Wednesday, June 14, 2023

Life Cycle Air Pollution, Greenhouse Gas, and Traffic Externality Benefits and Costs of Electrifying Uber and Lyft

Transportation network companies (TNCs), such as Uber and Lyft, have pledged to fully electrify their ridesourcing vehicle fleets by 2030 in the United States. In this paper, Aniruddh Mohan, Matthew Bruchon, Jeremy Michalek, and Parth Vaishnav introduce AgentX, a novel agent-based model built in Julia for simulating ridesourcing services with high geospatial and temporal resolution.  The authors then instantiate this model to estimate the life cycle air pollution, greenhouse gas, and traffic externality benefits and costs of serving rides based on Chicago TNC trip data from 2019 to 2022 with fully electric vehicles. They estimate that electrification reduces life cycle greenhouse gas emissions by 40–45% (9–10¢ per trip) but increases life cycle externalities from criteria air pollutants by 6–11% (1–2¢ per trip) on average across our simulations, which represent demand patterns on weekdays and weekends across seasons during prepandemic, pandemic, and post-vaccination periods. A novel finding of their work, enabled by their high resolution simulation, is that electrification may increase deadheading for TNCs due to additional travel to and from charging stations. This extra vehicle travel increases estimated congestion, crash risk, and noise externalities by 2–3% (2–3¢ per trip). Overall, electrification reduces net external costs to society by 3–11% (5–24¢ per trip), depending on the assumed social cost of carbon.
by Aniruddh Mohan, Matthew Bruchon, Jeremy Michalek, and Parth Vaishnav 
Environmental Science & Technology via ACS
Volume 57, Issue 23, pages 8524–8535; Publication Date: June 1, 2023

Tuesday, June 13, 2023

The regional economic impact of wildfires: Evidence from Southern Europe

Sarah Meier, Robert J.R. Elliott and Eric Strobl estimate the impact of wildfires on the growth rate of gross domestic product (GDP) and employment of regional economies in Southern Europe from 2011 to 2018. To this end the authors match Eurostat economic data with geospatial burned area perimeters based on satellite imagery for 233 Nomenclature of Territorial Units for Statistics (NUTS) 3 level regions in Portugal, Spain, Italy, and Greece. Their panel fixed effects instrumental variable estimation results suggest an average contemporary decrease in a region’s annual GDP growth rate of 0.11–0.18% conditional on having experienced at least one wildfire. For an average wildfire season this leads to a yearly production loss of 13–21 billion euros for Southern Europe. The impact on the employment growth rate is heterogeneous across economic activity types in that there is a decrease in the average annual employment growth rate for activities related to retail and tourism (e.g., transport, accommodation, food service activities) of 0.09–0.15%, offset by employment growth in insurance, real estate, administrative, and support service related activities of 0.13–0.22%.
Journal of Environmental Economics and Management via Elsevier Science Direct
Volume 119; May, 2023, Pages 102823

Conducting techno-economic analyses of early-stage designs for net-zero water and energy affordable homes

Purpose: This study aims to provide and illustrate the application of a framework for conducting techno-economic analyses (TEA) of early-stage designs for net-zero water and energy, single-family homes that meet affordable housing criteria in diverse locations. 

Design/methodology/approach: The framework is developed and applied in a case example of a TEA of four designs for achieving net zero-water and energy in an affordable home in Saint Lucie County, Florida. 

Findings: Homes built and sold at current market prices, using combinations of well versus rainwater harvesting (RWH) systems and grid-tied versus hybrid solar photovoltaic (PV) systems, can meet affordable housing criteria for moderate-income families, when 30-year fixed-rate mortgages are at 2%–3%. As rates rise to 6%, unless battery costs drop by 40% and 60%, respectively, homes using hybrid solar PV systems combined with well versus RWH systems cease to meet affordable housing criteria. For studied water and electricity usage and 6% interest rates, only well and grid-tied solar PV systems provide water and electricity at costs below current public supply prices. 

Originality/value: This article provides a highly adaptable framework for conducting TEAs in diverse locations for designs of individual net-zero water and energy affordable homes and whole subdivisions of such homes. The framework includes a new technique for sizing storage tanks for residential RWH systems and provides a foundation for future research at the intersection of affordable housing development and residential net-zero water and energy systems design.
The total cost for a home with well and septic systems, when connected to the public electricity grid rather than having a solar PV system, is taken as $230,000. This cost was determined as the average sales price, per county property appraiser records, for newly constructed, model and spec homes of 1,100–1,400 ft2 in size (the size of the proposed affordable home ± 12%), that include onsite well and septic systems and the other passive design features identified in the present research, sold in 2020 and 2021 in Saint Lucie County, FL .

