Aqueduct Floods: Cost Benefit Analyzer Tool

The Aqueduct Floods Cost-Benefit Analyzer allows you to assess the potential costs and benefits of investing in flood protection infrastructure. This tool helps you make informed decisions about where and how much to invest in flood mitigation. 

Video tutorial

If you prefer videos, here’s the step-by-step playlist on our YouTube channel.

Understanding the Calculations Behind the Aqueduct Floods Cost-Benefit Analyzer

The Aqueduct Floods Cost-Benefit Analyzer (CBA) assesses the economic feasibility of investing in flood protection infrastructure. It calculates both the costs and benefits of building and maintaining dikes and levees to protect urban areas from riverine floods. 
 

Calculating Costs

The CBA includes two primary cost components:

• Construction Costs:
  • Determined by a country-specific construction cost factor, representing the cost per unit of infrastructure (e.g., $7 million per meter depth per kilometer length in the United States).
  • Calculated by multiplying the construction cost factor by the dimensions of the proposed infrastructure.
  • Larger and stronger infrastructure results in higher construction costs.
• Operation and Maintenance (O&M) Costs:
  • Represents the ongoing expenses of operating and maintaining the infrastructure.
  • Calculated as a percentage of the total construction cost.
  • Included throughout the infrastructure's lifespan.

Calculating Benefits

The CBA focuses on the benefits of avoided damage to urban assets:

• Expected Annual Damage Without Adaptation:
  • Estimates potential flood damage to urban areas without any additional flood protection measures.
• Expected Annual Damage With Adaptation:
  • Estimates potential flood damage after implementing the proposed flood protection infrastructure.
• Avoided Damage:
  • Calculated as the difference between the expected annual damage without and with adaptation.
  • Represents the economic benefits of the flood protection infrastructure.

By comparing the total costs to the total benefits, the CBA provides a cost-benefit ratio that helps assess the economic feasibility of the investment.

Note: The CBA focuses on direct economic costs and benefits and does not include indirect impacts such as human health, environmental damage, or social disruption caused by floods. 
 

Aqueduct Floods: Using the Cost-Benefit Analyzer for Flood Protection

Step 1: Select Your Location

• Choose a location: Begin by selecting the geographic area you want to analyze. You can input a major river basin, country, or state name.
• Select a future scenario: Choose from three available future scenarios representing different combinations of carbon emissions and socioeconomic development pathways. For more details on each scenario, click the "info" button.

Step 2: Design Your Flood Protection Infrastructure

• Assign existing protection: Determine the current level of flood protection for the selected location. This is measured by the return period (or recurrence interval), which indicates the probability of a flood occurring in a given year. You can use the default value or input a custom value based on your knowledge of the area.
• Define future protection: Specify the desired level of flood protection you want to protect against, defined as the return period (e.g. 100-year flood) for a future year (e.g., 2050).
• Set implementation details:
  • Implementation range: Define the timeframe for constructing the flood protection infrastructure.
  • Infrastructure lifespan: Specify the expected lifespan of the infrastructure.
  • Benefits start year: Indicate when you expect to start seeing the benefits of the infrastructure.

Step 3: Estimate Costs

• Construction cost: Adjust the default construction cost per meter depth per kilometer length based on your knowledge of local conditions.
• Discount rate: This represents the rate at which future values are discounted to present value. Use the default value unless you have specific requirements.
• Operation and maintenance (O&M) costs: Estimate the annual cost of operating and maintaining the infrastructure as a percentage of the construction cost.

Step 4: Run a Comparative Analysis (Optional)

• Compare scenarios: Create multiple analyses by adjusting the level of flood protection or other parameters.
• Evaluate trade-offs: Compare the cost-benefit results of different scenarios to identify the most effective investment strategies.

Step 5: Interpret Results

• Analyze cost-benefit graphs: Review the generated graphs to understand the relationship between investment costs and flood damage reduction.
• Consider additional factors: Remember that the cost-benefit analysis is based on estimates and assumptions. Consider other factors, such as social and environmental impacts, when making decisions.

Additional Tips

• Use the "info" button throughout the process to learn more about specific terms and calculations.
• Experiment with different parameter values to explore various scenarios and their potential outcomes.
• Consider consulting with experts in hydrology, economics, and engineering for additional insights.

By following these steps and carefully interpreting the results, you can effectively use the Aqueduct Floods Cost-Benefit Analyzer to support informed decision-making on flood risk management.

Note: The tool provides estimates and should be used as a starting point for further analysis and consideration of local factors. 

Understanding the Cost-Benefit Analysis Results

The Cost-Benefit Analyzer provides several graphs and metrics to help you interpret the potential impacts of your flood protection investment.

Cumulative Net Benefits Graph

• This graph shows the total benefits minus the total costs over time.
• A positive value indicates that the benefits outweigh the costs.
• The point where the line crosses the x-axis represents the time when benefits start to exceed costs.

Benefits and Costs Graph

• This graph separates the benefits and costs into individual lines for a clearer view.
• It highlights the timing of construction costs and the ongoing nature of operation and maintenance costs.

Implementation Costs Graph

• This graph focuses solely on the costs incurred during the construction phase.
• Compare the costs of different infrastructure options.

Operation and Maintenance (O&M) Costs Graph

• This graph illustrates the annual O&M costs throughout the infrastructure's lifespan.
• Understand the ongoing financial commitment required for maintaining the infrastructure.

Protection Level Graph

• This graph visualizes the level of flood protection over time.
• Track the progress of building the infrastructure to reach the desired protection level.

Cost-Benefit Ratio

• This metric compares the total costs to the total benefits.
• A ratio less than one indicates that benefits outweigh costs.
• A higher ratio (closer to one) suggests a less favorable cost-benefit relationship.
• For easier interpretation, you can invert the ratio to see the return on investment (e.g., a ratio of 1.36 means you get $1.37 in benefits for every $1 spent).

Additional Considerations

• The analysis focuses on urban assets and avoided damages, excluding indirect costs like human health impacts or economic disruptions.
• The cost-benefit ratio is just one metric. Consider other factors like population protection and environmental impacts.
• Explore alternative flood management strategies beyond dikes and levees to address flood risk comprehensively.

By carefully analyzing these graphs and metrics, you can make informed decisions about the potential effectiveness and financial viability of your flood protection investment.

Remember: This tool provides valuable insights but should be used in conjunction with other factors and expert knowledge for a comprehensive assessment.