Habitat equivalency analysis, a framework for forensic cost evaluation of environmental damage

When environmental damage takes place, forensic experts investigate and undertake initial damage assessments. Determining damage costs can be challenging in terms of remedial action and of assigning monetary value to losses. We develop a Habitat Equivalency Analysis (HEA) framework to assess environmental damage costs and apply it to three case studies from the Brazilian Atlantic Rainforest (BAR). Remediation costs have been used previously as proxies for valuing ecosystem services (ES). In this approach, interim losses, those ES not supplied till the damage is restored, are accounted as compensatory remediation costs, the costs of resource enhancement or creation that compensates for the loss in ES provision. We compared values derived here to those using an alternative valuation, based on a tropical forest’s average annual value (Int.$/ha/year), as described in the literature. Findings demonstrate the potential of the framework to account for interim losses, perpetual damages and the cost of remediation. Although the three study areas varied in the extent of damage and the remediation procedures, the damage cost per hectare was of the same order of magnitude and within a narrow range: 13,216; 28,024; and 19,681 (in 2017 Int.$/ha) for the Citrus; Sand Mining and Eucalyptus study areas respectively. The environmental damage costs per hectare appraised by the alternative valuation were higher and showed greater variation: 32,692; 139,389; and 38,260 (in 2017 Int.$/ha) respectively. The experimental data were shown to be within the range of theoretical results derived. As HEA valuation is solely based on ecosystem damage remediation principles, its application will provide a more robust platform for the evaluation of the total economic value of tropical forests, even in the early stages of damage assessments.