Public Interest Economics
Typically, both public and private decision makers lack all the information necessary for determining whether or not a proposed program, policy, or project is in the public interest. Our economists help expose the true costs of these decisions on the public as well as benefits that may be important but are difficult to quantify through standard economic analysis techniques. Our expertise includes non-market valuation, benefit-cost analysis, regional modeling, and other techniques needed to provide a more complete picture of overall economic impact.
Some recent examples of our public interest economics work include:
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Economic Feasibility of Coal to Liquids Development in Alaska’s Interior
The Northern Alaska Environmental Center retained CSE to provide an independent critique of two economic studies published by the National Energy Technology Lab and Hatch, Ltd. in support of coal-to-liquids plants in the Fairbanks region. The study considered CTL development from a net public benefits perspective, and concluded that economic feasibility is highly unlikely because the net present value of public investments are likely to be well less than zero and benefit-cost ratios well less than one. CSE’s report considered all relevant public and private costs, including natural resource damages, carbon emissions, and public subsidies – costs excluded from both the NETL and Hatch reports. The CSE report also corrected inaccurate assumptions contained in the economic analysis such as 100% plant availability and coal prices significantly less than what is being quoted by the coal supplier. Read:
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Fort Huachuca and the San Pedro River: Improving Water Deficit Liability Calculations Through Economic Modeling
Arizona’s San Pedro River is one of the nation’s hotspots of biological diversity, providing critical habitat for over 350 species of birds, 80 mammals, two native and several introduced species of fish, and more than 40 species of amphibians and reptiles Groundwater pumping jeopardizes the health of the river, and Ft. Huachuca is by far the biggest culprit. CSE completed a study for the Center for Biologcial Diversity that points out serious shortcomings of Ft. Huachuca’s population-based method for establishing its groundwater deficit liability and responsibility for mitigation. While Ft. Huachuca claims its liability may be as low as 35%, economic modeling suggests its liability is more likely to be in the range of 80%. Read:
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Benefit-Cost Analysis of the Delong Mountain Terminal Project: Critique and Independent Assessment of Key Parameters
On the far northwestern arctic coast of Alaska, the Army Corp of Engineers and the Alaska Industrial Export Authority are pursuing a plan for major expansion of the Delong Mountain port to accommodate deep draft vessels servicing the Red Dog lead mine and to increase imports of oil from Singapore. The plan jeopardizes subsistence use by nearby residents of the Alaska village of Kivalina and sensitive marine mammal habitat. Working with the Northern Alaska Environmental Center, CSE has completed a critique of the Corps benefit-cost analysis and a reassessment that takes into account carbon emissions damage, loss of subsistence use, loss of marine mammal habitat and other non-market costs as well as more realistic assumptions regarding fuel prices. The assessment has determined that costs may exceed benefits by a factor of five. Read:
