ECONOMIC

EVALUATION OF
ENVIRONMENTAL
IMPACT
SUBMITTED BY:
AANCHAL VIDYASAGAR
HIRANMAYI DIXIT
JAPNEET KAUR
KRITI YADAV
NAMITHA S
SONA SURESH
3
RD
SEMESTER
MASTERS OF LANDSCAPE ARCHITECTURE
SPA, DELHI
Often the importance of ecosystem services is
widely appreciated only upon their loss
INTRODUCTION
o Earth ecosystems provide valuable services supporting human life.

o The exploitation of natural systems, including efforts to modify and manage
them, implies to confront the compromised exchange between real and
potential services, and effects upon their resiliency.

o This impact on ecosystems result in biodiversity losses and to various extend of
social costs.

o The concepts and methods to value ecosystems and biodiversity have
progressively emerged and their roots can be found in the core of economic
theory of value .

o The recent enthusiasm for these analysis appears to have been mostly initiated
by the needs of conservationists that were looking for stronger reasons for
more ambitious policies aiming at protecting the nature and biodiversity.
ECONOMIC EVALUATION
Economic evaluation is a sub-field of economics that is concerned with
environmental issues.

Quoting from the National Bureau of Economic Research Environmental
Economics program:
[...] Environmental Economics [...] undertakes theoretical or empirical studies
of the economic effects of national or local environmental policies around the
world [...]. Particular issues include the costs and benefits of alternative
environmental policies to deal with air pollution, water quality, toxic
substances, solid waste, and global warming.

Ecological economics emphasizes the economy as a subsystem of the
ecosystem with its focus upon preserving natural capital
ECONOMIC EVALUATION
The main AIMS of an economic analysis are to:

Assess whether specific development proposals are desirable on economic
efficiency grounds

To give some value to an ecosystem or a site

Provide a framework for the evaluation of feasible alternatives (options)

Assist in the design of economically efficient environmental mitigation and
protection measures
WHAT AN EIA DOESNT DO:

Provides general information about the potential for adverse
environmental impacts associated with a proposed development, not
detailed quantitative information for design or regulatory purposes
(e.g., could indicate areas where private on-site waste disposal may
become a groundwater problem, etc.).
ECONOMIC EVALUATION
ECONOMIC EVALUATION
ECONOMIC EVALUATION MODEL:
WHY CONDUCT AN ENVIRONMENTAL IMPACT ASSESSMENT?

Promote awareness about the nature of the proposal and potential
impacts on the local environment;

Ensure compliance with all relevant and appropriate environmental
laws and regulations (e.g., storm-water management, compliance
with wetland and floodplain regulations) during construction and
operation of the new development;

Ensure consistent and fair review of development proposals by
applying a systematic review process that includes environmental
assessment;

Provide a forum for exploring alternatives to the proposed
development or strategies to mitigate impacts, if necessary.

ECONOMIC EVALUATION
STEPS FOR ENVIRONMENTAL IMPACT ANALYSIS
(From Community Guide to Development Impact Analysis by Mary Edwards)
1. Define the scope of the Environmental Impact Assessment;

2. Inventory community natural resources, their quality and current
use;

3. Compile and review existing community environmental management
standards and guidelines;

4. Assess the extent and significance of environmental impacts
resulting from the proposed development; and

5. Evaluate the potential cumulative impacts associated with the
proposed development
ECONOMIC EVALUATION
ECOSYSTEMS
WHAT ARE WE ANALYSISNG?
ECOSYSTEMS
The world's ecosystems are capital assets. If
properly managed, they yield a flow of vital
services, including the production of goods (such as
seafood and timber), life support processes (such as
pollination and water purification), and life-fulfilling
conditions (such as beauty and serenity).
ECOSYSTEMS
Biological community that occurs in some locale, and the physical and chemical
factors that make up its non-living or abiotic environment.
Network of interactions among organisms, and between organisms and their
environment, they can be of any size but usually encompass specific, limited
space.
Ecosystems in similar environments have very different characteristics simply
because they contain different species.
Although humans exist and operate within ecosystems, their cumulative effects
are large enough to influence external factors like climate.
Classifying ecosystems into ecologically homogeneous units is an important step
towards effective ecosystem management.


ECOSYSTEMS
Naturally occurring systems In nature which can be aquatic or terrestrial in
nature. Eg: Forests ,Lakes , ponds, or rivers.








Artificial ecosystems are the human modified ecosystems for their own benefits.
They can be aquatic or terrestrial. Eg: Crop field , dam or grasslands.







Imbalance in the ecosystems can cause further environmental impacts.
Study of ecology will be at an individual, population or at a community level.



ECOLOGICAL SERVICES
BIOME DISTRIBUTION
Distribution of biomes majorly depending on the climatic conditions
India Tropical Monsoon Forest




India


ECOSYSTEM


Study of ecology will be at an individual, population or at a community level.



INDIVIDUALS


POPULATION


COMMUNITY

Physiology
Reproduction
Development
Behavior



Habitat
Resource needs
Grp behavior
Population growth
Criteria which limits their
extinction or Abundance.



Interaction of different
Populations
Competition





WHAT CONTROLS AN ECOSYSTEM FUNCTION??


Bottom up control- Increase in the energy at the basic or autotrophic levels
Top down control Predation controls the energy at the lower levels.
Both of these controls are operating at the ecosystem at any time.

Ex: Aswan Dam was primarily built to generate electric power. It produced
power but reduced the fish population in the Mediterranean , increased the
numbers of disease bearing aquatic snails and markedly lowered the fertility of
the Nile.






BIORESERVES
Natural Resources--Non Renewable and Renewable Resources
Economists think of the world as goods ( physical components) and the services
(non physical ) components
Resources are tangible market value
Environmental Resources benefit human life

Ecological Assessment helps to understand:
Rate at which resource of a fixed supply be depleted?
Balance to be maintained at the rate of use and rate of generation?
What are the costs to society of diminished ecosystem functions as a result of
renewable and/or non-renewable resource depletion?
What will be the environmental policies if the resources deplete? Are they
economically viable?
Ecological value of one resource is related to the economic and ecological value
of the other resource.
Eg: Crowded Public area can work better by decreasing no of people or by
increasing the area.
Eg :Stream polluted by agricultural runoff, the benefits from eliminating the
pollution can be compared to costs of actions to reduce the runoff, or can be
used to determine the appropriate fines or taxes to be levied on those who are
responsible









BIORESERVES
Biosphere Reserves

Including the number and
frequency of ecosystems,
species, or genes in a given
assemblage.

The Indian government has
established 18 biosphere reserve
areas in India, which protect the
larger areas of natural habitat.

Not only flora and fauna is
protected but also the human
communities who inhabit these
regions and their ways of life.

Potential sites for biosphere
reserves in India are : Thar
desert, Kavalam, Kanha M. P,
Blue mountain etc.











BIOSPHERES










BIODIVERSITY
Bio -diversity level is a well being of the ecological systems which also dictate
the productivity to humankind of those systems.
Biodiversity is evaluated in terms of biological resources in that area.













BIODIVERSITY


EXTRACTIVE


NON EXTRACTIVE


Fuel wood
Timber
Water
Medicinal plants




Recreation
Education
Employment
Research


ENVIRONMENTAL IMPACT ASSESSMENT

ENVIRONMENTAL IMPACT
ASSESSMENT

ENVIRONMENTAL IMPACT
ASSESSMENT

WHAT IS ENVIRONMENTAL IMPACT ASSESSMENT?
Environmental Impact Assessment (EIA) is a process of evaluating the likely
environmental impacts of a proposed project or development, taking into account
socio-economic, cultural and human-health impacts, both beneficial and adverse.

OBJECTIVES OF EIA
EIA was made mandatory in 1994 under the environmental protection Act of 1986 with
the following four objectives:
Predict environmental impact of projects;
Find ways and means to reduce adverse impacts;
Shape the projects to suit local environment;
Present the predictions and options to
the decision-makers.



