Presentation - Workshop 2: The implementation of the Polluter Pays Principle, Marine Favre MCTE

1. Disproportionate costs: economic
analysis and practical application in
France
30/03/2022
CGDD 1
Marine Favre – Chargée de mission économie de l’eau
marine.favre@developpement-durable.gouv.fr

2. I. Context
Commissariat général au développement durable 2 30/03/2022
• 6 water agencies and 4 water offices
responsible for the WFD
implementation in 14 RBs:
• coordinate water policy at the river basin
level to maintain or restore water quality
• levy taxes on water uses
• grant financial support to project leaders
seeking to improve water management

3. I. Context
• 11 523 surface water bodies and 689 groundwater bodies
 2nd RBMPs : numerous justifications for time extension (WFD art 4(4))
 3rd RBMPs : numerous justifications for “less stringent environmental objectives”
(WFD art 4(5))
Commissariat général au développement durable 3 30/03/2022
Year
Surface water bodies Groundwater bodies
Ecological
good status
Chemical
good status
Quantitative
good status
Chemical
good status
2009 41% 43% 89% 59%
2015 44% 63% 90% 69%
2019 43% 45% 88% 71%
/! change in assessment
methods

4. II. A national tool for CBA
• National guidance on exemptions first published in
2009:
• assessment of actors’ affordability and the search
for alternative financing (to justify a time extension)
• monetary valuation and cost-benefit analysis
 A large number of CBA to be carried out
 Impossibility of conducting a specific study to
calculate the benefits of each site
Commissariat général au développement durable 4 30/03/2022

5. II. A national tool for CBA
• In 2009, the Ministry of Environment provided water
agencies with a spreadsheet to enable valuation
using benefits transfer
• Key data from 40 French studies that linked a change
in environmental quality with a change in level of
ecosystem service
• The tool and the published guide up-dated in 2014
http://temis.documentation.developpement-
durable.gouv.fr/document.html?id=Temis-0080405
Commissariat général au développement durable 5 30/03/2022

6. II. A national tool for CBA
Commissariat général au développement durable 6 30/03/2022
Benefits = Unit value *
basis (population or
water volume)
National ratio to calculate
population
Local data on population
concerned or water volume
Project costs
Ratio benefits / costs
If B < 0,8C = costs are
disproportionate
Type of expected benefits
• Market benefits: reduction
in water treatment costs
• Non-market benefits:
increase of users and non-
users utility through
willingness-to-pay for
recreational activities or
interest in natural heritage
Unit value of
benefit (min,
max)
Type of
environment

7. II. A national tool for CBA
• Used for economic analyses in WFD implementation: CBA with transfer
values, only very few of CBA based on on-site WTP surveys
• 2nd RBMP: 710 CBA corresponding to water bodies or groups of water bodies
• 3rd RBMP: work in progress
• Main reported difficulties:
• Choosing the relevant population to which the benefit unit value is applied
• Non-quantifiable benefits tend to be disregarded
Commissariat général au développement durable 7 30/03/2022

8. III. Ongoing works
• A large working group made up of practitioners and environmental
economists to improve the CBA tool from water agencies and offices,
consulting firms, national research centres, the national French
Biodiversity Agency and the Minister of the Environment
• General objective:
• facilitate the use of economic analysis in the implementation of the WFD
• objectify the choices for the allocation of scarce resources to reach the WFD
objectives
Commissariat général au développement durable 8 30/03/2022

9. III. Ongoing works
• Specific objectives :
• Identify studies and recent values: for existent benefits, newly
monetarized benefits
• Make the transfers more robust
• Improve ergonomics, allow more flexibility
• Facilitate the appropriation of the tool, expand the type of users
Commissariat général au développement durable 9 30/03/2022

10. III. Ongoing works
• Methodology : Building a database referencing values representing a variation in
environmental good or service linked to a change in water bodies state
1. Inventory of academic articles and expert studies
2. Review and validation by the group of each value (from many to very few values already collected)
Commissariat général au développement durable 10 30/03/2022
Watercourse Coastal Groundwater Transitional Lake
Goods produced by ecosystems (animals,
wood, etc.)
Regulation services (water quality, carbon
storage, floods, etc.)
Cultural services
Natural value
Ecologic function
Mix

11. III. Ongoing works
Commissariat général au développement durable 11 30/03/2022
Example :
• Location : In the region Basse Normandie
• Touques river is in « moderate status » (presence of unmanaged dams, agricultural activity
increasing risk of pollution of GW and soil erosion)
• The Coast is in « bad status » (green algae proliferation and discharge of waste water into the
sea close to coastal towns after summer storms)
• Change scenario: actions to restore good status by 2015
• Method: choice experiment, 880 households living in the watershed
• Value: Households living in Touques river area express a WTP of 9,4€/hh/year for restoration of the
river and of 22,8€/hh/year for the restoration of the coast
• Application: resident population (15km from the river and 80km from the Coast)
Poirier Julie, Fleuret Aurore, « Combien les résidents sont-ils disposés à payer pour des améliorations de la
qualité de l’eau ? Une application simultanée de la méthode d’expériences des choix à quatre sites récréatifs d’un
bassin hydrographique », Économie & prévision, 2015/1 (n° 206-207), p. 157-182

12. III. Ongoing works
• Methodology : Proposing a toolkit to facilitate the application of methodological transfer
rules
1. On each study, recording of accompanying key elements on:
• initial context (physical environment of waterbody)
• change scenario
• description of the supply of the good or service to be valued and its variation with the change
scenario
• identification and description of the initial population
2. Current discussion on transfer rules: do we keep simple transfer or set-up adjusted transfer
(based on revenue) ?
Commissariat général au développement durable 12 30/03/2022

13. Commissariat général au développement durable 13
2021-2022
Database (values, transfer
toolkit)
2023
Publication, transfer, training
2024-2025
Use for 4th RBMPs
30/03/2022
III. Conclusion
• The new version of the tool will be available in 2024
• We are interested to know and to learn from the practices of other Member States

14. Thank you
30/03/2022
CGDD 14
Marine Favre – Chargée de mission économie de l’eau
marine.favre@developpement-durable.gouv.fr