It is assumed that the only differences in costs using a well versus RWH system to achieve net-zero water are the differences in the costs associated with drilling and installing the casing for the well versus purchasing and installing the aboveground galvanized steel storage tank for the RWH system. It is assumed the costs for piping, filtering, disinfection and pumping in the two designs are the same.
Well drilling and casing costs in the state of Florida are estimated to be between $26 and $58 per foot (CVFPB, 2022). Using the highest figure and assuming a well depth of 200 feet provide an estimated cost for well drilling and casing of $11,600. A review of prices for water storage tanks offered by multiple manufacturers indicates that a reasonable cost for a 30,000-gallon (113.56 m³) aboveground galvanized steel water storage tank is $28,600 [5]. Thus, the total cost for a home with RWH and septic systems, when connected to the public electricity grid rather than having a solar PV system, is $230,000–$11,600 + $28,600 = $247,000.

Monday, June 12, 2023

Policy evaluation of waste pricing programs using heterogeneous causal effect estimation

Using machine learning methods in a quasi-experimental setting, Marica Valente studies the heterogeneous effects of introducing waste prices – unit prices on household unsorted waste disposal – on waste demands and municipal costs. Using a unique panel of Italian municipalities with large variation in prices and observables, she shows that waste demands are nonlinear. The author finds evidence of constant elasticities at low prices, and increasing elasticities at high prices driven by income effects and waste habits before policy. The policy reduces waste management costs in all municipalities after three years of adoption, when prices cause significant reductions in total waste.
A growing number of municipalities have implemented Pay-As-You-Throw (PAYT) programs that require households to pay for each unit (per bag, can, or weight) of unsorted waste presented for collection.... Empirical estimates provide mixed evidence on the magnitude of PAYT average effect on unsorted waste as well as on possible indirect causal effects on recycling and total waste. Moreover, policy impacts may vary across municipalities depending, e.g., on the adopted price level and socio-economic characteristics.... In light of this, heterogeneity in causal effects plays an essential role in evaluating policy efficacy, allowing to ascertain subpopulations for which the policy is most beneficial and to generalize estimates to a new target population. On top of this, heterogeneous causal effect estimates can be combined with municipal waste management costs to deliver heterogeneous cost–benefit evaluations of waste policies.

In this paper, Valente examines heterogeneous demand responses to waste prices, and their impact on municipal waste management costs. The main challenge in the analysis is that determinants of waste generation and policy adoption are possibly many, and may confound the estimation of causal effects. This motivates the collection of a unique panel of municipalities with a large variation in prices and observables, and the estimation of municipal level causal effects of prices (continuous treatment) via machine learning methods....
The author estimates policy effects on municipal costs for each municipality by combining price causal effects on unsorted and recycling waste with their impacts on waste management costs. She finds that waste prices decrease municipal costs for all municipalities especially in the long-term (after three adoption years) when municipalities show the highest reductions of total waste.
Municipalities generate relatively more Recycling Waste (RW) than Unsorted Waste (UW) on average. Managing one unit of UW costs on average twice as much as RW. However, municipal unit costs are largely heterogeneous, and for some of these municipalities (40%) unit costs of RW are higher than those of UW. Table 1 also shows that average costs for UW are slightly higher in per capita terms. Per capita costs indicate that one individual on average spends about €100 per year for waste services, and pays the most for unsorted waste. This implies that UW reductions that do not translate into RW increases will potentially drive cost savings for both households and municipalities. Previous studies point to education and income levels as key determinants of policy adoption and effectiveness.... In her sample, PAYT is implemented in municipalities with on average slightly higher income and comparable education levels.
Using prices and UW post-policy, she calculates household variable costs in each municipality. In the third policy year, households in high-price municipalities (>13 cents) pay on average €176 per capita. In low-price municipalities (<3 cents), they pay on average €21 per capita. 
Policy effects on municipal costs are mostly positive. However, waste prices raise municipal costs in a fraction of municipalities where the reduction of unsorted waste is largely driven by an increase in recycling, and management costs of recycling are high compared to those of unsorted waste. In year 3, PAYT generates cost savings in all municipalities. Average savings are €20 per capita, which is about one fifth of what municipalities spend for waste management per person on average. As management unit costs are largely unaffected, savings come from UW reductions that do not translate into higher RW. In other words, municipal cost savings are largely driven by total waste reductions.