ENVIRONMENTAL IMPACT
ASSESSMENT
MATTERS COVERED IN EIA

Description of the proposed activities;
Description of the base environmental and climatic conditions
Analysis of the
land use and land use change,
waste generation
water consumption
power consumption along with the
Social and health impacts
An assessment of air pollution and noise generation.
A risk assessment report and disaster management plan to mitigate adverse
environmental impacts of proposed activity;
An indication of the likely area to be affected by the proposed activity or its
alternatives;
A detailed environmental feasibility report of all the information provided.

PROFFESIONS INVOLVED IN ENVIROMNETAL IMPACT ASSESMENT

Eco-system Management

Air/Water Pollution Control

Water Resources
Management

Flora/Fauna Conservation &
Management

Landscape Planners

Social
Sciences/Rehabilitation


Land use planners

Ecology

Environmental Health

Subject Areas Specialists

Representatives of NGO

Persons Concerned with
environmental issues

ENVIRONMENTAL IMPACT
ASSESSMENT

ENVIRONMENTAL IMPACT
ASSESSMENT








PARAMETERS FOR ASSESEMENT

The EIA should identify, describe and assess the direct and indirect effects
of a project on the following factors:

Human beings
Fauna and flora
Soil, Water & Air
Climate and the landscape
Material Assets
Cultural Heritage
Interaction between all above factors

EIA therefore should have a very strong social dimension

ENVIRONMENTAL IMPACT
ASSESSMENT

The Following Impacts of the Project should be Assessed:

Air:
- Changes in ambient levels and ground level concentrations
due to total emissions from point, line and area sources.
- Effects on soils, materials, vegetation, and human health.

Noise:
- Changes in ambient levels due to noise generated from
equipment and movement of vehicles.
- Effect on fauna and human health.

Water:
- Availability to competing users.
- Changes in quality.
- Sediment transport.
- Ingress of saline water.

Land:
- Changes in land use and drainage pattern.
- Changes in land quality including effects of waste disposal.
- Changes in shoreline/riverbank and their stability.

Biological:
- Deforestation /tree-cutting and shrinkage of animal habitat.
- Impact on fauna and flora (including aquatic species, and
migratory path/route of animals.
- Impact on breeding and nesting grounds.

Socio-Economic:
- Impact on the local community including demographic changes.
- Impact on economic status.
- Impact on human health.
- Impact of increased traffic.

ENVIRONMENTAL IMPACT
ASSESSMENT
ENVIRONMENTAL IMPACT
ASSESSMENT

Which type of projects under go EIA?

Agriculture
Construction (Road networks, Malls, Townships, Dam etc)
Industries
Electrical projects
Waste disposal
Any developmental projects around Protected Areas / Nature Preserves
Clean Development Mechanism CDM projects
ENVIRONMENTAL IMPACT
ASSESSMENT

THE MAIN STEPS IN EIAs PROCESS

SCREENING
to determine which projects or developments require a full or partial impact
assessment study.

SCOPING
to identify which potential impacts are relevant to assess (based on legislative
requirements, international conventions, expert knowledge and public involvement),
to identify alternative solutions that avoid, mitigate or compensate adverse impacts
on biodiversity (including the option of not proceeding with the development,
finding alternative designs or sites which avoid the impacts, incorporating safeguards
in the design of the project, or providing compensation for adverse impacts), and
finally to derive terms of reference for the impact assessment.

ASSESSMENT AND EVALUATION OF IMPACTS AND DEVELOPMENT OF
ALTERNATIVES,
to predict and identify the likely environmental impacts of a proposed project or
development, including the detailed elaboration of alternatives;
ENVIRONMENTAL IMPACT
ASSESSMENT

REPORTING THE ENVIRONMENTAL IMPACT STATEMENT (EIS) OR EIA REPORT,
including an environmental management plan (EMP), and a non-technical
summary for the general audience.

REVIEW OF THE ENVIRONMENTAL IMPACT STATEMENT (EIS),
based on the terms of reference (scoping) and public (including authority)
participation.

