Tuesday, January 1, 2013

The effect of street trees on property value in Perth, Western Australia

Trees provide a variety of benefits to urban residents that are implicitly captured in the value of residential properties. We apply a spatial hedonic model to estimate the value of urban trees in 23 suburbs of Perth Metropolitan Area in Western Australia. Results show that a broad-leaved tree on the street verge increases the median property price by about AU$16,889, suggesting a positive neighbourhood externality of broad-leaved trees. However, neither broad-leaved trees on the property or on neighbouring properties nor palm trees irrespective of the locations contributed significantly to sale price. Our result has potential implications on planting and maintaining broad-leaved trees on street verges for neighbourhood development and urban planning to generate public and private benefits of street trees.


► Effect of urban tree on property value differs depending on tree type and location.
► A broad-leaved tree on street verge increases property value by AU$16,889.
► Presence of trees on the property does not affect property value.
► Findings can be used for developing urban tree management policies.

Full-size image (92 K) 
Fig. 1. Map of the study area and locations of the observations.
by Ram Pandita, E-mail the corresponding author, Maksym Polyakovb, Sorada Tapsuwanc and Timothy Morand  
a School of Agricultural and Resource Economics, Faculty of Sciences, University of Western Australia, 35 Stirling Highway, Crawley, WA 6009, Australia Tel.: +61 8 6488 1353.  
b Centre for Environmental Economics and Policy (CEEP), School of Agricultural and Resource Economics, Faculty of Sciences, University of Western Australia, Australia  
c Resource Economist, CSIRO Ecosystem Science, Australia  
d Graduate Environmental Scientist, AECOM, Australia 
Landscape and Urban Planning via Elsevier Science Direct www.ScienceDirect.com  
Volume 110; February, 2013; Pages 134–142
Keywords: Broad-leaved trees; Spatial hedonic model; Property value; Street trees

The value of reducing eutrophication in European marine areas — A Bayesian meta-analysis

Abstract: One of the threats to the marine environment is eutrophication, which causes many adverse impacts that reduce human well-being. Determining the benefits of improving the state of marine areas has drawn increasing attention, especially with the establishment of the European Union Marine Strategy Framework Directive. However, existing knowledge of the benefits provided by marine ecosystem services in Europe is limited and context-specific. This study applies meta-analysis to summarize available information on the value of reducing eutrophication in European sea areas, and to provide welfare predictions for different scenarios. The challenges related to the small number of available studies are addressed by employing a Bayesian meta-regression. Several models are compared with prior and posterior predictive checks, and value predictions are estimated using Bayesian model averaging. The results indicate that the perceived benefits of reducing eutrophication in European marine areas can be considerable, with the predicted annual willingness to pay per person ranging from $6 for small local changes to $235 for substantial changes covering large sea areas. The findings suggest that values differ between marine regions, highlighting the importance of investigating previously unstudied geographical areas. As marine policy requires international cooperation, future studies would also benefit from collaboration between countries.


► Meta-analysis is used to summarize existing knowledge of the benefits of reducing eutrophication in Europe marine areas.
► Bayesian techniques are employed to address the challenges related to the small number of observations.
► Several models are compared with predictive performance checks and WTP predictions are done using Bayesian model averaging.
► The benefits of reducing eutrophication can be substantial, with the predicted WTP ranging from $6 to $235 per person. 
► Future valuation studies should be directed to previously unstudied geographical areas and international collaboration.
a MTT Agrifood Research Finland, Latokartanonkaari 9, 00790 Helsinki, Finland 
b Fisheries and Environmental Management Group, Department of Environmental Sciences, University of Helsinki, Finland
Ecological Economics via Elsevier Science Direct www.ScienceDirect.com
Volume 83; November, 2012; Pages 1–10
Keywords: Meta-analysis; Benefit transfer; Bayesian estimation; Eutrophication; Marine areas

Gasoline Prices, Fuel Economy, and the Energy Paradox

It is often asserted that consumers undervalue future gasoline costs relative to purchase prices when they choose between automobiles, or equivalently that they have high "implied discount rates" for these future energy costs. We show how this can be tested by measuring whether relative prices of vehicles with different fuel economy ratings fully adjust to time series variation in gasoline price forecasts. We then test the model using a detailed dataset based on 86 million transactions at auto dealerships and wholesale auctions between 1999 and 2008. Over our base sample, vehicle prices move as if consumers are indifferent between one dollar in discounted future gas costs and only 76 cents in vehicle purchase price. We document how endogenous market shares and utilization, measurement error, and different gasoline price forecasts can affect the results, and we show how to address these issues empirically. We also provide unique empirical evidence of sticky information: vehicle markets respond to changes in gasoline prices with up to a six month delay. 

by Hunt Allcott and Nathan Wozny
National Bureau of Economic Research (NBER) www.NBER.org
NBER Working Paper No. 18583; Issued in November 2012

Energy Department, ArcelorMittal Partnership Boosts Efficiency of Major Steel Manufacturing Plant

On December 17, 2012 Senior Advisor in the Office of Energy Efficiency and Renewable Energy Gil Sperling, joined local officials and company representatives for the ribbon cutting ceremony and tour of the ArcelorMittal steel manufacturing plant in East Chicago, Indiana. ArcelorMittal unveiled a new, energy recovery and reuse boiler that recycles waste gas generated through its ironmaking process and uses it to generate electricity to help power the plant.

