Economic Evaluation for Flood Control Investment in Japan

Ministry of Land, Infrastructure, Transport and Tourism
Economic Evaluation for Flood Control
Investment in Japan
September 18, 2019
Kazushi FURUMOTO
Director for International Coordination of River Engineering
River Planning Division, Water and Disaster Management Bureau
Ministry of Land, Infrastructure, Transport and Tourism (MLIT), Japan

Outline
1
1. Principles on Investment and Financing for
Water-related Disaster Risk Reduction
2. Economic evaluation for flood control project
and recent effort in Japan
3. Issues and way forward

1. Principles on Investment and Financing
for
Water-related Disaster Risk Reduction
※Launched at 4th UN Special Session
on Water and Disasters in NY (Jun. 24, 2019)
2
http://www.wateranddisaster.org/cms310261/wp-content/uploads/2019/07/HELP-Principles-
Full-Final-Printing.pdf

Objectives: Assist the international community, governments and
stakeholders in mobilizing political will and resources, and take
effective measures to address the issues of water and disasters.
Chair: Dr. Han, Seung-soo (Special Envoy of the UN Secretary-
General for Disaster Risk Reduction and Water, Former Prime
Minister of the Republic of Korea)
Members: Indonesia, Japan, Myanmar,
Netherlands, South Korea, US, ADB, AMCOW,
GWP, JICA, MunichRe, NARBO, OECD,
UNESCO, UNISDR, WB, WMO, WWC, Others
http://www.wateranddisaster.org/
3
High-level Experts and Leaders Panel
on Water and Disasters (HELP)

4
Goal of the Principles
• Double globally the investment and financing for
water-related disaster risk reduction by 2025.
• Shift international assistance from disaster
response to preparedness.
Current Goal
Emergency Response/
Rehabilitation 90% 50% 10%
Disaster Risk Reduction/
Preparedness 10% 50% 90%

5
Key Messages of the Principles
1. Water-related disaster risk reduction is indispensable
for sustainable development.
2. Pre-disaster prevention measures should be
prioritized and incentivized.
3. Governments should improve their systems and
allocate sufficient budget.
4. More funding sources than public funds should be
mobilized.
5. International community should expand financing.
6. Science, technology and knowledge systems should
support sound investment decisions.

Storm Surge Disasters in Osaka
6
Storm Surge Hazard Map (1/750 Level)
Kansai Airport
• Osaka Bay area was repeatedly hit by storm surge disasters.
• Land subsidence caused a wide area below sea level.
• 130,000 houses was inundated due to the Typhoon in 1961
Water Depth
(m)
0 20 km
0
- 0.5
- 1.0
- 1.5
- 2.0
- 2.5
- 3.0
Cumulative Land Subsidence (m)
1935 1955 1975 1995
Year
Inland
River
mouth
Inundated Runway(Typhoon, 2018)

Storm Surge Prevention and Effects
7
・Invested JPY300 billion ( US$ 3 billion) for storm surge prevention projects(1965～)
・Although storm surge was 36 cm higher, Osaka delta was protected from inundation
・Prevented damage is estimated to be JPY 17 trillion (=US$ 150 billion).
Embankment Gate Closure
Area under Sea Level
Embankment Gate
Storm Surge Barrier
Sea Level
21 cm above
the ground
Pumping Station
River Barrier

2. Economic evaluation
for Flood control project,
and
Recent effort in Japan
8

Economic Evaluation for Flood Control Investment
9
Manual Outline
1. General review
2. Analyzing the characteristics of flood plain
3. Flood simulation
4. Cost-benefit analysis
• Direct damages
- Residential buildings
- Residential properties
- Business establishments (Depreciable assets, Inventories)
- Agriculture and fishery households (Depreciable assets, Inventories)
- Agricultural products
- Large-scale public facilities
• Indirect damage
- Business interruption
- Emergency response costs (Households)
- Emergency response costs (Businesses)
• Calculation of benefits (Expected annual average damage reduction)
• Other benefits
5. Calculation of costs
6. Evaluation of economic efficiency
Manual for
Economic Evaluation of
Flood Control Investment
(Draft)
April 2005
River Bureau
Ministry of Land, Infrastructure,
Transport and Tourism
The Manual for Economic Evaluation of Flood Control Investment (MLIT, 2005)