DECISION-MAKING
on whether to approve the project or not, and under what
conditions; and

MONITORING, COMPLIANCE, ENFORCEMENT AND ENVIRONMENTAL AUDITING.
Monitor whether the predicted impacts and proposed mitigation measures occur
as defined in the EMP. Verify the compliance of proponent with the EMP, to
ensure that unpredicted impacts or failed mitigation measures are identified and
addressed in a timely fashion
ENVIRONMENTAL IMPACT
ASSESSMENT

ENVIRONMENTALLY SENSITIVE AREAS

Religious and historic places
Archaeological monuments/sites
Scenic areas
Hill resorts/mountains/ hills
Beach resorts
Health resorts
Coastal areas rich in corals, mangroves, breeding grounds of specific species
Estuaries rich in mangroves, breeding ground of specific species
Gulf areas
Biosphere reserves
National park and wildlife sanctuaries
Natural lakes, swamps, Seismic zones tribal Settlements
Areas of scientific and geological interests
Defense installations, specially those of security importance and sensitive to pollution
Border areas (international)
Tiger reserves/elephant reserve/turtle nestling grounds
Habitat for migratory birds
Lakes, reservoirs, dams
Streams/rivers/estuary/seas
Railway lines
Urban agglomeration



ECONOMIC EVALUATION

ENVIRONMENTAL IMPACT
ASSESSMENT
ECONOMIC EVALUATION
ENVIRONMENTAL VALUATION

Conceptual background
o Its purpose is to ascribe a monetary value, which permits financial and
environmental impacts of a project to be viewed in a common unit of account.
o In particular the environmental impacts of interest may have implications in
actual markets (market values) or may affect resources that are not traded in
markets but still contribute to human wellbeing (non-market values).
o This means that environmental impacts either positive or negative - can be
directly traded-off with other costs and benefits in a project appraisal or
evaluation context.
ECONOMIC EVALUATION
ECONOMIC EVALUATION
Use value involves some interaction with the resource, either directly or
indirectly:
Direct use value: Individuals make use of a resource in either a consumptive
way or a non-consumptive way.
Indirect use value: Individuals benefit from ecosystem services supported by a
resource rather than actually using it .
Option value: Not associated with current or planned use, individuals derive
benefit from keeping open the option to make use of some aspect of the
natural environment in the future.

Non-use value is associated with benefits derived simply from the knowledge
that the natural environment is maintained. Users of a resource may also attribute
non-use value to it.
Altruistic value: Derived from knowing that contemporaries can enjoy the
environmental goods and services.
Bequest value: Associated with the knowledge that the environmental
resources will be passed on to future generations.
Existence value: Derived simply from the satisfaction of knowing that the
environmental good continues to exist, regardless of use made of it by oneself
or others now or in the future.


ECONOMIC EVALUATION
Valuation methods
Various techniques differ in their applicability to different environmental resources
and the extent to which they can capture the full change in total economic value.

Revealed preference techniques
They concentrate on the analysis of direct and indirect use values, through the
observation of individual behaviour. As for the above approaches non-use values
cannot be estimated by these techniques:
o Hedonic property pricing: It is based on the notion that the price at which a
property sells is determined, in part, by the environmental characteristics of
the surrounding location.
o Travel cost method: It is a survey based technique that uses the costs incurred
by individuals to travel and gain access to a recreation site as a proxy for the
recreational value of that site.
o Averting demand model: It is willingness to pay for the reduction on health
due to environmental impact.
o Market price method: It consider the costs that arise in relation to the
provision of environmental goods and services which may be observed directly
from actual markets.
ECONOMIC EVALUATION
Stated preference techniques
They are the only approaches that can estimate total economic value of an
environmental good of service by estimating both use and non-use values:
o Contingent valuation: The approach entails the construction of a hypothetical,
market via a questionnaire where respondents answer questions concerning
what they are willing to pay or willing to accept as compensation for a specified
environmental change.
o Conjoint/Choice modelling: Choice modelling is based around the notion that
goods and services can be described in terms of their attributes and the levels
that these characteristics take.
ECONOMIC EVALUATION
Secondary Approach:

Benefit Transfer- Boyle and Bergstrom (1992) define a benefit transfer as the
transfer of existing estimates of non-market values to a new study which is
different from the study for which the values were originally estimated. The
attraction of benefit transfer is that it is less costly than conducting a new study.
However, benefit transfer should always be used with caution and with clear
description of degree to which the primary estimates being transferred are
suitable for the current application
Benefit transfer approach generally involves the following steps:
Select existing literature.
Transfer the estimates and adjust values
Discuss uncertainty

Cost-based Methods- Methods based on costs may be used as an alternative way
to monetize environmental conditions, though they are different from the primary
valuation approaches. As costs are often readily observable, they may be used as
proxies for economic values. However, costs may greatly exceed the value if
society makes a decision to restore a natural condition at great cost.
ECONOMIC EVALUATION
Rapid Appraisal Methods
Rapid appraisal methods are quick, low-cost ways to gather data systematically
in support of managers' information needs, especially questions about
performance. They fall on a continuum between very informal methods, such as
casual conversations or short site visits, and highly formal methods, such as
censuses, surveys, or experiments. They share some of the properties of both and
that is their strength as well as their weakness.
Strengths of rapid appraisal methods include the following:
They are relatively low-cost.
They can be quickly completed.
They are good at providing in-depth understanding of complex socioeconomic
systems or processes.
They provide flexibility.
Rapid appraisal's limitations:
They have limited reliability and validity.
They lack quantitative data from which generalizations can be made for a
whole population.
Their credibility with decision-makers may be low.

APPLICATION OF ECONOMIC EVALUATION
ECOTOURSM
how can tourism be developed in a way that generates revenue while also
protecting the ecological integrity? The solution to is Ecotourism.
It is an agent of change
A strong commitment to nature and a sense of social responsibility that includes
the sensitivity of travelers are essential elements of ecotourism.
In 2001 India had more than 2.5 million inbound visitors and 234 million
domestic tourists every year.
The travel and tourism industry accounts for nearly 6% of Indias jobs and 4.8%
of GDP, taking into account direct and indirect employment.
According to The International Ecotourism Society (TIES), ecotourism has been
growing internationally by 20-34% each year since the 1990s (Ecotourism Fact
Sheet 2006).
Ecotourism is thus seen as a vehicle for sustainable development.
INTRODUCTION
ECOTOURSM
The World Conservation Union (IUCN) and ecotourism society define ecotourism
as "responsible travel to natural areas that conserves the environment and
sustains the well-being of the local people.
"However for tourism to be called ecotourism, it should be fully compatible with
the conservation goals of the country, while at the same time pose minimum
threat to the continuation of local culture and society. Moreover, it should
contribute by means of income and education to the contribution of ecosystems
(Brown et al. 1997).
the criteria for tourism to be called ecotourism may be summarized as follows:
Minimum physical and social impacts on the visited area.
Ecological education of the tourist at the natural site
Notable economic participation by local tourists.

Nature Based
COMPONENTS
Educational
Environmental friendly

Local participation

Refers to learning about species or being informed of the features of the
environment.
Ensures that ecotourism will not degrade the environment or adversely affect
the local communityhence, affect future uses. - concept of sustainable
development
Serves two purposes: to elevate the negative pressure on the environment by
local communities, by providing them with an alternative source of income; and
to fairly distribute the revenue back to the local community.
Natural environment by focusing on biological
and physical features of the resource.
ECOTOURSM
DIFFERENCES IN TOURISM SUBCATEGORIES

Wildlife tourism

Cultural tourism

Adventure tourism



Nature based tourism


Wildlife tourism



Realm of Ecotourism with respect to other tourism categories
ECOTOURSM
EVALUATING PARAMETERS OF ECOTOURISM
A: Environmental sustainability goals of ecotourism

-promotes environmental protection (impact assessment and environmental
planning, construction methods and materials, water supply, air quality, waste
minimization, water conservation, energy minimization, minimal impact on
wildlife)
-provides environmental education
-increases public environmental consciousness
-fosters healthy attitudes and behaviors towards nature
-encourages donations to contribute to the protection of
-local natural resources air quality
ECOTOURSM
B: Socio-cultural sustainability goals of ecotourism


-Promotes local peoples active participation
-Promotes local ownership -Empowers local people
-e.g. builds up local peoples confidence/self-esteem
-Enhances local communities equilibrium
-Encourages intercultural appreciation and communication between host
communities and tourists

