Economic Assessment of Natural Resource Damages

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Natural Resource Damage Assessment Using Genetic Methods

How does Exponent help clients assess economic value on damage to natural resources?

Exponent helps clients develop a thorough understanding of the relationship between natural resource attributes and monetary damages. Natural resource damage claims are especially important because they are a potential environmental liability that extends beyond cleanup or response actions.

Damage claims sought by government trustees or tribes can be very large, and settlement or litigation costs can be correspondingly high. Exponent's multidisciplinary approach pairs specialists in ecology, toxicology, chemistry, and environmental engineering with consultants experienced in applied ecological sciences and natural resource economics to assist clients in monetizing natural resource damages.

While some damage categories are easily quantifiable, others are not. Resource damages can be classified into market-based losses (losses with available commercial values) and non-market losses (losses with values not fully captured by the market system). Cleanup and response costs and resource losses with commercial values are relatively straightforward to quantify. However, non-market losses pose a significant challenge in the economic assessment of damages. Those losses typically include decreased ecological value provided by wildlife habitat as well as diminished recreational benefits and public enjoyment of natural resources.

services

For 50+ years, we’ve thrived on solving unstructured problems that require bespoke solutions. Some of our services include:

• Calculate losses of value and subsequent restoration costs for damaged natural resources

• Provide economic support and evaluation of claims for human use losses that often include losses to recreational anglers due to chemical contamination of rivers and other water bodies

• Calculate economic losses associated with fish consumption and recreational use advisories

• Review available materials to determine the soundness of the approach used to develop a claim and identify technical errors or weaknesses that may influence estimates of recreational losses

• Provide alternative estimates for a reasonable damage claim associated with human use losses

• Evaluate a claim's appropriateness and limitations

• Examine NRD claims based on various estimation techniques such as travel cost models, random utility models (RUM), hedonic pricing, and contingent valuation (CV)

• Develop innovative and cost-effective restoration alternatives to compensate for damages to natural resources (e.g., wetland creation, hatchery construction, fish stocking, artificial reef construction)

• Scale restoration alternatives based on quantifiable injury and negotiate restoration options with state and federal trustees or tribes

• Use resource and habitat equivalency analyses (REA/HEA) to scale restoration-based damage estimates used in settlement negotiations with trustees or tribes

• Assist responsible parties in assessing the potential financial liability associated with damage to natural resources including forests and wetlands

• Address the controversy surrounding recoverable damages associated with large-scale fires on public lands

• Analyze and assist responsible parties in determining a reasonable amount for the damage claim associated with damages caused by wildfires

• Establish a dollar value range for non-market environmental damages based on empirical evidence from previous NRD cases

• Conduct a comparative analysis of pre-event through post-event environmental conditions to help determine a reasonable number of monetary damages associated with a particular injury to natural resources for which environmental losses have occurred

• Identify key factors likely to affect the responsible party's liability for damages and develop a range of estimates for environmental losses

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With expertise in over 90 disciplines and hundreds of capabilities, tools, and methodologies — we get to the root of even the most complex challenges and give you the objective answers you need.

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