trade-off analysis roles of economists and new analytical requirements
TRANSCRIPT
Planning in a Collaborative Environment
Enhance collaborative approach to water resources management
– Watershed/system vs. site specific– Multiple purposes / multiple partnerships
Fully utilize flexibility and authority of P&G– Evaluate, display and compare the full range of alternative
plans effects across all 4 P&G accounts.– May select any candidate plan with net beneficial effects
(based on 4 accounts) with ASA exemption.– Must identify NED Plan.
In formulating Collaborative Plans, we face inherent conflicts:
Multiple collaborators with varied interests Need to determine “net beneficial effects”
considering multiple variables for which performance is measured using different metrics (quantity and quality) and which have different degrees of importance for the collaborators/stakeholders/public.
Trade-off analysis required to identify optimum solution.
Combined Plans
Modern day multipurpose planning - strive to achieve environmental sustainability (EOPs)
– “Seek balance and synergy among human development activities and natural systems by designing economic and environmental solutions that support and reinforce one another.”, Environmental Operating Principles, March 2002
Contribute to environmental sustainability as defined in EOP’s by formulating Combined NED/NER plans
Combined NED/NER Plan = Combined Plan
In formulating Combined Plans, we face an inherent conflict:
Most “commercial” (NED) water resource development derives benefit by reducing hydrologic variability
Most ecosystem restoration (NER) derives benefit by restoring hydrologic variability
Trade-off analyses required to identify optimum solution
Trade-off Analysis
Fundamentally a political process It is not science Rarely, if ever, objective
However, it can be approached in a structured and systematic way to improve reliability and validity of the process
Trade-off analysis
The purpose of multicriteria trade-off methods is to improve the quality of decisions by making the decision making process more explicit, rational, and efficient.
Example: Buying a car.
Choosing a car: Organizing the decision
S a fe ty E ff ic ie n cy
P E R F O R M A N C E S T Y L E
In it ia l C o s ts M a in te na n ce
C O S T S
B U Y A C A R
Choosing a car: Choice will differ based on perspective
Buying for your self Buying for your family Someone buying for you as a gift Buying for a rental car firm Buying for GSA
Analogous to different perspectives of various partners in Corps trade-off situations
We make trade-offs in many situations in the Corps
PLANNING– Navigation– Flood damage reduction– Ecosystem restoration– Watershed studies– Project EIS
OPERATIONS– Reservoir reallocation– Major rehabilitation– Changes to operating
plans– Regulatory permit
decisions / EIS
Trade-offs require consideration of:
Variables or “indicators” important to the decision
Yardsticks to measure performance against the indicators – quantity AND quality
Relative importance across indicators (preferences, weights)
Combined Plans Evaluation:Example Procedure
Trade-off Analysis:– Identify criteria (variables or indicators)
Total Annual NED Benefits Total Annual Ecosystem Restoration Outputs Total Annual Cost
– Yardsticks NED Benefits - $$$ Ecosystem Restoration Outputs – Hus, acres of wetlands, etc. Cost - $$$
Combined Plans Evaluation (Continued)
– Identify Not-dominated (cost effective plans)
Use multiple criteria:
– Total Annual NED Benefits– Total Annual Ecosystem Restoration Outputs– Total Annual Cost
Not Dominated Plans(Cost Effective)
Plans and Components
TAC
($000)
AAO ER
(HU’s)
AAB FDR
($000) 66. WU30+44+SR+REF10+31+WIF30+35 +R25
1187
497
1600
22. L6+WU30 1006 40 1500 25. SR+SL3 1128 170 900 21. WU30+44+SR+REF10+31+WIF20+35+R10
613
490
700
68. REF10+WIF20+SL4 1280 50 1700 118. SR+R1 1947 170 2100
Does choice of multicriteria trade-off method matter?
Which multicriteria method is adopted can make a significant difference in the decision, in that choice of a method can affect the results as much or more than which person applies the method.
Popular Trade-off Analysis Methods
Weighting Methods– Non-Normalized– Normalized
Effects Matrix Ranking Index
– Commensurable Metric, Ordinal Data, Direct Weights– Ordinal Ranking– Borda’s Simple Method– Unequal Weights– Outranking Methods
Analytical Hierarchy Process
Popular Trade-off Analysis Methods
For more information, go to:
Trade Off Analysis Planning and Procedures Guidebook, IWR Pub 02-R-2, April 2002
Output of Trade-Off Analysis
Ranking of Plans, best to worst, that meets the outcome defined for each criterion considering the preferences (ako, weights) assigned to each criterion by PDT.
Is the highest ranking plan the one to recommend? Maybe.
Combined Plans: Comparison and Selection
Comparison
– Compare highest ranked justified plan to NED or NER Plan.
Consider benefits foregone, benefits gained, differences in cost and other decision criteria.
Document rationale for selecting Combined Plan over NED or NER Plan.
Where are we on development of final Guidance?
Developing multipurpose formulation and evaluation manual to include:
– Fully worked example to illustrate various trade-off approaches (index, distance functions, ect.).
– Revisiting decisions on criteria, justification, incremental analysis
IWR-PLAN updated for trade-off analysis. New OSE/RED Handbooks