The U.S. Department of Energy (DOE) awarded ArcelorMittal $31.6 million for their boiler project under the American Recovery and Reinvestment Act (ARRA), which was matched by the company. The company expects this energy recovery boiler to generate 333,000 megawatt hours of power annually of its own electricity, the equivalent of powering 30,000 American homes per year, and to save the facility nearly $20 million in energy costs each year. Senior Advisor Sperling highlighted the Obama Administration’s all-of-the-above strategy to strengthen U.S. competitiveness in clean energy manufacturing.

“Through investments in energy-saving technologies, such as innovative energy recovery and reuse systems, the Administration is taking steps to strengthen American manufacturing and boosting energy efficiency for businesses across the nation,” said Senior Advisor Sperling. “Cutting-edge energy efficiency projects help businesses cut costs, increase efficiency, and create strong, middle class jobs.”

An estimated 360 jobs were supported by the design, construction and manufacturing of the equipment for the project, most significantly the new boiler, which was made in Erie, Pennsylvania by Indeck Keystone Energy.  The project also employed 200 local construction workers at the plant site.  In addition, the new boiler makes the Indiana Harbor plant, the largest steel manufacturing facility in North America, more competitive in the global steel market.  Indiana Harbor employs approximately 6,000 workers.
Signed in August, the Executive Order builds on important steps the Administration has taken to scale up private sector investments in energy efficiency in our homes, buildings and factories with efforts like the Better Buildings Initiative.  The efforts outlined in the Executive Order could save manufacturers as much as $100 billion in energy costs over the next decade, improving their bottom lines and strengthening U.S. manufacturing competitiveness.

In addition, the Executive Order establishes a new national goal of 40 gigawatts of new combined heat and power (CHP) capacity – industrial waste heat capture systems – by 2020, a 50 percent increase from today. Meeting this goal would save American industry $10 billion per year, could result in between $40 billion to $80 billion in new capital investment in manufacturing and other facilities that would create American jobs, and would reduce emissions equivalent to 25 million cars.

The Energy Department’s advanced manufacturing R&D program, through the Innovative Manufacturing Initiative, also invests in next-generation technologies that have the potential to revolutionize conventional manufacturing processes down the road.  In partnership with the steel industry, DOE recently initiated a novel ironmaking project that will develop a process that sprays iron ore directly into the furnace chamber and uses natural gas or hydrogen as a reducing agent to replace the energy and capital intensive coke oven and blast furnace process steps - significantly reducing the energy costs, carbon footprint, production time, and capital and operating costs. 

The Energy Department's Office of Energy Efficiency and Renewable Energy accelerates development and facilitates deployment of energy efficiency and renewable energy technologies and market-based solutions that strengthen U.S. energy security, environmental quality, and economic vitality. Find out more about the Department's work to partner with industry, small business, universities, and other stakeholders to identify and invest in advanced manufacturing technologies with the potential to create high-quality domestic jobs and enhance the global competitiveness of the United States. And learn more about the Advanced Manufacturing Partnership, a government-wide effort to transform advanced manufacturing in the United States.
The Indiana Harbor Steel Mill encompasses about 3,400 acres of land
The total cost of the proposed project would be about $63.2 million. ArcelorMittal’s project involves construction and operation of a blast furnace gas recovery boiler to capture and use 46 billion cubic feet of blast furnace gas per year.
Prior to the new boiler, ArcelorMittal burned about 22% of the blast furnace gas from Indiana Harbor operations before releasing it to the atmosphere through an exhaust stack, a process called flaring. The company used the remaining 78% of the gas to power boilers. The new boiler project further reduces the amount of waste gas that is flared.
ArcelorMittal estimates the cost of preconstruction activities would be $13.1 million, and procurement, construction, and start-up cost would be an additional $50.1 million for a total cost of $63.2 million (ArcelorMittal undated). The estimated total direct earnings would be about $17.2 million. The effect of the total earnings impact by ArcelorMittal would be about $27.4 million in the region. Much of the construction-related spending would directly benefit the suppliers of equipment for the plant and the vendors who would provide materials and services for manufacture of the equipment. The 200 indirect jobs would include employees these companies would retain or hire.


U.S. Department of Energy (DOE) www.energy.gov
Press Release dated December 17, 2012

Assessment of ozone impacts on farming systems: A bio-economic modeling approach applied to the widely diverse French case

As a result of anthropogenic activities, ozone is produced in the surface atmosphere, causing direct damage to plants and reducing crop yields. By combining a biophysical crop model with an economic supply model we were able to predict and quantify this effect at a fine spatial resolution. We applied our approach to the very varied French case and showed that ozone has significant productivity and land-use effects. A comparison of moderate and high ozone scenarios for 2030 shows that wheat production may decrease by more than 30% and barley production may increase by more than 14% as surface ozone concentration increases. These variations are due to the direct effect of ozone on yields as well as to modifications in land use caused by a shift toward more ozone-resistant crops: our study predicts a 16% increase in the barley-growing area and an equal decrease in the wheat-growing area. Moreover, mean agricultural gross margin losses can go as high as 2.5% depending on the ozone scenario, and can reach 7% in some particularly affected regions. A rise in ozone concentration was also associated with a reduction of agricultural greenhouse gas emissions of about 2%, as a result of decreased use of nitrogen fertilizers. One noteworthy result was that major impacts, including changes in land use, do not necessarily occur in ozone high concentration zones, and may strongly depend on farm systems and their adaptation capability. Our study suggests that policy makers should view ozone pollution as a major potential threat to agricultural yields.

► Ozone impact on French agriculture is modeled for three 2030 climate scenarios.
► Ozone pollution impacts are spatially and temporally heterogeneous.
► An increase in barley production and a decrease in wheat production are simulated.
► Ozone impact reduces the agricultural gross margin, by 2% in the worst-case scenario.
► Ozone pollution reduces fertilizer use and thus GHG emissions.
Full-size image (16 K) 
Fig. 1. Ozone impact on wheat yield-to-nitrogen response function. Given the N-input, ozone leads to a decrease of yield (from the blue to the red curve) and therefore modifies the position of the economic optimum reached when the slope of the tangent to the curve is equal to the price ratio (selling price of the crop divided by the price of the N fertilizer). (For interpretation of the references to color in this figure legend, the reader is referred to the web version of this article.)
Full-size image (22 K) 
Fig. 3. Evolution of the mean AOT40 (in ppb) throughout the year in France for the 4 different Full-size image (121 K)
Fig. 8. Overview of the spatialized estimations of wheat and barley changes in production and gross margin variations. The maps present the variations for the two most extreme scenarios for 2030 (MFR and SRE) compared with 2001. The changes are presented in kilograms per hectare for a), b), c) and d) and in € per hectare for e) and f) (decrease: red, increase: green). (For interpretation of the references to color in this figure legend, the reader is referred to the web version of this article.)
Full-size image (17 K) 
Fig. 9. Variation in regional gross margin for the two extreme scenarios (2030-MFR: gray, 2030-SRE: black) compared with the year of reference (2001), for all regions. “MEAN” represents the average variation. The modeling predicts a considerable heterogeneity within the different regions.

National Coal Mining Museum Fits Solar Panels

The Wales’ National Coal Mining Museum located at Big Pit, Blaenavon, Nr Abergavenny in south Wales, now has 200 photovoltaic solar panels ... on the .. roof with another 200 solar panels installed on the National Collection Centre in Nantgarw.

[It gained its name from its particularly large elliptical 300 foot shaft. It  closed in February 1980 and in 1983 it re-opened as a museum.]  Since that time, the National Coal Mining Museum has seen well over 3 million visitors pass through its gates and it is now a World Heritage site. It is estimated that the solar panels will offset about £400,000 (~$650,000) during the next 25 years. The cost of about £70,000 (~$115,000) to install the panels, which was funded by the museum. The electricity generated will be used on site with any surplus being sold to the National Grid, which can produce additional income for the museum...
Big Pit National Coal Mining Museum 
Rafaƫl Delaedt / Wikimedia Commons

by Danielle Biggs from the Solar Panels UK
Renewable Energy World www.RenewableEnergyWorld.com
December 17, 2012

Toward Comprehensive and Multi-Modal Performance Evaluation

The U.S. Bureau of Transportation Statistic’s recently released National Transportation Statistics Report.... It is old-school, reflecting the assumption that our primary transportation problem is congestion delay. Of the nine tables in the Physical Performance section, four reflect air travel cancellations and delays, one reflects air travel baggage losses, and four are based on the Texas Transportation Institute’s congestion cost estimates.

