International Center For Adaptation Planning and Design

A spatial temporal econometric model to estimate costs and benefits of sea level rise adaptation strategies

Project title: A spatial temporal econometric model to estimate costs and benefits of sea level rise adaptation strategies

The rise of sea level, as one of the most obvious and direct impacts of climate change in coastal areas, has become an important and urgent problem. A large amount of efforts have been devoted to sea level rise impact analysis and adaptation planning. However, despite these research efforts and various existing sea level rise adaptive planning tools, decision makers and residents at the coastal area is not making significant progress to prepare for future sea level rise. One of the major reasons for this slow reaction is that people are unaware of the costs of doing nothing or postponed actions, and the benefits of taking adaptation actions. Cost-benefit analysis is a promising tool to address this issue. However, existing literatures applying cost-benefit measure to analyze sea level rise or its adaptation strategies do not take full consideration of indirect economic impacts of various adaptation strategies. Furthermore, existing studies do not evaluate the action time point to implement these strategies.

This dissertation research aims to bridge these gaps by integrating both direct and indirect economic impacts of sea level rise into a cost-benefit analysis framework, which is applied to evaluate most commonly adopted adaptation strategies. This study selects six commonly discussed and adopted sea level rise adaptation strategies for analysis. It then estimates the economic loss on land value, business revenue, coastal wetland ecosystem services, building damages and value of travel time delay at different time points. These economic losses are considered as benefits of adaptation strategies. Next, the cost of adopting these strategies are quantified at different time points which are consistent with benefit analysis. Finally, all the benefits and costs are put together to analyse the cost efficiency and best time to take actions. It also proposes an adaptation plan that assigns each strategy to its appropriate locations as a guide for local communities. An uncertainty analysis is also conducted to evaluate the cost efficiency of adaptation strategies as well as the proposed adaptation plan under different uncertainty levels.

The analysis results show that different strategies have very different cost efficiency. Generally speaking, the strategies that target to protect built environment have higher cost efficiency than the ones that focus more on preserving ecosystems. Furthermore, cost benefit analysis at different action time points help to decide the best action time for each strategy as well as the adaptation plan. Although current sea level rise projection is associated with high uncertainty, the uncertainty analysis shows that even under the highest uncertainty level, most adaptation strategies and the adaptation plans are more cost efficient than do nothing.

Sea level rise adaptation strategies

LISA significance map for average land value

Adaptation plan