Costs and environmental benefits of watershed conservation and restoration in Taiwan

Abstract

This top-down study aimed to evaluate the environmental benefits derived from a US$93.3 million investment in watershed improvement, financed by the Taiwanese government at the first stage (2017–2018). The 95 watersheds feeding local reservoirs are facing challenges from a changing environment and population growth. The investment funding was mainly used for sediment reduction, forest restoration, and stream conservation. The results showed that the greatest environmental benefits resulted from water quality improvement (49%), followed by ensuring a steady water supply (20%), and hydropower supply (16%). Environmental benefits from water quantity improvement (8%), forest restoration (5%), and carbon reduction (2%) totaled US$2 million in 2018. The calculation of costs and environmental benefits from 2018 to 2047 using a social rate of discount of 1.156% revealed that the environmental benefits that minimized the effects of natural disasters were the most expensive (US$115.6 million), followed by those that achieved sediment reduction over 10 y (US$6.9 million). It was calculated that by 2046 (29th y after investment), regardless of the investment cost, the total value of environmental benefits would exceed the operation and maintenance costs. The overall cost-benefit analysis revealed a value of 1.055, which compares favorably with the values for other infrastructure projects in Taiwan. According to the results of the sensitivity analysis, environmental benefits derived primarily from sediment reduction, with reductions in electricity usage, forest restoration, and carbon price being secondary factors.