What’s wrong with the BTS’s current approach? First, assumes that there are only two important modes of personal travel (commercial air and motor vehicle), that our main goal is to travel faster, and our main problem is that we are too often delayed. There is no consideration of other modes, goals or performance indicators such as availability, comfort and affordability. All congestion cost estimates are based on the Texas Transportation Institute’s calculations, without mentioning their weaknesses and biases, as discussed in a previous column, Toward More Comprehensive Understanding of Traffic Congestion.

Congestion is actually a modest cost overall. For example, the TTI’s most recent Urban Mobility Report estimates that in 2010 U.S. congestion caused 4.8 billion person-hours of delay and 1.9 billion gallons of additional fuel consumption, valued at $101 billion, this only averages 15.5 hours, 6.2 gallons and $327 per capita. The TTI methodology uses an unrealistic freeflow baseline speed (it assumes that all roads should always have level-of-service A; most economists argue that level-of-service C or D is actually more optimal under urban-peak conditions) and high travel time unit costs (they assume that congestion delay is worth $16.30/hr, although in practice, few motorists are willing to pay that much for incremental time savings), which bias their estimates upward. Applying more realistic analysis would reduce estimated congestion cost to approximately $110 per capita. This compares with about $4,000 in vehicle costs, $1,500 in crash damages, more than $1,000 in vehicle parking costs, $400 in roadway costs and $357 in environmental costs per capita.

Automobile dependency and sprawl tend to increase transport costs far more than traffic congestion, as discussed in Joe Cortright's report, Driven Apart: How Sprawl is Lengthening Our Commutes and Why Misleading Mobility Measures are Making Things Worse. For example, the TTI indicates that in 2010 Washington D.C. automobile commuters experience 74 average annual hours of congestion delay, but since only 43% of commuter in that region drive, this averages just 32 hours per commuter overall. In contrast, Houston automobile commuters experience 57 annual hours of delay, but since that region has a 88% auto mode share this averages 50 hours per commuter overall, much higher than Washington D.C. Cities with high quality public transit, such as New York, Boston and San Francisco, rate much better when congestion is measured per commuter rather than automobile commuter due to their low auto mode shares.

The TTI estimates that in the largest U.S. cities congestion causes 34 annual hours of delay and 16.5 gallons of additional fuel consumed per commuter. In contrast, according to analysis described in my report, Smart Congestion Relief, residents of automobile-dependent regions, who average more than 30 daily miles of vehicle travel, spend an estimated 104 additional hours and 183 additional gallons of fuel compared with more compact, multi-modal regions where residents average fewer than 20 daily vehicle-miles. This suggests that policies which stimulate sprawl impose more than three times the total cost as traffic congestion.

Fortunately, more comprehensive and multi-modal evaluation tools are now available for evaluating transportation system performance. For example, the Florida Department of Transportation’s new report, Expanded Transportation Performance Measures to Supplement Level of Service (LOS) for Growth Management and Transportation Impact Analysis critically evaluates current transport system performance indicators such as Roadway Level of Service (LOS) and identifies and evaluates more multi-dimensional and multi-modal transport system performance indicators. The report summarizes various examples from Florida cities that apply multi-modal transport system performance evaluation, and provides guidance for selecting and applying them in a particular situation.

Another approach is the National Association of Regional Council’s Livability Literature Review: A Synthesis Of Current Practice recently published by the U.S. Department of Transportation. It examines ways to define and evaluate livability and sustainability, and how they relate to various current planning concepts including smart growth, complete streets, lifelong communities, safe routes to schools, context sensitive solutions/design, new urbanism, transit-oriented development and placemaking. It provides a foundation for applying more comprehensive community planning, including more accessible development and multi-modal transport planning.

The New York City Department of Transportation’s very attractive report, Measuring the Street: New Metrics for 21st Century Streets discusses ways to evaluate urban street performance. It describes various urban street planning goals, strategies (specific ways to achieve goals) and metrics (specific ways to measure progress toward goals)
I have a few specific concerns about these documents. The Florida and NYC reports refer to sustainability, livability and accessibility without clearly defining the terms. Some goals and objectives (strategies) overlap. For example, some indicator sets tend to overweigh congestion impacts by including congestion reduction, improved freight transport and improved travel reliability objectives, while others overweigh energy consumption impacts by including energy conservation, local emission reductions, global emission reductions, and environmental quality. It is important to recognize how such double-counting can bias evaluation results.

Another concern is the poor way these indicators address social objectives such as affordability, basic mobility for non-drivers, and improved public health. These are all implied as goals, but I don’t think they are as well articulated or measured as economic objectives (congestion reduction, improved freight transport, agency cost efficiency, etc.) and environmental objectives (energy conservation, emission reductions, habitat preservation, etc.). This area needs more research and guidance.
Todd Litman's Blog at Planetizen http://www.planetizen.com/blog/2394
November 27, 2012