Non-Monetary Indicator Analysis
- MLIT has published the “Guidance for Non-Monetary Indicator Analysis of
Damage from Flood Disasters (2013 Trial Version).”
- The guidance illustrates calculation methods that base on certain assumptions to
allow for limits of data availability and limits of spendable human efforts.
Table of Contents
① Damage to people
② Damage from the functional decline of medical and
social welfare facilities
③ Damage from the functional decline of disaster-
prevention facilities
④ Ripple effects of the disruption of traffic
⑤ Ripple effects of the disconnection of lifelines
⑥ Ripple effects of damage to economy inside and
outside the disaster area
⑦ Damage to underground space
⑧ Damage to cultural facilities
10

Simulation of Inundation
River improvement plan
Estimation of benefits
Estimation of total benefits
Benefit-cost ratio
Annual costs = construction costs and
maintenance costs incurred during the year
Estimation of annual costs
of the river improvement
Total costs = sum of annual costs incurred
during the project years
Estimation of total costs
of the river improvement
Non-Monetary Indicator Analysis for the
“with-the improvement” condition and
“without-the improvement” condition
Estimation of damage
Can benefits be estimated in
monetary terms?
To solve difficulties in estimating benefits from
flood control investments in monetary terms
Benefit-Cost
Analysis
Non-Monetary Indicator Analysis
(for quantifying ripple effects of the disconnection of lifelines, etc.)
• Selection of non-monetary
indicators of damage
• Estimation of annual average
reduction of damage
• Selection of the scale of flooding
• Division of the inundation area
into subsets
No
Yes
Calculating numbers for non-
Monetary indicators of damage
11
Implementation of the Non-Monetary Analysis

Intensification Benefit
10. Increase in land prices as a result of improvement in flood protection
Indirect Damage
3. Business interruption
• Business interruption damage (household, businesses, public and public interest services)
• Emergency response costs (household, businesses, public and public interest service)
4. Impairment of social welfare facilities (hospitals, social welfare facilities, disaster
management facilities)
5. Economic impact (disruption of traffic, lifeline, cascading economic impact of damages)
6. Other damage (underground space, cultural facilities, waste generated by flood)
7. Psychological damage
8. Risk premium (insecurities due to possibility of damage)
9. Damages that cause permanent changes to the local economic system
Direct Damage
1. Damage to asset
• General property damage (houses, residential properties depreciable assets and
inventory assets of businesses, depreciable assets of fishing and farming properties, etc.)
• Agricultural product damage
• Infrastructure damage
2. Human damage (human loss, people isolated etc.)
12
Items for Project Evaluation
Cost-benefit analysis and Quantitative assessment for flood control project

