Low Impact Development Capital Costs - City of Philadelphia 2018 Annual Report Compiles Green Infrastructure Costs and Service Area

See September 2019 Update and Comparison at Bottom of this Post.

Green Infrastructure (GI), Low Impact Development (LID) Stormwater Best Management Practice (BMP) measures are widely promoted to achieve water management goals including baseflow management (i.e, through groundwater infiltration / recharge) and erosion stress reduction (i.e., through runoff volume reduction for small storms).

The capital cost of GI / LID / BMPs is of considerable interest to those considering implementation on a system-wide basis. In general, the capital cost can be related to the size of the measure, often dictated by the size drainage area it serves.

The City of Philadelphia has been implementing GI / LID / BMP retrofits for many years and has compiled the cost of measures. These have been recently reported in this document (see pdf page 151). This is an excerpt:

Data in the table has been compiled to support cost benefit analysis for flood resiliency assessments. The chart below shows how costs increase as a function of drainage area size.

The slope of the cost vs. drainage area trend line is $295,000 per acre, or $728,000 per hectare considering 85 projects, some with multiple sub-projects.

The 2018 report includes projects completed between 2006 and 2018. When capital costs are adjusted for changes in construction costs, costs can be expressed in 2018 dollars. An adjustment in Philadelphia project costs was based on data from RSMeans (link). The following chart shows green infrastructure capital costs in 2018 dollars vs. drainage area.

 The average cost per acre is $320,000 while the cost per hectare is $792,000. There is a very strong correlation of cost with drainage area serviced by the green infrastructure feature. Weighted by the overall program cost of $56.8M and total drainage area of 164 acres (66 hectares), the program costs per acre and hectare $347,000 and $857,000 respectively. In a previous post the budgeting considered by Philadelphia was $350,000 per impervious acre, or $865,000 per impervious hectare. These costs suggest a lower cost per impervious area than those budget amounts.

The cost of providing storage is indicated in the chart below. Again the overall project or bundled project cost is highly correlated to the storage volume provided by the green infrastructure measures. The average cost is $52.7 per cubic foot or $1850 per cubic metre of storage. Note that the weighted overall program cost is different - the $56.8M cost for 907,000 cubic feet, or 25,700 cubic metres, of storage works out to unit costs of $62.6/cu.ft, or $2200/cu.m

It is worthwhile noting the average storage depth across the drainage areas serviced by the green infrastructure features. The average depth is 25,700 cu.m / 66 hectares = 25,700 / 660,000 = 39 mm. This reflects the range in design of 1 to 2 inches (25-50 mm) intended for CSO control. It is above the depth that is typically used for achieving watershed or catchment water management goals, e.g., water balance management for erosion mitigation, groundwater recharge, or non-point source water quality management. The draft Ministry of Environment, Conservation and Parks Low Impact Development guidance manual proposed control volumes up to 32 mm in Ontario, or 18% below the average depth in the Philadelphia projects.

Unit costs can be used to support high level green infrastructure program and project budgeting. There is scatter within the charts for a given drainage area or storage volume, meaning the cost of an individual project should allow for a high contingency above the average unit costs, until design details are available.

Unit costs can be assessed for various LID types - cost per drainage area for permeable pavement, rain garden, infiltration trench and tree trench projects are shown in the chart below with infiltration trenches having the lowest cost per acre and permeable pavement having the highest. The unit costs of rain gardens and tree trenches are above those of infiltration trenches.

Cost per storage volume for permeable pavement, rain garden, infiltration trench and tree trench projects are shown in the chart below. Again, infiltration trenches having the lowest cost per cubic foot of storage and permeable pavement having the highest cost per storage unit. The unit costs of rain gardens and tree trenches are above those of infiltration trenches.

The inset text boxes on the charts illustrate unit costs (i.e., the slopes of the trend lines):

Unit Cost per Drainage Area Summary:
Infiltration Trench: $260k/acre ($642k/hectare)
Pervious Pavement: $594k/acre ($1.47M/hectare)
Rain Garden: $408k/acre ($1.01M/hectare)
Tree Trench: $318k/acre ($790k/hectare)

Unit Cost per Storage Volume Summary:
Infiltration Trench: $49.0/cf ($1730/cu.m)
Pervious Pavement: $97.2/cf ($3430/cu.m)
Rain Garden: $60.1/cf ($2120/cu.m)
Tree Trench: $58.9/cf ($2080/cu.m)

***

Green Infrastructure Strategies?

