Full report (pdf - 1148KB) - National Audit Office

Appraisal and sustainable development 25Abatement costs: this approach aims too identify thee costs of avoidingimpacts partiallyy or completely. This might involve, for example, calculatingthe likely costs of building flood defencess and taking other appropriate actionto reduce future flooding.2.9 The Green Book provides guidance on incorporating environmental and socialimpacts, focusing particularly on preference basedd approaches. It gives anoverviewof the different methods which can be used in this area, including revealed preferencetechniques, stated preference techniques and the ‘life satisfaction approach’. 23 It alsogives guidance on valuingg time savings and healthh benefits. The Green Booksupplementary guidance on Accounting for Environmental Impacts provides aconceptual framework for identifying use and non-use value' of o a policy (Figure 9). It providesstep by step guidance on identifying impacts and how h to applyy valuation techniques toenvironmental impacts, directand indirect, to t provide thee 'total economicthe different types of environmental impact that aree part of the total economic value.Figure 9:Total economic valueSource: 'Accounting for Environmental Impacts', HM Treasury Green Book B2.10 Using these techniques to obtainvalues for non-financialnimpacts often involvesbespoke studies. Examples of such studies include the Department for Environment,Food and Rural Affairs' major UK National Ecosystem Assessment (2011)) whichaimed to monetise variouss ecosystemservices and their contribution to theUKeconomy. Earlier studies have underpinned, for example, the initial settingof the23The life satisfaction approachh uses surveys of life satisfaction to elicit values for non-market goods.