Quantitative Indicators for Non-Monetary Analysis
Indicatorsaresetfor
theitems#1to#4.
1. Indicators of damage to people
• Population in the inundation area
• Number of people that will require assistance at the time of disaster
• Estimated number of deaths
• Maximum number of people likely to be left in isolation
• Number of people likely to be left in isolation for more than three days
• Estimated frequency of evacuation per decade
• Estimated total number of evacuees per decade, etc.
2. Indicators of the functional decline
of society
• Estimated number of medical facilities affected by the disaster
• Estimated number of patients in medical facilities affected by the disaster
• Estimated number of dialysis patients in medical facilities affected by the disaster
• Estimated number of social welfare facilities affected by the disaster
• Estimated number of users of social welfare facilities affected by the disaster
• Estimated number of key disaster-prevention facilities affected by the disaster
• Population in the district whose disaster-prevention facility is to be affected by the
disaster, etc.3. Indicators of ripple effects of
damage
• Main roads to be disconnected
• Amount of traffic to be affected by the disconnection of roads
• Traveling time and expenses to be increased by the disconnection of roads
• Major railways to be disconnected
• Number of passengers to be affected by the disconnection of railways
• Population to be affected by the suspension of electricity, gas, water, and sewage
• Population to be affected by the suspension of landline and mobile phones
• Ripple effects of damage to economy estimated by economic models including
input-output analysis
• Likely impact of disaster-stricken companies on supply chains
• Number of listed companies to be inundated
• Number of employees of companies to be inundated, etc.4. Other indicators of damage
• Subway lines and stations to be inundated
• Number of passengers to be affected by the inundation of subways
• Underground malls/facilities to be inundated
• Number of users to be affected by the inundation of underground malls/facilities
• Cultural facilities to be inundated
• Amount of waste likely to be generated by flooding and inundation
• Estimated costs for treating flood waste, etc.
Estimation of damage
Direct damage
Damage to property
Damage to general assets Buildings for households and businesses
Household furnishings
Depreciable assets of businesses
Inventory assets of businesses
Depreciable assets of farmers and fishers
Inventory assets of farmers and fishers
Damage to agricultural produce
Damage to public works
1. Damage to people
Damage to people
Population in the inundation area, number of people requiring
assistance at the time of disaster, number of deaths, number
of people left in isolation, number of evacuees, etc.
Indirect damage
Damage to daily operations
Damage from the discontinuation of
daily operations
Households
Businesses
Public services
Costs for emergency response
Households
Businesses
National and local governments
2. Damage from the functional decline of society
Damage from the functional decline
of medical and social welfare
facilities
Medical and social welfare facilities
Damage from the functional decline
of disaster-prevention facilities
Disaster-prevention facilities of local government, police, and
fire department
3. Ripple effects of damage
Ripple effects of the disruption of
traffic
Roads, railways, airports, ports, etc.
Ripple effects of the disconnection
of lifelines
Power supply, water supply, gas supply, communication
services, etc.
Ripple effects of damage to
economy inside and outside of the
disaster area
Businesses
Mental damage
4. Others
Damage to underground space
Damage to cultural facilities
Waste generation from flooding and inundation
Risk premium
Ripple effects of changes in the socioeconomic structure of the disaster area
Estimated benefits from the sophistication of flood risk management
Items that have already been used for B/C analysis
Items that were added or modified recently
Items that have not yet been included in any analysis
13

The “maximum number of
people likely to be left in
isolation” will take account of
development of inundation
and passage of time.
Without dam… With the dam…
Legend
◎ Koshigaya City Hall
● Police station
● Fire department
Medical institution
● Large shopping center
Legend
(depth of inundation)
■ 30 cm or more
N N
14
• Decrease of the number of people to be left in isolation and the population to be
affected by the suspension of electricity supply by Yamba Dam Construction Project
Example of the Non-Monetary Indicator Analysis
• The areas surrounded by the red dashed line,
which correspond to urban areas shown in the
satellite phots, are the areas where the dam is
expected to bring its benefits.
1. Maximum Number of
people to be left in isolation
Indicator Damage
Area to be
inundated 110,000 ha
Maximum number
of people likely to
be left in isolation
(evacuation rate
40 %)
720,000
people
Indicator Damage
Area to be
Maximum number
of people likely to
be left in isolation
(evacuation rate
40 %)）
800,000
people

The “depth of inundation likely to
cause the suspension of electricity
supply” will be associated with the
number of residents in the area in
blackout due to inundation.
Depth of inundation
■ 70 cm ~ 100 cm
■ 100 cm～ 340 cm
■ 340 cm or more「
Indicator Damage
Area to be
Population to be
affected by the
suspension of
electricity supply
2.06 million
people
Indicator Damage
Area to be
Population to be
affected by the
suspension of
electricity supply
1.9 million
people
Without the dam… With the dam…
Legend
◎ Katsushika City Hall
● Police station
● Fire department
Medical institution
● Large shopping center
2. The suspension of
electricity supply
15

The “maximum number of people likely to be left in isolation along
the Tone River” would decrease from 800,000 to 720,000 on
average, and the “population to be affected by the suspension of
electricity supply” would decrease from 2.06 million people to 1.9
million people on average.
Evaluation of
effects of the
project assessed
by the non-
monetary
indicator analysis
Project re-evaluation report
(December 2013)
16
In line with the guidance, the evaluation of effects of the project assessed by the
non-monetary indicator analysis appears in the project re-evaluation report.
Example of Project Re-Evaluation Report
http://www.mlit.go.jp/river/basic_info/seisaku_hyouka/gaiyou/hyouka/h2512/index.html

