A case study of 21 pre-disaster mitigation projects involving utility and transportation infrastructure found that most produced at least $2, and one offered as much as $31, in benefits for every $1 spent.
In a report published Oct. 30, the National Institute of Building Sciences, or NIBS, reviewed the costs and lifetime benefits of flood, wind and earthquake mitigation projects, including 12 undertaken through grants from the Economic Development Administration, as well as nine additional mitigation projects. The study builds on a report that NIBS released in April, which found that every $1 spent on pre-disaster mitigation subsequently saves $6 in disaster costs.
Climate scientists, including those with the United Nations' Intergovernmental Panel on Climate Change, predict that the world will see an uptick in the number and severity of climate-related disasters such as wildfires, hurricanes, flooding and drought if the world continues on its current global-warming trajectory.
"Future disasters are inevitable, yet their growing frequency and magnitude of destruction are substantially exacerbated by the decisions Americans make in where and how they build," according to the NIBS report, titled "Natural Hazard Mitigation Saves: Utilities and Transportation Infrastructure." Population sizes continue to grow in hazard-prone areas and "unless something is done to change the course of destruction, future events will affect more lives, more businesses, and the U.S. economy as a whole."
Moody's Analytics recently estimated that Hurricane Florence, which pummeled the Carolinas in September, created between $38 billion and $50 billion in economic costs related to property damage, vehicle losses and reduced economic output, among other things.
But cities and municipalities may have more mitigation options going forward. President Donald Trump in early October signed into law a bill, H.R. 302, that reauthorized the Federal Aviation Administration but also amended the Robert T. Stafford Disaster Relief and Emergency Assistance Act to allow more post-disaster rebuilding assistance to go toward migitation.
For grants that would reduce the likelihood of flooding on roads and railways, the NIBS study found that the benefit-to-cost ratios were between 2-to-1 and 11-to-1, although one project had a ratio of 0.2-to-1. Flood mitigation for water and wastewater facilities produced benefit-to-cost ratios of between 1.3-to-1 and 31-to-1. Wind and flood mitigation, respectively, for electric and telecommunications infrastructure produced benefit-to-cost ratios of 8.5-to-1 and 9.4-to-1.
For instance, the report noted that rebuilding an electricity substation in Reedsburg, Wis., about 40 feet away from and at a four-foot-higher elevation than its original location produced a benefit-to-cost ratio of $9.40 for every $1 invested. Assuming a 75-year life for the project and a cost-of-borrowing discount rate of 2.2%, that project could produce $2.2 million in benefits at a cost of $235,000. Most of those benefits, the study found, would result from avoiding the disruption to local community businesses that would occur if the substation were to go offline due to flooding.
Efforts by three West Coast electric utilities to strengthen electric substation equipment and make it more resistant to earthquake damage also were found to potentially save up to $8 for every $1 spent, depending on local seismic hazard, the study found.
"Pre-disaster mitigation — preparing in advance for future disasters — better assures that hazardous events will have short-lived and more manageable outcomes," the study said. "Mitigation saves lives, preserves homes and belongings, reduces the need for temporary shelter, helps economies to spring back faster, and lowers recovery costs. At the same time, investing in mitigation invigorates the economy through increased construction."
