Estimating coastal asset values using multi-criteria and ... · PDF fileEstimating coastal...

Estimatingcoastalassetvaluesusingmulti-criteriaandvaluationmethods

CSIROOCEANSANDATMOSPHERE

SeanPascoe,AmarDoshi,MladenKovacandAngelicaAustinAustralianCoastalCouncilsConference,Brisbane,May2017

Outline

• Roleofeconomicvaluesincoastalplanning• Manyvalues!• Combiningtechniquestoestimatecoastalvalues• Multi-criteria approaches (AHP)• Choiceexperiment• Somekeyresults

Estimatingcoastalassetvaluesusingmulti-criteriaandvaluationmethods2 |

Acknowledgement:Thestudywassupported bytheNSWEnvironmentTrustEnvironmentalResearchProgram,Project2014/RD/0017,andCSIROOceansandAtmosphere

• Coastalassetshavevaluesthatarenotaccountedforinthemarketplace• Can’tbuyorsellahectareofbeach• Coastaldevelopmentincreasinglyimpingingonthecoastalenvironment• Benefit costanalysisrecommended inNSWtoinformcoastalmanagementoptionsbeingconsidered bycouncils

• Climatechangeadaptationworkstoprotectcoastalresourcesexpensive• Howdowejustifyorprioritise thiswhenbudgetsarelimitedandothercompetinguses forthefunds?

• Marinereserveplanningalsorequireestimatesofnaturalcapitalvalues• Onlyfew(andlimited)studiesoncoastalvaluesinAustralia


Roleofeconomicvaluesincoastalplanningandmanagement

3 |

• Coastalenvironmentshavemanycomponentswithdifferentvalues• “traditional”non-market valuetechniques are– inpractice– limitedtodealingwithonlyafewcomponentsatatime

• Thebasicpremiseofthisstudy…• Relativewillingness topayreflect relativepreferences– Preference elicitationtechniques shouldbeabletoapproximaterelativeWTP

– Multicriteriapreference elicitationtechniques canaccommodatealargernumberofalternatives thanmostnon-market valuationtechniques

• Non-marketvaluation techniquescanbeapplied toderivevalues forkeyassets– Thesecanbescaled forotherassetsbasedontherelativepreferences


Aimandchallengeofthisstudy

4 |

• Onlinesurveyof1400NSWcoastalresidents

• Multicriteriaanalysisapproach (AnalyticHierarchyProcess (AHP))used toderive relative importanceofallassets

• Choiceexperiment used toestimateWTPfortheshorebasedassetsonly


Sowhatwedid…

5 |

Keynaturalcapitalassetstobeexaminedinthisstudy

Location KeyAssetShoreline Beaches

RockyshoreHeadlands

Backshore SanddunesAdjacentscrublandFreshwaterLakes/Rivers

Intertidal EstuariesMangrovesSaltmarsh

Aquatic SeagrassReefsSandyseabed


Somesampledetails

6 |


Beachvisitation

7 |

• Geometricmeanmethod• Lessinfluenced by“extreme” preferences


AHPapproach

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1/

,1

1/

,1

nn

i kk

ni n

i kk k

a

aω =

=

⎛ ⎞⎜ ⎟⎝ ⎠=⎛ ⎞⎜ ⎟⎝ ⎠

∏

∑ ∏

12. A=Shoreline(Beach,headland,rockyshore); B=Backshore(dunes,scrubland,lakes/rivers)

AllA(noB)

MostlyA

MuchmoreA

MoreA

equalimportance

A=B

MoreB

MuchmoreB

MostlyB

AllB(noA)

(codefrom1to17lefttoright)

IncreasingimportanceofA IncreasingimportanceofB

, 9i ka =, 1i ka =

, 1 / 9i ka =


Hierarchy

9 |

Coastalassets

Shoreline

Sandybeach

Rockyshore

Headland

Backshore

Sanddune

Adjacentscrubland

Freshwaterlakes/rivers

Intertidal

Estuaries

Mangroves

Saltmarsh

Aquatic

Seagrass

Reefs

Sandyseabed

• D-efficientdesigndevelopedusingNGENE• Fourblocksof6choicesets(total100ha– justtradingoffassets)• Twoblocksof6choicesets (varyingsize– sizeandassets)• Scenario:CoastalareastobeprotectedthroughRegionalConservationPlans• Paymentmechanism:Environmentallevyincludedinquarterlyrates(indefinitelevy).