 For project evaluation:
Ways for a full-scale implementation of the analysis are
being explored.
 For risk evaluation:
Ways to include the analysis in the development of risk
management measures such as the following are being
explored.
• Development of management structures for emergency
evacuation
• Development of frameworks for emergency actions
17
Major Purposes of the Non-Monetary Indicator Analysis

- How to upgrade traditional cost-benefit analysis?
e.g. Discount rate
- How to assess the non-economic value of intangible?
e.g. Multi-evaluation method
- How to assess the non-structural project?
e.g. Tax system, flood insurance, land-use regulation
- How to assess the future changes in the environment?
e.g. Influence of Climate Change
etc. 19

20
Categories of Flood Impact for Project Analysis
• The survey on direct and indirect damages considered in cost-benefit analysis
• Further updated and detailed research is necessary.

・Annual occurrence of 1-hr rainfall
・Summary from nationwide 1,300
points of AMEDAS
Comparing the latest decade (2006-2015) and 30-yrs ago (1976-1985),
heavy rains of 50mm/hr and 100mm/hr increased 1.3 times and 1.6 times
respectively.
Characteristics of Rainfall in the Recent Years
Occurrence of
heavy rain of
50mm/hr or more
21
Occurrence of
heavy rain of
100mm/hr or more
Ave.174 times
Ave.230 times
Approx.1.3 times
Ave. 1.9 times
Approx.1.6 times
Ave. 3.1 times

Thank you so much for your kind attention!

• 死者数の推計に当たっては、米国陸軍工兵隊がハリケーン・カトリーナでの人命損失検証のため
に採用したLifeSimモデルを用いた。
床高床高
階高
階高
階高
図 LifeSimモデルの概要図
65歳以上の場合
0.023
12.00
91.75
死亡率（％）
安全水位帯
準危険水位帯
危険水位帯
最上階の床面か
らの浸水深（ｍ）
浸水深による
危険度の分類
65歳以上の場合
0.023
12.00
91.75
死亡率（％）
安全水位帯
準危険水位帯
危険水位帯
最上階の床面か
らの浸水深（ｍ）
浸水深による
危険度の分類
23
指標例：人的被害（死者数）

各家庭における飲料水や食料等の備蓄が尽きると想定される日数である3日間以上孤立する人数を
指標とする。
３日以上孤立者数
＝{Ｐ１×（1－(避難率)）＋Ｐ２×(1－(避難率)) ｝
Ｐ１：３日以上継続する浸水区域内人口（65歳以上）、Ｐ２：３日以上継続する浸水区域内人口（65歳未満）
浸水範囲被災内容
50cm浸水その他の避難が困難となる水位
30cm浸水災害時要援護者の避難が困難となる水位
24
図：浸水中の避難可能性（避難可能浸水深）
出典：亀井勇；「台風に対して」,「天災人災住まいの文化誌」,ミサワホーム総合研究所,1984
子供
大人
浸水深と移動、避難の関係
【伊勢湾台風の実例】
【他の実例】
・東海豪雨水害時に、ゴム
ボートなどで救助されて避難
した時の浸水深は膝の高さ
以上であった。
・関川水害(平成7 年)におけ
る調査結果によれば、浸水
深が膝(0.5m)の高さ以上に
なると、ほとんどの人が避難
困難であった
指標例：人的被害（3日以上孤立者数）

25
【利用者側施設】
 戸建て住宅
・1階コンセント（図-1）部の浸水・・・家屋全体が停電
⇒機能停止する浸水深＝70cm（50cm（床高）＋20cm（床～コンセント））
 集合住宅
・1階コンセント部の浸水・・・浸水したフロア全体が停電
⇒機能停止する浸水深＝70cm（戸建て住宅と同様）
・受変電設備（図-2）の浸水・・・棟全体が停電
⇒機能停止する浸水深＝100cm
【供給側施設】
 路上開閉器（図-3）
・路上開閉器の浸水・・・浸水区域程度が停電
⇒機能停止する浸水深＝100cm
10cm
20cm
図-1 コンセント位置図図-2 受変電設備図-3 路上開閉器
指標例：ライフライン被害（電力）

