Cost-effectiveness (CE) thresholds are being discussed more frequently and there have been many new developments in this area; however, there is a lack of understanding about what thresholds mean and ...their implications. This paper provides an overview of the CE threshold literature. First, the meaning of a CE threshold and the key assumptions involved (perfect divisibility, marginal increments in budget, etc.) are highlighted using a hypothetical example, and the use of historic/heuristic estimates of the threshold is noted along with their limitations. Recent endeavours to estimate the empirical value of the thresholds, both from the supply side and the demand side, are then presented. The impact on CE thresholds of future directions for the field, such as thresholds across sectors and the incorporation of multiple criteria beyond quality-adjusted life-years as a measure of 'value', are highlighted. Finally, a number of common issues and misconceptions associated with CE thresholds are addressed.
To mitigate serious air pollution, the State Council of China promulgated the Air Pollution Prevention and Control Action Plan in 2013. To verify the feasibility and validity of industrial ...energy-saving and emission-reduction policies in the action plan, we conducted a cost–benefit analysis of implementing these policies in 31 provinces for the period of 2013 to 2017. We also completed a scenario analysis in this study to assess the cost-effectiveness of different measures within the energy-saving and the emission-reduction policies individually. The data were derived from field surveys, statistical yearbooks, government documents, and published literatures. The results show that total cost and total benefit are 118.39 and 748.15 billion Yuan, respectively, and the estimated benefit–cost ratio is 6.32 in the S3 scenario. For all the scenarios, these policies are cost-effective and the eastern region has higher satisfactory values. Furthermore, the end-of-pipe scenario has greater emission reduction potential than energy-saving scenario. We also found that gross domestic product and population are significantly correlated with the benefit–cost ratio value through the regression analysis of selected possible influencing factors. The sensitivity analysis demonstrates that benefit–cost ratio value is more sensitive to unit emission-reduction cost, unit subsidy, growth rate of gross domestic product, and discount rate among all the parameters. Compared with other provinces, the benefit–cost ratios of Beijing and Tianjin are more sensitive to changes of unit subsidy than unit emission-reduction cost. These findings may have significant implications for improving China's air pollution prevention policy.
Display omitted
•We conduct a cost-benefit analysis of the industrial energy-saving and emission-reduction policies.•These policies are economically feasible and the estimated benefit-cost ratio is 6.32.•The emission-reduction potential of energy-saving policy is greater than that of emission-reduction policy.•There is a regional disparity of the benefit-cost ratios of implementing these policies.
The economics of wind energy Blanco, María Isabel
Renewable & sustainable energy reviews,
08/2009, Letnik:
13, Številka:
6
Journal Article
Recenzirano
This article presents the outcomes of a recent study carried out among wind energy manufacturers and developers regarding the current generation costs of wind energy projects in Europe, the factors ...that most influence them, as well as the reasons behind their recent increase and their expected future evolution. The research finds that the generation costs of an onshore wind farm are between 4.5 and 8.7
€cent/kWh; 6–11.1
€cent/kWh when located offshore, with the number of full hours and the level of capital cost being the most influencing elements. Generation costs have increased by more than 20% over the last 3 years mainly due to a rise of the price of certain strategic raw materials at a time when the global demand has boomed. However, the competitive position of wind energy investments vis-à-vis other technologies has not been altered. In the long-term, one would expect production costs go down; whether this will be enough to offset the higher price of inputs will largely depend on the application of correct policies, like R&D in new materials, O&M with remote-control devices, offshore wind turbines and substructures; introduction of advanced siting and forecasting techniques; access to adequate funding; and long-term legal stability.
Smart energy and electricity networks are a crucial component in building smart city architectures; their consistent and harmonized inclusion in the smart city design should be carefully considered ...through a detailed analysis of the impacts (environmental, energy, economic, societal) and the implementation of cost benefit analysis (CBA), not only in terms of managing the grid itself but also in a wider perspective that includes environmental, security, and social aspects. This paper first discusses the main impact that smart grid deployment has, in different respects, in smart cities and then presents a methodology for an extended CBA, able to go beyond the strictly financial aspects. It is based on previous developments at the European level. The methodology conceptually illustrated can naturally be extended to the assessment of proposals for the development of smart cities.
Environmental and social disclosures entail costs, yet increasingly, large listed firms are making higher and better quality disclosures. In this paper we examine the link between a firm's ...environmental and social disclosures and its profitability and market value. We find that past profitability drives current social disclosures. However, consistent with the existing evidence, we do not find any relation between environmental disclosures and profitability. Further, while prior literature has largely focussed on environmental disclosure, we find that it is the social disclosures that matter to investors. We find that firms that make higher social disclosures have higher market values. Further analysis reveals that this link is driven by higher expected growth rates in the cash flows of such companies. Overall our findings are consistent with the resource based view of the firm and the voluntary disclosure theory, suggesting that firms with greater economic resources make more extensive disclosures which yield net positive economic benefits.
