Economic evaluation of structural and non-structural flood risk management measures: examples from the Mulde river

Meyer, Volker, Priest, Sally J. ORCID: https://orcid.org/0000-0003-2304-1502 and Kuhlicke, Christian (2012) Economic evaluation of structural and non-structural flood risk management measures: examples from the Mulde river. Natural Hazards, 62 (2) . pp. 301-324. ISSN 0921-030X [Article]

Abstract

The concept of flood risk management, promoted by the EU Floods Directive,tries to mitigate flood risks not only by structural, hydraulic engineering measures, but also by non-structural measures, like, e.g., land-use planning, warning and evacuation systems. However, few methods currently exist for the economic evaluation of such non-structural
measures and, hence, their comparison with structural measures. The objective of this paper is to demonstrate the potential benefits of employing a wider range of economic
appraisal methods for flood projects, in particular, it provides examples and applications of methodologies which may be employed to evaluate non-structural measures and their transaction costs. In two case studies at the Mulde River, Germany, two non-structural measures, a resettlement option and a warning system, are evaluated and compared with
structural alternatives with regard to their effectiveness, cost-effectiveness and efficiency. Furthermore, a simple approach is tested in order to show the transaction costs of these measures. Case study results show that the choice of evaluation criteria can have a major impact on the assessment results. In this regard, efficiency as an evaluation criterion can be considered as superior to cost-effectiveness and effectiveness as it is also able to consider sufficiently the impacts of non-structural measures. Furthermore, case study results indicate
that transaction costs could play an important role, especially with non-structural measures associated with land-use changes. This could explain why currently these kinds of measures are rarely selected by decision makers.

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