EVALUATION

AN INDEPENDENT EVALUATION OF THE LCNF
Figure 23 – Estimated scaled benefits
12,000
10,000
Potential range of the estimated
scaled benefits
8,000
Range of Estimated Future Benefits
£ million
6,000
4,000
2,000
0
Source: GB DNOs and Pöyry / Ricardo analysis
Benefits
5.3.4 Net benefit
Figure 24 presents an assessment of the estimated net benefit from the LCNF. The net
benefit takes account of the costs highlighted in Section 5.3.1 together with our estimate
of the counterfactual position – where net benefit is equal to the gross estimate of the
value of the benefits minus the cost and adjusted for our assessment of the counterfactual
position.
As we set out in Section 2.5.4 we have sought to identify an appropriate counterfactual
through a qualitative process, supported by an assessment of the benefits identified by
the DNOs in their responses to our questionnaire. Based on this assessment we have
estimated the counterfactual to be around 20% of the total (gross) benefit.
We estimate that the net benefit, taking account of the project costs and the
counterfactual position (20%), is in the order of £1.1bn to £1.7bn.
PÖYRY MANAGEMENT CONSULTING
October 2016
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