- 20th October 2017
- Posted by: Joanne Woodhouse
- Category: Projects
A natural capital approach and valuation is gaining more and more attention and interest from the government, regulators, and companies. It allows them to more accurately represent the benefits and draw backs of investment decisions in relation to asset or whole catchment management solutions. DEFRA and environmental regulators are increasingly looking at utilising natural capital approaches and valuation. For this, they are asking different sectors to become key contributors.
United Utilities is a key player in the UK water sector and are looking to pilot natural capital approaches in anticipation of more catchment based approaches in AMP7. This would include developing an options appraisal process, at a catchment level from a Water Framework Directive perspective, to determine multiple benefits for the maximum number of stakeholders.
In partnership with Vivid Economics, we created a natural capital decision support model for the Petteril catchment in Cumbria. This was to test and target solutions to achieve the best value outcomes for the catchment and United Utilities’ customers. A methodology was created to integrate flood risk and water quality modelling, that could be inputted into a natural capital economic model, to appraise a range of natural flood management measures, risks and benefits across the catchment. Fundamentally, such an appraisal requires integrated modelling of these different catchment risks. Expertise across different disciplines from flood and diffuse pollution modelling, to carbon and economic accounting were needed.
The methodology utilised existing water quality modelling tools. FARMSCOPER was used to define the percentage change in diffuse load reductions for Nitrate and Phosphate. Subsequent reduction of diffuse load inputs were done in SIMCAT to compute the percentage change in water quality loads at key monitoring sites. JFlow®, our 2D hydrodynamic modelling software, was also used to investigate the benefits of natural flood management interventions on flood risk.
The trial of this methodology for the Petteril catchment was largely informed by stakeholder consultation within the Petteril. The consultation was essential to gain local knowledge and information on the Petteril and the types of interventions that can be implemented.
The outputs of this environmental modelling informed the natural capital approach and valuation to determine the net present value. The natural capital approach and valuation results have been presented in an integrated interface created for United Utilities called the CatMan (Catchment Management) tool. This CatMan tool will support United Utilities and its stakeholders in determining optimised solutions. It provides benefits beyond its fair share, achieving more for less. It can be populated using outputs from different modelling packages. Plus, provides an interface for decision makers that takes on multiple benefits.