Risk/Benefit Analysis in Water Resources Planning and Management
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1 Risk/Benefit Analysis in Water Resources Planning and Management
2 Risk/Benefit Analysis in Water Resources Planning and Management Edited by Yacov Y. Haimes Center for Large Scale Systems and Policy Analysis Case Western Reserve University Cleveland. Ohio Springer Science+Business Media, LLC
3 Library of Congress Cataloging in Publication Data Engineering Foundation Conference on Risk/Benefit Analysis in Water Resources Planning and Management (1980 : Pacific Grove, Calif.) Risk/benefit analysis in water resources planning and management. Bibliography: p. Includes index. 1. Water resources development Congresses. 2. Risk Congresses. 3. Decisionmaking Congresses. 4. Technology assessment-congresses. I. Haimes, Yacov Y. II. Universities Council on Water Resources. III. Title. TC401.E H ISBN AACR2 ISBN ISBN (ebook) DOI / Proceedings of an UCOWR-sponsored Engineering Foundation Conference on Risk/Benefit Analysis in Water Resources Planning and Management held at the Asilomar Conference Grounds, Pacific Grove, California, September 21-26,1980 Springer Science+Business Media New York 1981 Originally published by Plenum Press, New York in 1981 Softcover reprint of the hardcover 1st edition 1981 All rights reserved No part of this book may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, microfilming, recording, or otherwise, without written permission from the Publisher
4 FOREWORD Ronald M. North President Universities Council on Water Resources People sense intuitively that the world in which we live is not free of risk. Every decision, every action, even the refusal to either act or decide involves some element of risk. Perhaps, because we accept relatively low levels of risk in our daily activities, we tend to minimize the existence of risk and thereby fail to include risk assessment in those decisions and actions which could be improved through a risk assessment process. However, our casual approach to risk assessment seems to stem largely from the difficulties inherent in measuring risk rather than from any lack of cognizance of the existence of risk. This conclusion is evidenced by the many statements in official documents relating to planning and evaluation which suggest that risk assessments should be conducted but do not provide the mechanism for such assessments nor do they encourage their consideration in the decision making process. This conference on Risk/Benefit Analysis in Water Resources Planning and Management is notable because it attempts to identify and evaluate the mechanisms available for risk assessment which might be useful in water resources planning and management efforts. These proceedings bring together the thoughts of professional persons who have struggled with the problems of risk assessment and who have contributed to the refinement of both theoretical and pragmatic solutions for the improvement of risk assessment processes. However, the most significant aspect of these proceedings is that they reflect the opportunities for the exchange of ideas among professionals of various disciplines and among those who are involved with various approaches in different applications. I believe this conference makes a significant contribution to advancing the stateof-the-art as it is now developing in risk/benefit analysis and it v
5 vi RONALD M. NORTH certainly has enhanced the opportunities for further research and development among those who participated in the discussions at the Asilomar Conference Grounds. Those who have attended such conferences at Asilomar will appreciate the unsurpassed opportunities for the interaction of minds and the power of those interactions as they are focused on a specific topic without the distractions of the outside world. Hopefully, these proceedings will reflect the advancements in the state-of-the-art for those who were unable to participate directly. The comments of professionals involved in risk assessment owe a debt of gratitude to Yacov Haimes for his initiation, funding, implementation, and completion of this conference and these proceedings. Without his single-minded dedication to the issues he so clearly recognizes in risk assessment, the conference and these proceedings would not have happened. The Universities Council on Water Resources was pleased to sponsor the resolution which initiated this conference and we were very happy to join the U.S. Water Resources Council and the Office of Water Research and Technology in cosponsoring the conference so ably hosted by the Engineering Foundation.