In Ontario, there are approximately 852,000 urban hectares that have no green infrastructure controls  in the year 2000 (per SOLRIS GIS land use data). Implementing green infrastructure across all these areas, similar to Philadelphia, would cost 853,000 x $857,000 = $730 billion - this is 100 times greater than the entire Ontario stormwater infrastructure deficit, and a similar magnitude to Ontario's annual GDP ($854B in 2018). Philadelphia is targeting a specific need for CSO control to justify its green infrastructure investment. Given this magnitude of cost, to make green infrastructure affordable in Ontario certainly requires a strategic assessment on where it is implemented. The expected annual flood damage loss in Ontario is $292M, meaning that if flood control green infrastructure reduces the cost by half each year for 50 years (assumed service life), the total savings is $7.3B - why would one invest 100 times that loss ($730B) in green infrastructure?

Ontario's Draft LID (Low Impact Development) Manual sets a generic goal of implementing LID / green infrastructure in new development and retrofit development (including linear infrastructure). Cost concerns with a generic approach have been identified by the Ontario Society of Professional Engineers in comments on Bill 139 assuming unit cost of $400,000 per hectare based on a small set of Ontario tender costs. Those costs were for small volume installations, whereas the Philadelphia program costs are for high volume installations.

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Update September 2019

The following is a comparison of costs from three sources:
i) Philadelphia (costs above),
ii) Ontario and Alberta project review (expanding previous list), and NEW
iii) EPA International BMP Database costs review.

Green Infrastructure Costs - Philadelphia, Ontario, Alberta and US EPA BMP Database Projects

Costs are normalized by drainage area and grouped by type of LID BMP.  An important design parameter is shown in the second last row - i.e., storage volume - that helps explain the variability in some program costs.  For example, Philadelphia storage volumes average 38.9 mm across the catchment being served while the EPA database projects average 6.6 mm - Philadelphia is pursuing CSO control with target storage volumes of 1-2 inches.  Other EPA BMP Database projects incorporate much smaller storage volumes on average.  Note that Philadelphia has a high cost per hectare but this is due to a higher design volume - their cost/hectare is 4.1 times the EPA project cost, but the design volume is 5.9 times greater.  This shows a higher cost efficiency in Philadelphia for the larger projects.  This is seen in the cost per ha-mm or cost per cubic metre of storage (only $22,000 / ha-mm for Philadelphia vs. $32,000 per ha-mm for EPA projects).

Some more notes:
- the Ontario costs in bold are for entire projects what may include several components, which is why the individual LID type costs are lower
- Ontario data omits storage for most projects, which is a gap that should be filled in the future
- the costs per storage volume in EPA for permeable pavement and infiltration trenches seem low, based on large storage projects that suggest costs of $400-500 / cu.m for large centralized facilities

How can the unit costs for LIDs be applied, say in planning level studies?  Well ...

In Ontario, 5 mm is a general criterion for erosion control (Toronto and Region Conservation Authority watershed) and is the control volume for Toronto's Wet Weather Flow Management Program.  The compiled costs can be used to show that providing this 5 mm of storage would cost $160,000 per  hectare ($32,000/ha-mm x 5 mm).

In a typical storm sewer catchment with a 50 hectare drainage area the capital cost would be $8M to implement 5 mm LID storage across the catchment/drainage area.

Across Ontario, with 852,000 hectares of urban development built before 2000, the cost to implement 5 mm of LID storage would be $136B, or about 20 times Ontario's current stormwater infrastructure deficit.

Green Infrastructure Implementation Funding - Private Sector Costs Proposed as Offsets Paid by Benefiting Municipalities

How to fund green infrastructure and low impact
development stormwater management measures on
private property .... no easy answers. 

The report Economic Instruments to Facilitate Stormwater Management on Private Property is an interesting read, looking at how green infrastructure (GI) could be implemented and funded on private property to advance stormwater management goals. There is a link to the report.

The White Paper / study report explores the costs and benefits of green infrastructure, or low impact development (LID) measures, and looks at the barriers to implementation on private property - and there are many. These Barriers to the Implementation of LID Technologies include:

1. High up-front costs
2. Uncertain ongoing maintenance requriements
3. Low return on investment
4. Limited benefits accrue directly to property owners, yet they incur the high costs
5. High transaction costs

The report illustrates the types of costs and benefits under #4 in the following graphic:

Imbalance in public and private costs and benefits for green infrastructure / low impact development implementation.

