Evaluating Alternatives

Kinds of effects

An effect can be described as a change in the existing situation that result from an action. Effects of alternatives are determined by taking the difference between the realization of an alternative and the reference situation. Commonly, the zero-situation is taken as reference. Effects can be grouped as follows:

  • aimed and side effects;
  • direct and indirect effects.

Effect forecasting

Experience plays an important role with the prediction of effects. Based upon experience, relationships between effects can be determined. With the prediction of effects of alternatives, it is needed that these relationships can be made explicit and that can be indicated to which extent a certain change in one effects influences the other. This can both be quantitative and qualitative. (further reading)

Cost of an alternative

To implement an alternative, manpower, money and natural resources are needed. These could also be used for other activities. In other words, another activity can (partly) not be implemented to realize the project under consideration. In fact, the benefits related to such other activity are to be included in the evaluation as cost for the current project. These are so-called opportunity costs or alternative costs. (further reading)

Monetary methods

Monetary methods aim at providing a quantitative overview of all positive and negative effects of alternatives. These effects are expressed as much as possible in monetary terms: costs and benefits. In Coastal Zone Management projects, such monetary methods are used to indicate the socio-economic effects: they include positive and negative effects of those who are not directly involved in the project. Thus, alternatives are ranked on the basis of their socio-economic rentability. Common used selection/decision criteria of monetary methods are: Benefit-Cost (B/C) ratio and the Internal Rate of Return (IRR). (further reading)

Are the following statements correct or not:

To prevent dune erosion, the beach is nourished. The beach becomes broader and attracts more tourists; this is a side-effect.
When studying coastal protection measures, to apply beach nourishments is an alternative. Sand can be used that is being dredged from a nearby access channel. The dredging costs don’t have to be taken into account in the analyse as they are sunk-costs.
A government chooses to use a dune area for water treatment plants. The area is also very suitable for recreation, but there is no access road. The land is already public property, so, the total costs of the development will only be 100,000 dollar to build the plant and connect it to the existing water service pipes.