C: Economic sustainability goals of ecotourism

-Contributes to lasting local economic development
-Creates permanent jobs for local people
-Drives the development of other related industries
-Ungrades local infrastructure
-Profits earned retained within local communities
-Equal distribution of revenues
-Promotes consumption and production
-Finances the establishment and maintenance of protected areas
-Uses natural resources efficiently

ECOTOURSM
PRINCIPLES FOR SUSTAINABLE
ECOTOURISM

i. Using resources sustainably
ii. Reducing over-consumption
and waste
iii. Maintaining diversity
iv. Integrating tourism into
planning
v. Supporting local economies
vi. Involving local communities
vii. Consulting stakeholders and
the public
viii. Training staff
ix. Marketing tourism
responsibly
x. Undertaking research
xi. Awareness

ECOTOURSM
According to The International Ecotourism Society (TIES), ecotourism
is based on the following principles-

- minimizing impact
-building environmental and cultural awareness and respect
- providing positive experiences for both visitors and hosts
- providing direct financial benefits for conservation
- providing financial benefits and empowerment for local people
- raising sensitivity to host countries' political, environmental, and social climate
ECOTOURSM




factors must be considered in the measurement of economic costs and benefits
In term of economic costs as for instance:
The cost of energy infrastructure (existence or lack of renewable energy sources)
The cost of transport infrastructure and access lo ecotourism sites (roads and
access roads)
The cost of providing drinkable water
The cost of waste treatment (solid and sewage) in term of economic benefits
Increased income benefits for the local populations
Tax receipt benefits for the national public authorities
Royalties and access right benefits for the local public authorities.
MONITORING THE COSTS AND BENEFITS OF ECOTOURISM

MEASURING ECONOMIC COSTS AND BENEFITS OF ECOTOURISM:
ECOTOURSM
MEASURING ECOLOGICAL COSTS AND BENEFITS OF ECOTOURISM:
The instruments used to measure the ecological
costs and benefits are mainly composite indicators
to determine the pressure and intensity of use on
ecotourism sites. The WTO defines three
composite indicators particularly well adapted to
measure ecological costs and benefits:

Carrying capacity: This composite indicator
determines the maximum number of tourists that
a site can hold

Site stress: This composite indicator measures
impact levels on the site taking into account its
natural and ecological characteristics.

Attractiveness: This measures the ecological
characteristics of the site that are attractive for
ecotourism and which may change over time and
with increasing intensity of tourist visits.
ECOTOURSM
THE MEASUREMENT OF SOCIAL COSTS AND BENEFITS OF ECOTOURISM:
The following indices are used to measure this:

In terms of social cost:
Disturbance to the rate/rhythm of the local population's working lives (time
of work related to tourism compared to normal schedules of work)
Disturbance to the traditional use of space by the local population because
of the routes used by the Ecotourists
Disturbance of the local population's eating habits and everyday life as a
result of contact with tourists

In term of social benefits:
Creation of employment and new activities related to ecotourism
Improvement in comfort, living conditions and social services (electricity,
access to healthcare and education, etc.)
Measurement of the local population's degree of satisfaction through
surveys.

ECOTOURSM
the Tourism Satellite Account [TSA] model could be adapted to measure the
impact of the ecotourism on the environment and society.
The TSA implementation protect published by the WTO in 2001 states clearly that
the conceptual framework of the TSA can be widened to integrate a sectoral and
spatial focus to include environmental and social costs of tourism as well as
economic benefits. Therefore, the TSA could become the most appropriate tool to
measure the impact of tourism, in particular.

The cost of employment lost in agriculture caused by the increase in tourism
activity
The damage caused to the ecosystem
The damage to biodiversity
Goods and services which become too expensive for the local population
because of inflation as a result of demand by tourists and their suppliers
ECOTOURSM
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http://www.who.int/water_sanitation_health/publications/2012/ch12.pdf
Man and the Biosphere Programme - Wikipedia, the free encyclopedia
Biosphere reserves of India - Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Biosphere_reserves_of_India