Choicemodel

10 |


AHPResults

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• Widerangeofpreferencesforbeachgoers• Non-beachgoerswerelargelyindifferent


Relativetosandybeach

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Medianrelativevalues

• Medianrelativevalues– relativetosandybeach• Usingalldata• Usingdataonlyforthosethatvisitedthebeachinthelast12months• Removingthosethatwere“indifferent”betweenthedifferentassets

Estimatingcoastalassetvaluesusingmulti-criteriaandvaluationmethods13 |

Coefficient StandardError z sig

Randomparametersinutilityfunctions

Sandybeach(ha) 0.056 0.002 36.170 ***Dunesandscrubland(ha) 0.047 0.002 28.790 ***Headlandandrockyshore(ha) 0.037 0.002 21.720 ***Cost($/household/quarter) -0.062 0.002 -30.050 ***Non-randomparametersinutilityfunctions ASC 1.517 0.222 6.820 ***Male -0.226 0.099 -2.280 **Age 0.011 0.003 3.470 ***Sydney -0.148 0.105 -1.400 Income -0.002 0.001 -2.520 **NSWNationalParkannualpass -0.509 0.174 -2.930 ***Environmentalgroupmember -0.662 0.234 -2.840 ***Distancefrombeach -0.002 0.001 -2.320 **Distributionofrandomparameters(standarddeviations) Sandybeach 0.056 0.002 36.170 ***Dunesandscrubland 0.047 0.002 28.790 ***Headlandandrockyshore 0.037 0.002 21.720 ***Cost 0.062 0.002 30.050 ***

• RandomparametersmodelestimatedinNLOGIT


Choiceexperimentpreliminaryresults

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Non-randomparameters indicate likelihood thattherespondentwouldchoose“none”• Nosignificant differencebetweenSydney/non-Sydney• Likelihood increaseswithage• Likelihood decreaseswithothervariables

Indicatesthatthevariableis

highlystatisticallysignificant

Notstatistically significant

• Assetvaluesscaleduptoannualfigure,discountedindefinitelyassuming4%discountrate(lowerboundsuggestedbyTreasury)• RelativevaluesforotherassetsreasonablysimilartothosederivedfromAHP(directcomparisondifficultascombinedinthechoiceexperiment)


Derivedeconomicvalues

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CoastalAsset WillingnesstoPay Relativetobeach

$/ha/quarter NPV$/ha/household

Fromchoicemodel

FromAHP

Beach $0.90 $89.82

Dunesandscrubland

$0.76 $75.70 0.843 0.630

Headlandsandrockyshores

$0.60 $59.69 0.665 0.630

• Mixedlogitmodelrecognisesthatthereisvariabilityinvaluesofindividuals


Variabilityinvalues

16 |


Expandingthevalues….

17 |

Asset AHP MLM($/ha/household)

SandyBeach 1.000 $89.82

Headland 0.794 $71.29

Rockyshoreline 0.474 $42.60

Dunes 0.699 $62.82

AdjacentScrubland 0.568 $51.04

FreshwaterLakes 0.777 $69.80

Estuary 0.467 $41.92

Saltmarsh 0.358 $32.19

Mangroves 0.529 $47.49

Seagrass 0.751 $67.44

Reefs 0.556 $49.90

SandySeabed 0.801 $71.93


Anexampleofwhatthismaymean

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• ManlyBeach(ManlyShirepopulation)

• Forcomparison…• VacantlotnearManlyBeach– Askingprice$4-4.4m– Landsize690m2

– Valueperha=$57,971,014• Sobeachesarestillrelativelycheaprealestate!

Sandybeach Adjacentpark

Households 18,050

Value/ha $1,621,251 $575,434

Area (ha) 10.35 2.8

Totalvalue $16,779,948 $1,611,215


Furtherafield…Estimatedvalue$m/ha

19 |

Manly Warringah Byron Coffs

Households 18,050 58,300 11,197 27,614

SandyBeach $1.62 $5.24 $1.01 $2.48

Headland $1.29 $4.16 $0.80 $1.97

Rockyshoreline $0.77 $2.48 $0.48 $1.18

Dunes $1.13 $3.66 $0.70 $1.73

AdjacentScrubland $0.92 $2.98 $0.57 $1.41

FreshwaterLakes $1.26 $4.07 $0.78 $1.93

Estuary $0.76 $2.44 $0.47 $1.16

Saltmarsh $0.58 $1.88 $0.36 $0.89

Mangroves $0.86 $2.77 $0.53 $1.31

Seagrass $1.22 $3.93 $0.76 $1.86

Reefs $0.90 $2.91 $0.56 $1.38

SandySeabed $1.30 $4.19 $0.81 $1.99

• Projectisstillgoingforacoupleofmonths• Potentialchangesinsomeofthesevalues

• Keyquestion• Howfaroutdowegointermsofhouseholds?

• Thesecaptureassetvalues• Recreational usevaluesarelikelytobesubstantiallyhigher (asiscontributiontolocaleconomies)


Somecaveatsandhealthwarnings

20 |

[email protected]

CSIROOCEANSANDATMOSPHERE

ThankyouThanksalsotoSydneyCoastalCouncilGroup

andEurobodallaShireCouncilAcknowledgement:Thestudywassupported bytheNSWEnvironmentTrustEnvironmentalResearchProgram,Project2014/RD/0017,andCSIROOceansandAtmosphere

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