The graphic illustrates that private costs are high, but the majority potential benefits are public.  Also, the private benefits are very low, like the potential reduction in stormwater management fees available to compensate for the GI or LID measures.

How high are the costs for implementing GI or LIDsfor improved stormwater management? Another interesting graphic shows annualized costs considering capital costs distributed over a 25 year service life (e.g., like annual depreciation of the asset) and annual operation and maintenance (O&M) cost.

LID capital and operation and maintenance costs greatly exceed the potential annual credit for stormwater fees. 

The report's impervious percentage of 20% seems too low
compared to typical urban development patterns in Ontario.
Typical residential percentages are double the report's
assumed value. Typical non-residential percentages can
even be higher (i.e., lots covered almost entirely by impermeable
roof top and parking lot surfaces.

The annual cost of LID measures averages about $5,000 per year considering a 'lot size' drainage area of 5000 square metres, or $10,000 per hectare. The cost estimates consider an area with 1000 square metres of impermeable area, meaning an impervious area percentage of 20% (i.e., very, very low for many urban areas ... meaning these average costs should be higher - see example impervious area coverage at right - while this is residential development, non-residential development has followed similar trends).

Given the disparity in costs and benefits, an obvious barrier to implementation of GI and LID on private property, what is proposed to incentivize implementation? Make someone else pay of course! Who pays? The Public Sector. They call this "OFFSETS" and explain it as follows:

"Offsets are payments offered to proponents of LID infrastructure in compensation
for costs incurred when significant benefits accrue to other parties. A principle of
equity or fairness underlies this type of compensation based on the argument that
costs should be borne proportionately by those who benefit from the green
investment.

Public sector contributions in the form of offsets are justified to achieve a balanced
approach to cost sharing that reflects how all costs and benefits are incurred. Doing
this requires identification and quantification of benefits.."

So ultimately, the idea is that the public pays regardless of whether GI or LID is implemented on public land or on private land. What could these costs be in Ontario and what are the impacts to Ontario taxpayers?

Ontario has over 850,000 hectares of urban land use that
does not have enhanced stormwater management control, and
could be eligible for green infrastructure (LID) retrofits.

Ontario's SOLRIS land use mapping indicates 852,000 hectares of urban land use as of the year 2000. Previously we've estimated the capital cost considering a unit cost of $390,000 per hectare based on Ontario tender costs - see image ar right. All this urban land would in all likelihood have no water quality treatment and be eligible for stormwater managment enhancements. How do we know? Table 1 in the Economic Instruments to Facilitate Stormwater Management on Private Property report indicates that despite the use of quality controls, "Use of enhanced controls is negligible." (see table below).

If we retrofit the untreated area with GI / LID, the annualized cost would be simply $10,000 per hectare x 852,000 hectares = $8.5 billion per year ... forever.

Assuming this cost is allocated to municipalities who benefit from the green infrastructure, and these municipalities distribute the cost to Ontario households, we can estimate the annual household cost. The 2016 census indicates that there are 5,169,170 private households in Ontario meaning a cost of $1650 per household per year. Given household after-tax income of $65,285, the green infrastructure cost would represent about 2.5% of this income.

The Ontario stormwater infrastructure deficit has been estimated at $6.8 billion. If green infrastructure / low impact development lifecycle costs are not funded annually by taxpayers, and debt is used to fund the infrastructure investment, like a green bond, this deficit would double in a single year, and increase by the more than the existing deficit each and every year.

Allocating GI / LID costs seems like a shell game.

Allocating GI / LID costs seems like a shell game, shifting private property costs to the public sector, shifting public sector costs to
the downstream municipalities that accrue potential benefits. In the end there is only one source of funding however.... all of us. Elaborate credit systems, offset schemes, Drainage Act assessments, and fancy 'green bonds' are ways of spreading out the high up-front cost of LIDs. But ultimately, we all pay.

It will be interesting to see the next stages of the study authors' work and how the White Paper could be applied. The report states for example "The White Paper also provides background for a pilot study to be undertaken in the Southdown area of Mississauga. This study will examine the potential of aggregating private commercial property under the Drainage Act to secure installation of communal LID technologies and realize cost-efficiencies." The exploration of the Drainage Act was part of another study under the banner "Aggregated Communal Approaches to Green Infrastructure Implementation". The Drainage Act allows costs to be distributed to landowners across catchments in which improvements are made - the challenge is that landowners against whom costs are assessed have to buy in to the cost-sharing plan and can appeal.