A framework for pricing the loss of regulating ecosystem services caused by road construction

• Published in: KSCE journal of civil engineering Vol. 20; no. 7; pp. 2624 - 2631
• Main Authors: Kim, Byungil, Kim, Hongjo, Kim, Hyoungkwan
• Format: Journal Article
• Language: English
• Published: Seoul Korean Society of Civil Engineers 01.11.2016; Springer Nature B.V; 대한토목학회
• Subjects: Accounting; Carbon; Carbon capture and storage; Carbon sequestration; Civil Engineering; Construction; Construction costs; Construction industry; Cost benefit analysis; Cost engineering; Decision analysis; Decision making; Ecosystem services; Ecosystems; Engineering; Environmental Engineering; Floods; Geotechnical Engineering & Applied Earth Sciences; Highway construction; Industrial Pollution Prevention; Market prices; Mitigation; Pricing; Project engineering; Road construction; Roads; Sustainable development; Water storage; 토목공학; Korea, Rep; ecosystem service; ecosystem; road; cost-benefit analysis
• ISSN: 1226-7988; 1976-3808
• DOI: 10.1007/s12205-015-0762-9

Road construction is a primary cause of the loss of ecosystems and their services. However, such loss of ecosystem services has not been reflected in key decision-making processes, such as in cost-benefit analysis due to difficulty in pricing the cost. This study proposes a framework for pricing the loss of regulating ecosystem services caused by road construction. Two important characteristics of the proposed framework are the adoption of the replacement cost method and the use of limited information in the planning phase of road projects. A case study was conducted to validate the proposed framework, with an emphasis on carbon sequestration, flood mitigation, and water storage services, based on 49 typical road construction projects in the Republic of Korea. On average, the costs of the loss of carbon sequestration, flood mitigation, and water storage services were estimated to be 5,055, 6,412, and 8,004 in units of $/lane-km, respectively, and the total costs were estimated to be an average of 19,474 $/lane-km, accounting for 0.47% of the direct construction cost. These findings are the effort for pricing the loss of ecosystem services caused by road construction from an engineering perspective. The proposed framework can be used to provide clear guidance for sustainable development.