Friday, June 9, 2023

Tree cover and property values in the United States: A national meta-analysis

[A meta-analysis by Kent Kovacs, Grant West, David J. Nowak and Robert G. Haight] uses 21 hedonic property value studies and 157 unique observations to study the influence of tree cover on the value of homes in the United States. The authors construct elasticity estimates of the percentage change in home value for a 1% change in the percentage of tree cover around a home. Cluster weighted averages of the elasticities account for the housing market and the precision of the property price effects for tree cover on and off property and for three categories of tree cover density. Meta-regression models further control for the housing market and tree cover heterogeneity, the methodological techniques of the primary study, and publication bias. The Mundlak meta-regression model with controls for US regions has the lowest out-of-sample transfer error. The larger elasticity for off property tree cover than on property tree cover (unless tree density is 10% or lower) suggests that the property value of homes rises more if tree cover is not on land that homeowners are responsible for maintaining. The elasticity in neighborhoods with greater than 25% tree cover (0.013) is four times larger than the elasticity in neighborhoods with 0 to 10% tree cover (0.003).
Their Mundlak model 2 predicts an $8.88 increase in the value of a single-family home in the Midwest for an on-property increase in tree cover of 0.18%.6 Assuming that the single-family home is on a half-acre lot (21,780 ft2) with an average tree cover of 18% (3920 ft2) (Table 2), they find that a 1% increase in the percentage tree cover amounts to an increase of 39 ft2. Suppose that a 24-in. dbh green ash tree has a crown radius of 35 ft. and a crown area of 962 ft2. A 1% increase in tree cover is equivalent to 0.04 additional 24-in. green ash trees on the property (39/962 = 0.04). The increase in property value for one green ash tree on the property is $8.88/0.04 = $222. Their Mundlak model 2 also predicts a $76.2 increase in the value of a single-family home in the Midwest for a 0.18% increase in tree cover within a mile of the home. A circular area with 1-mile radius has 87.6 million ft2. Using the average tree cover of 18% (Table 2), they find that trees cover 15.8 million ft2, and a 1% increase in the percentage tree cover amounts to an increase of 158,000 ft2. Suppose again a 24-in. dbh green ash tree has a crown radius of 35 ft. and a crown area of 962 ft2. A 1% increase in tree cover is equivalent to 164 additional 24-in. dbh green ash trees within a mile of the home (158,000/962 = 164).
What is the total value of a 1% increase in tree cover in a neighborhood? Here, [they] need to calculate the increase in value of all the homes in the neighborhood, and so [they] need an estimate of housing density. According to the 2019 US Census, there are 2,176 households per square mile in St. Paul, MN. If we assume the neighborhood is a circular mile in size, then there are 2176 * 3.14 = 6833 homes in the neighborhood (there are 3.14 mile2 in a circular mile). If each home benefits from the 1% increase in tree cover in the circular area, then the aggregate increase in property value is 6833 * $76.2 = $520,675, for the off-property component of the tree cover. In addition, the aggregate increase in property value is 164 * $222 = $36,408 for the on-property component of tree cover, again assuming the 1% increase in tree cover is composed of 164 24-in. dbh ash trees. Adding those two components, the total value of a 1% increase in tree cover in the circular mile area is $557,083 or $277 per acre of land.

by Kent Kovacs, Grant West, David J. Nowak and Robert G. Haight
Ecological Economics via Elsevier Science Direct
Volume 197, July 2022, 107424

Estimating the benefits of stream water quality improvements in urbanizing watersheds: An ecological production function approach

Streams are under significant ecological stress in rapidly urbanizing watersheds around the world. However, estimates of the combined use and nonuse benefits of improving urban stream water quality, which are critical for guiding policy, are generally lacking. To address this gap, Roger H. von Haefen, George Van Houtven, Alexandra Naumenko, Daniel R. Obenour, Jonathan W. Miller, Melissa A. Kenney, Michael D. Gerst and Hillary Waters develop an ecological production framework that is tailored to urban stream stressors, conditions, human uses, and preferences in the Piedmont ecoregion of the United States and that allows analysts to translate changes in measurable water quality indicators into monetary benefit estimates. An application of the framework to illustrative policy scenarios in an urban county of North Carolina indicates that these benefits can be substantial, and it provides a template for expanding the methods and findings geographically.

Streams in urbanizing watersheds are threatened by economic development that can lead to excessive sediment erosion and surface runoff. These anthropogenic stressors diminish valuable ecosystem services and result in pervasive degradation commonly referred to as “urban stream syndrome.” Understanding how the public perceives and values improvements in stream conditions is necessary to support efforts to quantify the economic benefits of water quality improvements. The authors develop an ecological production framework that translates measurable indicators of stream water quality into ecological endpoints. Their interdisciplinary approach integrates a predictive hierarchical water quality model that is well suited for sparse data environments, an expert elicitation that translates measurable water quality indicators into ecological endpoints that focus group participants identified as most relevant, and a stated preference survey that elicits the public’s willingness to pay for changes in these endpoints. To illustrate our methods, we develop an application to the Upper Neuse River Watershed located in the rapidly developing Triangle region of North Carolina (the United States). Their results suggest, for example, that residents are willing to pay roughly $127 per household and $54 million per year in aggregate (2021 US$) for water quality improvements resulting from a stylized intervention that increases stream bank canopy cover by 25% and decreases runoff from impervious surfaces, leading to improvements in water quality and ecological endpoints for local streams. Although the three components of our analysis are conducted with data from North Carolina, we discuss how their findings are generalizable to urban and urbanizing areas across the larger Piedmont ecoregion of the Eastern United States.

by Roger H. von Haefen (, George Van Houtven, Alexandra Naumenko, Daniel R. Obenour, Jonathan W. Miller, Melissa A. Kenney, Michael D. Gerst and Hillary Waters 
Proceedings of the National Academy of Sciences
Volume 120, Number 18; accepted January 20, 2023; published by April 24, 2023