WSD economic analysis Print

Design Outcome

​​​Life cycle costing (LCC) is defined by the Australian/New Zealand Standard 4536 as "the process of assessing the cost of a product over its life cycle or portion thereof". 

​These LCC models are more robust for stormwater management if they take into account replenishment costs to renew practices, and decommissioning costs to dispose of or recycle material elements (Ira et al., 2008). LCC assists with the prioritisation of immediate and long-term investments, taking into account up-front acquisition costs, cumulative interest on payments, and linking with long-term funding cash cycles such as the LTP and Annual Plans. 

​There are clear advantages to WSD approaches when considered under an LCC analysis, an approach already used to evaluate a 'best practicable option' for stormwater management. A clustered WSD form of development will have reduced infrastructure overall, with associated lower capital and renewal costs over the life cycle of these systems. There is an expectation that up-front costs for WSD practices will also reduce in the near future as there is a greater uptake of WSD approaches providing for more readily available, less expensive off-the-shelf solutions, and specialised design services and construction materials. 

Restored ecosystems, as part of WSD approaches, are likely to have reducing maintenance costs over time and increased performance of stormwater management as vegetation and soils mature and stream channels reach equilibrium. Natural processes in WSD devices such as raingardens and swales are likely to continue operating for the life of a development if they are provided with effective preventative maintenance.
Cost-benefit analyses 
​A cost-benefit analysis considers the LCC against quantifiable benefits. The potential broader economic returns offered by WSD and consideration of ecosystem goods and services include: 
  • Water quality benefits leading to contact recreation, fisheries and tourism economies 
  • Optimisation of land that is marginal for development but contributes to open space networks and stormwater management 
  • Increased property values associated with desirable WSD developments ​
  • Ecosystem goods and services with associated economic benefits 
  • Cultural and spiritual services including connection to place and indigenous biodiversity, enhancing the attractiveness of a development. 

​Non-financial outcomes can also be included in a cost benefit analysis, where they can be quantified and given an appropriate weighting. For example, the restoration of a lowland stream corridor could be quantified by 'habitat units', such as the length or area of restored stream corridor available to a particular species. A measurable benefit could be a standard of contact recreation that the public has previously shown a willingness to pay for, which can lead to higher property values.

Ongoing work initiated by Auckland Council will continue to contribute to the understanding of costs and benefits associated with WSD approaches in both greenfield and brownfield developments, and to add to the information already published in the Auckland Council Technical Report TR2013/043 Auckland Unitary Plan Stormwater Management Provisions: Cost and Benefit Assessment.​​​

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