with relevant stakeholders;
  3. Conduct economic evaluation (benefit-cost analysis) of several alternatives or options, and;
  4. Engage with end users to understand the feasibility of implementing various options and generate a set of recommendations for the implementing organisations.

Greening the Pipeline (GTP) is a flagship liveability improvement project for Melbourne Water in partnership with Wyndham City Council, City West Water, and Vic Roads.  The project aims to determine how best to improve liveability and environmental outcomes through restoration activity and parkland construction works along a 27km linear section of the heritage listed Main Outfall Sewer. This Case Study will assess the economic, environmental, and social benefits of an on-ground liveability improvement pilot project – Williams Landing.  In this case study we will undertake to provide quantifiable economic justification for investment spending that targets activities that improve liveability.

A Scoping Workshop was conducted to enable all the 'Greening the Pipeline' project team, key stakeholders, and the IRP2 research team to further understand the GTP project and how it fits into the IRP2 project.  This scoping workshop initiated the process for developing a scope for the Greening the Pipeline in Melbourne Case Study.  The workshop agreed on the research questions and clarified the expected outputs.  See Events:  IRP2 Scoping Workshop: Greening the Pipeline in Melbourne.

Wastewater treatment plants (WWTP) are becoming increasingly important to water security and helping to ensure the climate resilience, liveability and sustainability of cities and towns.  In collaboration with the key stakeholders, Water Corporation, City of Nedlands, WESROC group of local governments (Municipalities of Nedlands, Subiaco, Cottesloe, Peppermint Grove, Claremont, Mosman Park), Department of Water, and the WA Planning Commission/Department of Planning, this case study will identify approaches to collaborative planning, evaluating and implementing (including funding) beneficial land uses in the odour buffer of the Subiaco WWTP, also known as the Subiaco Strategic Water Resource Precinct (SWRP). It will provide a model, tools, information and data which can be applied by planners and communities state-wide and nationally.

The case study will consider the following:

  • What are the costs: benefits (market and non-market) of land use options (major land use options are nature conservation, including rehabilitation, sporting and recreation, horticulture and agriculture, commercial and industry).
  • What are the available tools for evaluating land use options / scenarios and what is their level of utility for users.
  • What are the available funding and policy tools (e.g. development /infrastructure contribution schemes, differential rating) to support equitable implementation.

This case study will demonstrate how water sensitive urban design can be implemented in practice, in a location with complex drainage interactions, flooding issues, and complex multi stakeholder agency arrangements.  An integrated economic evaluation framework would help identify and quantify: The costs and benefits associated with converting an open drain into a living stream, where the area is flood prone, and; The ongoing benefits, liabilities, and responsibilities of different stakeholders and the revenue needed for the project to be viable from the perspective of each individual stakeholder, and as a whole.

In collaboration with the stakeholders, including Shire of Mundaring, City of Swan, Department of Water, Water Corporation, Department of Parks and Wildlife (Rivers and Estuaries Division) and developers, this case study will consider:

  1. How can a main drain conversion to Public Open Space via a living stream be incorporated into a future residential development.
  2. How best to allocate the cost and liabilities associated with construction where issues of drainage and flood mitigation are a priority, and legacy issues related to nutrient load need to be considered.
  3. What governance arrangements best facilitate the delivery of water sensitive urban design, where there are multiple stakeholders with varying responsibilities - water utility, water regulator, developer, and local government - and where there is the potential to deliver non market benefits through waterway pollution load reductions.

An initial meeting was conducted in March 2017 to enable all the case study's key stakeholders and IRP2 research team to meet, to further understand the details of the case study, and how it fits into the IRP2 project.  This meeting initiated the process for developing a scope and timeline for the Case Study.  A follow up meeting is scheduled for later in the year.  For further information, see event: Scoping workshop: Case Study on converting an open drain into a living stream in Bellevue (WP5.3)

When water authorities are faced with developing the servicing strategies for major urban infill and redevelopments, an opportunity exists to assess options outside of "business as usual".  These options are principally related to exploring new ideas that enable an integrated solution to creating liveable, water sensitive outcomes.  The Arden-Macaulay case study provides an opportunity to explore benefits associated with infill development, which can be transferable to other infill developments.   It will allow each of the proposed research questions be considered in the context of an integrated solution taking into account the whole of the water cycle.  During this case study, we will develop an improved understanding of benefits, beneficiaries and approaches for valuing of benefits related to an infill redevelopment. This requires an evaluation framework that must overlay multiple agencies with multiple objectives and different financing arrangements.

This case study is in partnership with City West Water, Melbourne Water, City of Melbourne, City of Moonee Valley, Victorian Government (via Victorian Planning Authority), and other indirect stakeholders undertaking infill redevelopments.  The benefits of this project will allow all stakeholders to identify the options, identify the benefits, have clarity about their values and be informed to make rational decisions on servicing the area, including funding for service provision.

Breakout Creek is the last few kilometres of Adelaide’s iconic River Torrens – an artificial channel dug in the 1930s to connect the Torrens directly to the Gulf St Vincent. It's part of Adelaide's landmark Torrens Linear Park, established in the 1980s, but as a weedy, grassed open channel leased for agistment by a local horse club.  It offered little value as an ecosystem or to the community beyond the horse club. In the late 1990s the Torrens Catchment Water Management Board reconstructed 500m of Breakout Creek, relocating horses, creating permanent deepwater pools, improving community access, and planting thousands of native aquatic and terrestrial plants. In the late 2000s the AMLR NRM Board reconstructed the next 700m of river downstream, further improving and extending habitat and accessibility. In the 2010s the AMLR NRM Board is engaging with the community about potential outcomes for the final reach of Breakout Creek to the sea.

In partnership with the Adelaide and Mt Lofty Ranges NRM Board, SA Water, City of West Torrens, City of Charles Sturt and members of the community, this case study aims to provide an evaluation of market and non-market benefits, and provide evidence for a robust business case for the creation of a linear wetland in the third and final reach to the sea, valuing the currently un-monetised benefits to justify the appropriate investment.

Last updated: 2nd Feb 2017