ECN271 Cost Benefit Project Evaluation and Environmental Valuation

The course gives an overview of theory and methods for economic appraisal of projects, in terms of cost-benefit analysis (CBA) and theory and methods for economic valuation of environmental goods including the damage function approach, environmental and health valuation methods and benefit transfer techniques. Applications to environmental impacts from renewable and non-renewable energy investments (e.g. wind farms, hydro power plants, gas-fired power plants), noise and other impacts from transportation projects, air and water pollution policies, landscape aesthetics, biodiversity preservation, recreational fishing and hunting, marine oil spills, and health impacts from air pollution. Environmental valuation in developing countries. Laws and guidelines for CBA in Norway, EU, USA and developing countries. Welfare theoretical basis for CBA and the value judgements/assumptions made in CBA. A stepwise approach to CBA, with special emphasis on risk/uncertainty, distributional impacts, economic valuation of environmental impacts, and treatment/presentation of non-valued impacts.

Knowledge

• has advanced knowledge of the welfare theoretic basis for Cost-Benefit Analysis (CBA) and the main steps of CBA
• has in-depth knowledge of revealed and stated preference methods for valuation of environmental goods and ecosystem services
• can apply knowledge about value transfer methods for environmental goods, environmentally related illnesses, cultural heritage and other public goods

Skills:

• can analyse and critically assess results from an existing CBAs

• can use relevant valuation studies of environmental goods, public health, cultural heritage and other public goods in value transfers in a CBA

• can perform a CBA of a selected project

General competence:

• can analyse relevant public policy questions in a CBA framework

• can apply her/his knowledge and skills to use a decision support tool in practise

• can communicate results from a CBA clearly and effectively

• can co-operate and communicate effectively in a project group

• can contribute to increased attention about CBA being based on assumptions, and that the impacts on results from changing the assumptions must be evaluated in sensitivity analyses