Cost-benefit analysis for non-structural flood risk mitigation measures: Insights and lessons learnt from a real case study

Cost-Benefit Analysis (CBA) in flood risk management is becoming increasingly popular as a tool that makes the relationship between investments in mitigation measures and the related effects more comprehensible. Even if the application of CBA in flood risk management is nothing new, there is still limited evidence on its use conditions and possible limits when applied in real. The essay first suggests a new classification of Flood Mitigation Measures (FMM), towards a new taxonomy that goes beyond the distinction between structural and non-structural. This distinguishing between risk and damage reduction measures, public and private decision-making processes, mandatory and voluntary actions and allocating more importance to the value of the avoided damages related to the commons (i.e. cultural heritage) and other non-renewable, non-reproducible or non-restorable territorial resources. Second, the contribution of CBA as an ex-ante decision-making tool in flood risk reduction is discussed. Moreover, the essay offers a methodological insight and operational elements as results of a case study developed in the European research project IDEA, where a CBA for a non-structural mitigation measure was performed using the data and information available after the 2012 and 2013 flood events in the Umbria Region (Italy). Here, dams built to produce hydroelectric power have been used for laminating the floods, as a non-structural risk mitigation measure. The experimental application of the CBA to this measure, including the combination of real damage data collected after the floods and damage modeling for the alternative scenario, provided methodological and operational evidence of its capability to reduce/avoid a part of the damage. Finally, the essay presents the lessons learnt, the open problems and future developments required for an effective CBA, in reference to the technical and scientific perspective and to the difficulties in the understanding and interpretation of the whole of the cause-effect chains and externalities.