Modern Cost–Benefit Analysis of Hydropower Conflicts

Modern Cost–Benefit Analysis of Hydropower Conflicts

Edited by Per-Olov Johansson and Bengt Kriström

This important book sheds light on the ways in which modern tools of welfare economics can be used to assess the benefits and costs of resource conflicts involving hydropower. The chapters highlight key methodological issues in this area; ranging from the intersection between cost–benefit analysis and behavioral economics, to the value of load balancing services provided by hydropower. The inclusion of insights from expert contributors from both sides of the Atlantic brings a unique and interesting range of viewpoints to the work.

Chapter 3: Recreational Benefits of Removing Dams and Restoring Free-flowing Rivers: An Example Micro-Meta-Analysis of the Contingent Visitation Benefits of Removing Dams

John Loomis

Subjects: economics and finance, environmental economics, environment, environmental economics, water

Extract

3. Recreational benefits of removing dams and restoring free-flowing rivers: an example micro-metaanalysis of the contingent visitation benefits of removing dams John Loomis INTRODUCTION 1 Hydroelectric dams are touted for producing electricity with no air pollution (and now, no carbon emissions too) and using the renewable hydrologic cycle. However, this does not imply that hydropower is externality free. As noted by the World Commission on Dams (2000), that while dams have made important contributions to human development, in many cases they have resulted in unacceptable environmental costs. For example, hydropower dams and water diversions through penstocks frequently block fish migration, often reduce river flows and usually disrupt the natural hydrograph (Stanley and Doyle, 2003). Growing populations have resulted in increased demand for river recreation, and many countries have also passed laws to protect declining endangered species. The joint effect of these two changes has been increasing pressure to remove old dams built in the early 1900s, and even some more recent dams such as those constructed in the last 30–40 years (e.g., the four dams on the Lower Snake River in Washington State). Whether it is economically efficient to remove the dams is, of course, a comparison of benefits to costs. The benefits of many of the dams are declining due to siltation and the expense of replacing old inefficient turbines. The costs of retaining the dams are rising with the increasing demand for river recreation, and growing public benefits associated with restoring declining salmon populations and other endangered...

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