Implementation of food taxes or subsidies may promote healthier and a more sustainable diet in a society. This study estimates the effects of a tax (15% or 30%) on meat and a subsidy (10%) on fruit ...and vegetables (F&V) consumption in the Netherlands using a social cost-benefit analysis with a 30-year time horizon.
Calculations with the representative Dutch National Food Consumption Survey (2012-2014) served as the reference. Price elasticities were applied to calculate changes in consumption and consumer surplus. Future food consumption and health effects were estimated using the DYNAMO-HIA model and environmental impacts were estimated using Life Cycle Analysis. The time horizon of all calculations is 30 year. All effects were monetarized and discounted to 2018 euros.
Over 30-years, a 15% or 30% meat tax or 10% F&V subsidy could result in reduced healthcare costs, increased quality of life, and higher productivity levels. Benefits to the environment of a meat tax are an estimated €3400 million or €6300 million in the 15% or 30% scenario respectively, whereas the increased F&V consumption could result in €100 million costs for the environment. While consumers benefit from a subsidy, a consumer surplus of €10,000 million, the tax scenarios demonstrate large experienced costs of respectively €21,000 and €41,000 million. Overall, a 15% or 30% price increase in meat could lead to a net benefit for society between €3100-7400 million or €4100-12,300 million over 30 years respectively. A 10% F&V subsidy could lead to a net benefit to society of €1800-3300 million. Sensitivity analyses did not change the main findings.
The studied meat taxes and F&V subsidy showed net total welfare benefits for the Dutch society over a 30-year time horizon.
This paper estimates the rate of return to the HighScope Perry Preschool Program, an early intervention program targeted toward disadvantaged African-American youth. Estimates of the rate of return ...to the Perry program are widely cited to support the claim of substantial economic benefits from preschool education programs. Previous studies of the rate of return to this program ignore the compromises that occurred in the randomization protocol. They do not report standard errors. The rates of return estimated in this paper account for these factors. We conduct an extensive analysis of sensitivity to alternative plausible assumptions. Estimated annual social rates of return generally fall between 7 and 10%, with most estimates substantially lower than those previously reported in the literature. However, returns are generally statistically significantly different from zero for both males and females and are above the historical return on equity. Estimated benefit-to-cost ratios support this conclusion.
Measures aimed at conservation or restoration of ecosystems are often seen as net‐cost projects by governments and businesses because they are based on incomplete and often faulty cost‐benefit ...analyses. After screening over 200 studies, we examined the costs (94 studies) and benefits (225 studies) of ecosystem restoration projects that had sufficient reliable data in 9 different biomes ranging from coral reefs to tropical forests. Costs included capital investment and maintenance of the restoration project, and benefits were based on the monetary value of the total bundle of ecosystem services provided by the restored ecosystem. Assuming restoration is always imperfect and benefits attain only 75% of the maximum value of the reference systems over 20 years, we calculated the net present value at the social discount rates of 2% and 8%. We also conducted 2 threshold cum sensitivity analyses. Benefit‐cost ratios ranged from about 0.05:1 (coral reefs and coastal systems, worst‐case scenario) to as much as 35:1 (grasslands, best‐case scenario). Our results provide only partial estimates of benefits at one point in time and reflect the lower limit of the welfare benefits of ecosystem restoration because both scarcity of and demand for ecosystem services is increasing and new benefits of natural ecosystems and biological diversity are being discovered. Nonetheless, when accounting for even the incomplete range of known benefits through the use of static estimates that fail to capture rising values, the majority of the restoration projects we analyzed provided net benefits and should be considered not only as profitable but also as high‐yielding investments. Beneficios de Invertir en la Restauración de Ecosistemas
To improve the air quality in winter, clean heating policy was implemented in “2 + 26” cities of China in 2016, which mainly included replacing coal with gas or electricity. Tremendous financial ...subsidies have been provided by city and central governments. This new heating mode changed the heating fee-cost to residents. This paper estimates the economic costs to both governments and residents, and evaluates the environmental and public health benefits by combining a difference-in-differences model with an exposure-response function. Results show that the total costs of clean heating were up to 43.1 billion yuan. Governments and residents account for 44% and 56% of the total costs, respectively. In terms of benefits, the clean heating project is effective for air pollution control and brings health economic benefits of about 109.85 billion yuan (95% CI: 22.40–159.83). The clean heating policy was identified as a net-positive benefit program with environmental and public health improvements. However, the inequality in subsidies from different cities governments increases the heating burden on low-income households and leads to heating poverty for households in the less developed regions. We provide suggestions for implementation in future clean heating campaigns and in subsidy mechanism design in China and for other developing countries.
•Existing situation and problems of clean heating and its subsidy in China.•Economic costs of clean heating were up to 43.1 billion yuan.•Governments and residents account for 44% and 56% of the total costs.•Clean heating program brings health economic co-benefits of about 109.85 billion yuan.•Clean heating was a net positive benefit program.
PDF
