The practice of valuing the environment in cost-benefit analyses in transport and spatial projects

Abstract

Scientific debates on environmental impacts in cost-benefit analysis (CBA) focus on methodological questions. The literature, however, contains very little information on the influence of these debates on CBAs made in spatial planning practice. In this paper, this gap is filled by a qualitative analysis of 67 CBAs made in the Netherlands between 2000 and 2011. From the literature on environmental valuation, we derive criteria to evaluate the quality of CBA practice, such as completeness and the inclusion of uncertainties. The analysis shows that in many cases relevant environmental effects are omitted or not monetised. Moreover, non-monetised effects are often not included in CBA conclusions. If impacts are monetised, the methods used are frequently not very sophisticated. The consequences of assumptions are often not communicated, for example, where high discount rates make long-term effects seem unimportant. In this research we identify four main points for good practice.