A Comprehensive Framework for Valuation of Ecosystem Services in the Context of Hydropower

Technical Report · Wed Sep 01 04:00:00 EDT 2021

DOI:https://doi.org/10.2172/1844296· OSTI ID:1844296

Ganguli, Sumitrra ^[1]; Wilson, Kyle D. ^[1]; Anderson, David M. ^[1]

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1. Pacific Northwest National Lab. (PNNL), Richland, WA (United States)

While models to value ecosystem services exist, they suffer from a lack of “portability” in the sense that a single modelling framework developed for one site cannot be imported and applied to another. Additionally, benefit estimations are often fragmented, incomplete, incomparable, and in heterogenous metrics, thus preventing aggregation to arrive at one comprehensive value. In the context of hydropower, the methods, as well as the metrics used to value the associated ecosystem services, vary between stakeholders (e.g., competing water users, agencies, etc.), detracting from the ability to assess the total value of a hydropower project, water management schemes, or comparing value between competing water users. Further, current methods to value water neglect non-market ecosystem services’ values by failing to account for externalities, resulting in misallocation of costs (e.g., obligatory stakeholder payments for water use) and misinterpretation of hydropower benefits. The benefit-cost ratios in hydropower development are often incomplete because non-market benefits are excluded (e.g., benefits, such as fish habitat resiliency and agricultural water reliability, derived from hydropower development). An approach to enable consistent, standardized hydropower benefit-cost analyses does not currently exist. This paper conceptualizes a methodology to standardize ecosystem services valuation in the context of hydropower projects through the integration of the U.S. Environmental Protection Agency’s existing Final Ecosystem Goods and Services Classification System framework and economic valuation techniques, and demonstrates the applicability of this methodology through a limited proof-of-concept application (the New Waddell Plant, a pumped hydroelectric energy storage facility in Phoenix, AZ). The beauty of our proposed framework lies in its ability to be imported and applied to any other pumped storage facility after accounting for site-specific features.

• Research Organization: Pacific Northwest National Laboratory (PNNL), Richland, WA (United States)
• Sponsoring Organization: USDOE
• DOE Contract Number: AC05-76RL01830
• OSTI ID: 1844296
• Report Number(s): PNNL-32132
• Country of Publication: United States
• Language: English

Related Subjects

13 HYDRO ENERGY
29 ENERGY PLANNING, POLICY, AND ECONOMY
benefits transfer
ecosystem services
valuation framework