THE ECONOMICS OF LOW IMPACT STORMWATER MANAGEMENT

1. THE ECONOMICS OF LOW IMPACT STORMWATER MANAGEMENT GLENCOURT PLACE Éva-Terézia Vesely Jan Heijs Chris Stumbles David Kettle

2. In this presentation … • Context – Background information • Methodology – LCC • Results • Discussion

3. Urban Stream Health Compromising factors: • Modified flow • Poor water quality • Lack of physical habitat • Lack of riparian vegetation • Barriers to migration of fish and other biota • Exotic plants and animals • Channelisation, erosion and sedimentation

4. Framework for Stream Restoration Christopher J. Walsh – Cooperative Research Centre for Freshwater Ecology, Monash University, AU: Low impact urban design approaches that reduce drainage connection are the most effective management solution to the protection of stream biota in urban catchments.

5. Windows of Opportunity for Low Impact Design Age Distribution infrastructure inertia STORMWATER INFRASTRUCTURE REPLACEMENT lock in effects / path dependency Typical Lifetime windows of opportunity to explore alternative design

6. Background information • Location: Windy Ridge, North Shore City • Sub-catchment size: 2.6 ha • Historical disposal: soakage (soakpits) • The problem: serious overland flow problems

7. Two approaches … 1. The conventional approach reticulating the area with stormwater pipes and/or flowpaths 2. The low impact approach using an engineered system of gravel trenches, contoured flowpaths and minimal piping backed up with raintanks retrofitted to existing properties Photo by Nadine Wakim

8. Methodology • Compare the Life Cycle Costs of the two approaches • Reveal aspects that impose higher costs on the low impact approach • Highlight changes and potential for future cost savings

9. Life Cycle Costing Australian and New Zealand Standard (AS/NZS 4536:1999) Life cycle costing is the process of assessing the cost of a product over its life cycle or portion thereof. Life cycle cost is the sum of acquisition and ownership costs of an asset over its life cycle from design stage through manufacturing, use, maintenance and disposal.

10. Life Cycle Costing

11. Assumptions for the LCC • Timeframe: 50 to 100 years • Type of cost: real costs with 2005 as base year • Discount rates: 3.5% and 10% real discount rates • Water savings: 125$/raintank/year

12. Acquisition Costs • Conventional - based on the pipe layout used for the initial engineering costing - new costing data from recent contracts • Low Impact - cost data from the construction contracts - NSCC accounting data - costs occurred before 2005  2% inflation factor

13. Renewal Costs • Pumps replaced every 10 years at NZ$600 • Raintanks replaced every 25 years at NZ$2350

14. Operation and Maintenance Costs • Conventional - maintenance pipe: NZ$ 1/linear meter pipe • Low Impact - maintenance pipe: NZ$ 1/linear meter pipe - operation of one pump: NZ$ 10/year - maintenance of one pump: NZ$ 20/year - maintenance of one raintank: NZ$ 80/year - raintank registry and inspection: NZ$ 10/raintank/year - maintenance gravel trench and channel: -

15. Not quantified • Decomissioning costs • Cost of land • Risk costs Photo by Nadine Wakim

16. Results

17. Results

18. Results

19. Lessons • LCC a useful analytical tool for: • comparing different options • potentially improve design • highlight the importance of pre-acquisition costs • budgeting • cost sharing • assess financial sustainability

20. Looking behind the numbers … • In favour: • Staff interest / commitment • Lack of conventional infrastructure in place • Commitment to low impact at strategic level (NSCC Stormwater Strategy 2004) • Funding opportunities (Infrastructure Auckland funding)

21. Looking behind the numbers … • Disadvantages / Changes: • Expertise and experience with the conventional approach • Lack of expertise and experience with the low impact approach • Experience building up (pilot projects) • Public perceptions •  Experience building up with the consultation process • Technical uncertainties •  Technical flexibility exposed

22. Looking behind the numbers … • Disadvantages / Changes: • Standard restrictions • Restrictions removed • Lack of legal arrangements • Legal arrangements sorted • High perceived risk associated with assuring continuous operation and maintenance •  Stormwater Policy: Responsibilities for Stormwater Infrastructure

23. Investment in eco-innovation • The novelty of the project translated into higher costs for design, project management and consultation. • These costs are expected to drop in the future. • The externalities remained out of the scope of this analysis. • Market distortions will impact such analysis.

24. Dynamic framework • Criteria • Performance against these criteria are changing. • Increased data availability on cost elements • Changing public attitudes • Future water prices Performance against the COST MINIMISATION criterion

25. Acknowledgements The authors are grateful to Nadine Wakim, Barry Carter, Frank Tian, Viv Eyberg and Ban Aldin for insightful discussions.