Cost benefit analysis of peri-urban land use policy - Plurel

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Cost-benefit analysis has been around for several decades as a tool to assist planners and policy makers in making decisions. It has been applied in particular for transport policy and, in recent years, for assessing the sustainability of environmental policy – e.g. in the assessment of the Clean Air for Europe programme (ref). We apply the method to assess the viability of a scheme to develop a golf course in the fringe of a town in Slovenia – Koper – on a site that currently is dominated by a vineyard and some housing. The structure of the paper is as follows. First, we establish the case study in Koper. Then we identify potential costs and benefits of policy measures, and potential techniques to quantify these in monetary terms. We then present background data, which feeds the results of a costbenefit analysis. Finally, policy conclusions are drawn and areas for further research are identified. Case study of Koper This case looks at one potential measure to convert part of the existing vineyards on the peninsula of Debeli rtič to an 18-hole golf course in Koper. That would change part of the existing land from agricultural use to a green space. The size of the total area to be converted accounts for 236 hectares, and this includes 150 hectares of current vineyard, 66 hectares of forestry and 20 hectares of private settlement. Figure 1: Location of proposed development Source: Googlemap Page 10 • PLUREL report No 4.4.3 • December 2010
Costs and benefits A scoping of potential costs and benefits of the proposed development is given in Table 1. Some impacts can be valued using market-based methods. For example, the lost grape production can be valued using the market price of grapes (assuming that the impact on yield in the region is marginal – otherwise some adjustment would be needed). For climate regulation, the social cost of carbon can be used (e.g. ref). For recreational values, contingent valuation could be used. For amenity, hedonic pricing methods allow for the estimation of the benefits of living nearer to golf courses – and later we apply benefit transfer to attempt to isolate these values. In what follows, we assume that the golf course management will be to the best environmental standards 1 .. Costs Physical land cost The land price for agricultural land ranges at 10-15 €/m 2 in the selected area, according to the information provided by the stakeholder. Hence the total land cost of claiming the vineyard is estimated at between 15,000,000 and 22,500,000 €. Considering forest land as a type of agricultural land, we estimate the cost of claiming 66 hectares of forest at between 6,600,000 and 9,900,000 €. The cost of claiming private settlement will be discussed later in the section of compensation costs as a result of converting private settlement. 1 In what follows we have ignored impacts of fertilisers and pesticides. This may be added in a later version. Water use of golf courses can also be significant and we will further examine this. Page 11 • PLUREL report No 4.4.3 • December 2010
Page 1 and 2: Sustainability Impact Assessment Mo
Page 3 and 4: Cost benefit analysis of transport
Page 5 and 6: Classification of results/outputs:
Page 7 and 8: Introduction The valuation of the p
Page 9: Golf Course Development in the Peri
Page 13 and 14: Compensation costs to the conversio
Page 15 and 16: We applied the marginal value estim
Page 17 and 18: Table 5: Development costs of golf
Page 19 and 20: The average house price in the poli
Page 21 and 22: Tourism Koper is located in the reg
Page 23 and 24: Results Taking the figures for the
Page 25 and 26: Navrud, S. and R. Ready(2002) Valui
Page 27 and 28: The Mosslands visioning project The
Page 29 and 30: Figure 2: Land Use Plan with Maximu
Page 31 and 32: Table 8: Specifications of each zon
Page 33 and 34: ⎛ Pop ⎞ ⎛ ⎞ T1 GDPT 1 V =
Page 35 and 36: Table 10: Valuation data for wetlan
Page 37 and 38: Table 11:Values for Hydrological Zo
Page 39 and 40: Agricultural zone Land use within t
Page 41 and 42: Table 12: Current Data on Agricultu
Page 43 and 44: Table 14: Gross margin (in 2008£)
Page 45 and 46: details are exhibited in Page 45
Page 47 and 48: Table 16: Profitability of horticul
Page 49 and 50: Public enjoyment and access zone Th
Page 51 and 52: Results and discussion Table 19 exh
Page 53 and 54: Figure 3:Net Benefits of Maximum We
Page 55 and 56: The use of the combining of socioec
Page 57 and 58: Economics for the Environment Consu
Page 59 and 60: Cost Benefit Analysis of Transport
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In relation with differing sustaina
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The MOLAND Model The MOLAND Model i
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Figure 1. Growth Paths and Spatial
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Scenarios for the GDA Within the fr
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Figure 3. Transport 21 Network Used
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towns (see Figure 6). In other word
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operation costs, travel time, accid
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Capital Cost Estimation of Rapid Ra
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Valuation of Traffic Safety It can
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Railway costs can be analysed as fi
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Table 6. Average Earnings-Wage, Sal
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value and discounted at a standard
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Table 9. Summary of Sensitivity Tes
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Source: Lavalle et.al. (2009) The c
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DKM Ltd. Economic Consultants. (199
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Orsini, F. and Williams, B. (2009)
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Applying Economic Valuation to Peri
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Table 1: Marginal damage costs of C
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Results GDP For the Leipzig-Halle c
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Open space Open space in Leipzig wa
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Discussion In this report, we have
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Annex 1: Calculation of Amenity Los
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