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Evaluating the sustainability of impounded river systems and the cost-effectiveness of dam projects: An ecosystem services approach

Jean-Marie Tompkins, Edward J.S. Hearnshaw and Ross Cullen

No 100720, 2011 Conference (55th), February 8-11, 2011, Melbourne, Australia from Australian Agricultural and Resource Economics Society

Abstract: In recent times, there has been increasing demand in the Canterbury region of New Zealand for the abstraction of water from rivers. The impact of this demand has lead to unacceptable minimum river flows and has adversely affected river ecology. In an effort to resolve these issues dams have been constructed. To evaluate the impact of these dam projects on all river values, an ecosystem services approach is developed. This ecosystem services approach coupled with various evaluation methods are applied for the purposes of assessing the cost-effectiveness of the Opuha Dam and the sustainability of the Opihi river system now modified by the Opuha Dam. To evaluate the cost-effectiveness of this dam project cost utility analysis is applied through the development of an ecosystem services index (ESI). The index is constructed from the aggregation of normalized indicators that represent each ecosystem service and preferential weights of each ecosystem service. The evaluation of sustainability is considered both according to weak and strong criteria. Weak sustainability is evaluated by a non-declining ecosystem services index over time. Strong sustainability is evaluated by the thresholds or safe minimum standards where an ecosystem service, as represented by an indicator, should not pass below. Fifteen ecosystem services provided by the Opihi river were identified and data for forty-two indicators was compiled to assess the provision of these services pre- and post-dam. Fifteen regional and six local stakeholder representatives were interviewed to elicit preferential weights for each ecosystem service. Assessment of both the ESI and safe minimum standards indicates that since dam construction the river has progressed towards both weak and strong sustainability in its provision of ecosystem services. The cost-effectiveness of the dam however was poor. While further work remains to refine the approach, namely to develop more effective indicators of river ecosystem services, the work does present a novel method to evaluate the impacts of dams on river systems.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 37
Date: 2011
New Economics Papers: this item is included in nep-agr, nep-env and nep-ppm
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DOI: 10.22004/ag.econ.100720

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