浸水面積 0ha
想定死者数避難率0% 0人
避難率40% 0人
避難率80% 0人
基本方針の対象規模の洪水における浸水範囲
浸水面積約3,600ha
想定死者数避難率0% 約230人
避難率40% 約140人
（整備後）
（整備後）（整備前）
（整備前）
1m未満
1～2m
2～3m
3～4m
4m以上
浸水深の差分
1m未満
1～2m
2～3m
3～4m
4m以上
浸水深の差分
（整備前－整備後）
（整備前）－（整備後）
500～770cm未満(2階65歳以上、平屋65歳未満)
770cm以上(2階65歳未満)
浸水深
230cm未満
230～500cm未満(平屋65歳以上閾値)
230cm未満
230cm～500cm（1階危険水位）
770cm以上
浸水深
230cm未満
230cm未満
770cm以上
浸水深
230cm未満
230cm未満
770cm以上
浸水深
230cm未満
230cm未満
770cm以上
整備計画の対象規模の洪水における浸水範囲
定量化指標分析のイメージ①
26

整備計画の対象規模の洪水における浸水範囲
基本方針の対象規模の洪水における浸水範囲
電力の停止による影響人口約16,800人
浸水面積 0ha
電力の停止による影響人口 0人
浸水面積約4,500 ha
（整備後）
（整備後）（整備前）
（整備前）
電力の停止による影響人口差約12,300人
1m未満
1～2m
2～3m
3～4m
4m以上
浸水深の差分
1m未満
1～2m
2～3m
3～4m
4m以上
浸水深の差分
100～340cm未満
340～500cm未満
500cm以上
浸水深
70cm未満
70～100cm未満
100～340cm未満
340～500cm未満
500cm以上
浸水深
70cm未満
70～100cm未満
100～340cm未満
340～500cm未満
500cm以上
浸水深
70cm未満
70～100cm未満
100～340cm未満
340～500cm未満
500cm以上
浸水深
70cm未満
70～100cm未満
定量化指標分析のイメージ②
27

これまで今後
洪水防御に関する計画
の基本となる降雨のみ
を対象
想定最大外力までの様々な規模の降雨を対象
※図は、あくまでイメージのため、実際の河川と必ずしも一致しない。
○避難の検討やまちづくり、投資判断等に資するよう、様々な規模の降雨について浸水想定
を作成・提示
年超過確率1/150
年超過確率1/10
年超過確率1/50
年超過確率1/150
想定最大外力
様々な規模を想定した浸水想定
18

対象に応じた災害リスク情報の提示
リスクマップ利用者活用用途リスクマップ（例）
住民避難判断や住宅等の購入・床上浸水や健常者の避難が困難となる浸水深50cmの頻度マップ
危機管理部局避難計画への活用・浸水深図に病院等の重要施設や避難所・避難経路を重ねたマップ
・時系列浸水深図（排水完了時間）や浸水継続時間図
まちづくり部局土地利用計画への活用・浸水深図に都市計画図を重ねたマップ
企業施設の立地やBCPの作成・企業の経営への影響が小さい浸水深○cmの頻度マップ
・時系列浸水深図（排水完了時間）や浸水継続時間図
○対象に応じた災害リスク情報の提示により、避難やまちづくり等への活用を図る
※最大クラスの外力（想定最大外力）を含め、複数の外力規模を対象とする
床上浸水
発生確率
床上浸水の発生頻度
住宅等の購入の判断に活用
浸水想定（年超過確率1/10）
都市計画図（用途地域）
浸水想定と都市計画図の重ね合わせ
土地利用計画に活用
住民に提示する情報まちづくり部局に提示する情報
19

現行の治水経済調査の課題
30
• 経済被害の波及被害
– 浸水区域外への影響
• 防災事業におけるリスクプレミアムの考慮
– 災害可能性に対する不安
• 流動性制約と災害復旧過程の考慮
– 災害後に瞬時に災害前の状態に戻る？
• その他
– 堤防の安全性評価等（質的強化の経済評価）

Economic Evaluation for Flood Control Investment in Japan

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