The Multiple Benefits of the Hondsbossche and Pettemer sea dunes, valued by IISD through the SAVi methodology
An assessment with the Sustainable Asset Valuation (SAVi) methodology by the International Institute for Sustainable Development (IISD) – the leading organisation behind the NBI Global Resource Centre – shows that the Hondsbossche and Pettemer (H&P) sea dunes outperform conventional flood protection infrastructure. In comparison to a grey infrastructure alternative of raising the sea dike, the nature-based infrastructure (NBI) was cheaper to build and brings greater benefits for tourism. Based on IISD’s modelling, the sand dunes increase tourism revenue by almost EUR 203 million over 50 years, while the grey alternative would have increased it by only EUR 103 million.
In 2004, the Directorate-General of Public Works and Water Management in the Netherlands (Rijkswaterstaat) declared that the dunes and sea dykes of H&P are not in line with the flood protection standards of the Netherlands. Therefore, a EUR 250 million project was undertaken to improve flood safety and spatial quality. This project followed the Building with Nature (BwN) design to comply with the sustainability aspects. The specifics of the design allow for a seabed erosion-free solution that also provides a shallow foreshore for leisure and an artificial dune landscape that can develop into a natural habitat (EcoShape, 2018).
“Constructing new marine infrastructure or maintaining ports and waterways has both a positive and sometime a negative effect on the environment. That’s why sustainability throughout the dredging industry is key. And finding nature-based solutions is crucial”, says Rene Kolman, Secretary General of IADC. “To become truly sustainable all impacts should be considered in project evaluations. The influence on biodiversity or recreation opportunities, for instance, are hardly taken into account in project evaluations. IADC believes in promoting inclusion of all externalities. The result of the SAVi assessment of the Hondsbossche and Pettemer sea dunes has allowed IADC to showcase the benefits of nature-based solutions and the additional value that can be created.”
“The Hondsbossche and Pettemer sea dyke and sand dunes project is a perfect fit for the assessment study since Building with Nature projects tend to contain more objectives than traditional projects. For example, traditionally, it is common to focus on flood protection and cost efficiency only, while the H&P sea dyke focuses on flood protection, nature development and improvement of spatial quality. Therefore, the project involved longer temporal and larger spatial scales than those of traditional maritime infrastructure projects. To evaluate the created value through all three objectives, a holistic methodology like SAVi is essential”, says Matthew Gouett, Sustainable Finance Analyst at IISD.
About the SAVi methodology
Sustainable Asset Valuation (SAVi) is a project assessment methodology that combines system dynamics and project finance modelling. It is owned by The International Institute for Sustainable Development, which is a non-profit organisation that acts as an independent think tank that focuses on the creation of solutions to enhance stable climate, sustainable resources and fair economies. The impacts included in the SAVi database are environmental, social, economic consequences and direct costs, and climate risks. The three main features of the SAVi methodology are valuation, simulation and customisation. During the valuation process, all externalities and risks are converted into monetary terms.
Once that is achieved, the SAVi incorporates system dynamics and project finance modelling. It receives the data about previously mentioned impact estimates from peer-reviewed literature, case studies, international databases and project-specific values that may be available from social and environmental impact assessments. The methods used to obtain impact estimates when data is not available are contingent valuation and replacement cost. Additionally, IISD has cooperated with Copernicus Climate Change Service (C3S) to acquire additional data currently implemented in the SAVi valuation methodology. C3S provides a database that focuses on climate and climate change impact. Currently, the database that is implemented in SAVi methodology consists of 1,354 externality valuations, 196 valuations of direct costs and 511 measures of climate risk.
About the NBI Global Resource Centre
Last year, the NBI Global Resource Centre was launched and aims to bring together key partners to establish a business case for Nature-Based Infrastructure (NBI). We provide data, training, and sector-specific valuations based on the latest innovations in systems thinking and financial modelling. The NBI Global Resource Centre is funded by the Special Climate Change Fund (SCCF) which is managed by the Global Environment Facility (GEF) and the MAVA Foundation and led by the International Institute for Sustainable Development (IISD), in partnership with the United Nations Industrial Development Organization (UNIDO).
More to read:
IISD wrote a story of the assessment, which can be read here: https://nbi.iisd.org/hondsbossche-dunes/
The IISD report with the results of the SAVi assessment of the Hondsbossche Dunes project can be downloaded here: https://nbi.iisd.org/report/savi-nature-based-coastal-protection-netherlands/
Study: Valuation of Externalities
Recently, the results of a study by Viktorija Karaliūtė are published in IADC’s journal Terra et Aqua about the valuation of externalities in maritime infrastructure projects. This study investigates the available sustainable asset valuation methods that can include the externalities materialised in maritime infrastructure projects and compares them based on economic, social and environmental criteria. Read more here: https://www.iadc-dredging.com/article/valuation-externalities-maritime-infrastructure/
IISD and IADC are preparing a webinar about the SAVi assessment of the Hondsbossche Dunes project, with speakers of IISD, EcoShape and the Dutch Water Board (Hoogheemraadschap Hollands Noorderkwartier) and moderated by IADC. Stay tuned for more information.