The use of equivalent annual cost for cost benefit analyses in flood risk reduction strategies

The use of equivalent annual cost for cost benefit analyses in flood risk reduction strategies

Schoemaker, M.A.
Verlaan, J.G. (TU Delft Integral Design & Management)
Vos, R (Ministry of Infrastructure and the Environment)
Kok, M. (TU Delft Hydraulic Structures and Flood Risk)

Lang, M. (editor)
Klijn, F. (editor)
Samuels, P. (editor)

2016

In many parts of the world, flooding is a big risk. There are numerous strategies to reduce flood risk. The amount of flood risk reduction strategies grows exponentially with the amount of possible measures that can be implemented and possible timings when measures can be implemented. In this paper, the use of a financial method called “equivalent annual cost” (EAC) is assessed to reduce that number of strategies and evaluate cost-optimal strategies. The use of EAC allows the comparison between short-term and long-term measures by expressing them into an annual interest weighted expected expenditure. As soon as a measure has to be implemented (i.e. the annual risk becomes too large or the safety standards are exceeded), the EAC for all combinations of measures is determined and the combination is implemented with the lowest EAC. This almost leads to cost-optimal flood risk reduction strategies that, by manual optimization, can be improved further. A case study has also been performed in the Hollandsche IJssel which proved the use of EAC. Here it has led to cost-optimal flood risk reduction strategies. The method is tested in one case and it is recommended to apply and test it in other cases as well.

http://resolver.tudelft.nl/uuid:073574cc-0130-492c-a72a-51c9b2038fc8

https://doi.org/10.1051/e3sconf/20160720005

EDP Science

Flood Risk 2016: 3rd European Conference on Flood Risk Management, Lyon, France. Lyon, France, October 17-21, 2016, 7

3rd European Conference on Flood Risk Management, FLOODrisk 2016, 2016-10-17 → 2016-10-21, Lyon Convention Centre, Lyon, France

E3S Web of Conferences, 2267-1242, 7 (20005)

Institutional Repository

conference paper

© 2016 M.A. Schoemaker, J.G. Verlaan, R Vos, M. Kok