6 PREFACE The UCOWR-sponsored Engineering Foundation Conference on Risk/ Benefit Analysis in Water Resources Planning and Management was held at the Asilomar Conference Grounds, Pacific Grove, California, September 21-26, 1980, and was attended by about sixty participants from academia, industry, Congress, and federal, state, and local government. The conference's goals and objectives were to: 1) Familiarize the participants with the state-of-the-art in risk/benefit analysis. 2) Explore the feasibility of using risk/benefit analysis in water resources planning and management. 3) Provide a medium conducive to the exchange of information on the conference theme among educators, analysts, managers, and policymakers. 4) Identify and articulate future desired actions designed to alleviate some of the present problems we face in risk/ benefit analysis and risk assessment in general. These proceedings attempt to provide some answers to myriad questions of risks and uncertainties that arise in the formation of public policy in general, and in water resources planning and management in particular. A sample of some generic questions is listed below: a) W h a is ~ the efficacy of models on risk analysis and decision maklng? b) To what extent are these models and methodologies credible? c) To what degree does the value of information increase with more models on risk? vii
7 viii YACOV Y. HAIMES d) How important are the methodologies for the quantification of risk as part of the risk assessment process, and how critical is the understanding of the process itself? e) Who should decide on acceptability of what risks, for whom, and in what terms, and why? [W. W. Lowrance] I would like to thank the Universities Council on Water Resources, the Engineering Foundation, the U.S. Water Resources Council, the Office of Water Research and Technology, U.S. Department of Interior, the Conference Steering Committee, the conference speakers and participants, and Plenum Press for their support, assistance, cooperation, and encouragements. I particularily would like to thank the Editorial Staff of the Center for Large Scale Systems and Policy Analysis, Case Western Reserve University--Virginia Benade, Joyce Martin, and Mary Ann Pelot--for their outstanding help. Yacov Y. Haimes
8 CONTENTS SESSION I: TRADE-OFFS IN 'RISK/BENEFIT ANALYSIS Chairman: Yacov Y. Haimes Case Western Reserve University Opening Remarks and Conference Overview. Yacov Y. Haimes, Conference Chairman Uncertainty: The Water Resources Decision Making Di lemma Leo M. Eisel, Water Resources Council (formerly) Technological Hazards, Risk, and Society: A Perspective on Risk Analysis Research.... Vincent T. Covello, National Science Foundation Risk/Benefit Trade-off Analysis in Water Resources Planning Warren A. Hall, Colorado State University SESSION II: IDENTIFICATION AND MEASUREMENT OF RISK PARAMETERS AND OBJECTIVES Chairman: Vincent T. Covello National Science Foundation Minimizing Risk of Flood Loss in the National Flood Insurance Program Malcolm Simmons, The Library of Congress What Kind of Water Will Our Children Drink? David Okrent, University of California ix
9 x CONTENTS SESSION III: METHODOLOGIES IN (a) MEASURING AND QUANTIFYING RISK AND (b) RISK-BENEFIT TRADE-OFF ANALYSIS Chairman: Warren A. Hall Colorado State University Methodology and Myth William D. Rowe, The American University Risk-Benefit Analysis in a Multiobjective Framework Yacov Y. Haimes, Case Western Reserve University Multiobjective Generating Techniques for Risk/Benefit Analysis.... Jared L. Cohon and Charles S. ReVelle, The John Hopkins University Richard N. Palmer, University of Washington The Risks of Benefit-Cost-Risk Analysis. Ronald A. Howard, Stanford University Methods for Determining the Value of Model Development in Cost/Benefit/Risk Analysis... M. Scott Nainis, Arthur D. Little, Inc SESSION IV: -IMPLEMENTING THE RISK AND UNCERTAINTY PROVISIONS OF THE PRINCIPLES AND STANDARDS Chairman: Gary Cobb u.s. Department of the Interior Application of Risk and Uncertainty Analysis in the Principles, Standards, and Procedures of the U.S. Water Resources Council.... David C. Campbell, U.S. Water Resources Council Risk Analysis Applicable to Water Resources Program and Project Planning and Evaluation... Ronald M. North, The University of Georgia Risk Assessment from a Congressional Perspective James W. Spensley, U.S. House of Representatives Risk Assessment: The Role of Government in a Multiple Objective Framework.... Warren A. Hall, Colorado State University
10 CONTENTS Implementing the Risk and Uncertainty Provisions of the Principles and Standards... David C.N. Robb, St. Lawrence Seaway Development Corporation xi 191 SESSION V: SOCIETAL PREFERENCES FOR RISK AND SAFETY ASSESSMENT AND EVALUATION Chairman: James W. Spensley U.S. House of Representatives Rating the Risks Paul Slovic, Baruch Fischhoff, and Sarah Lichtenstein, Decision Research Risk Assessment: Arid and Semiarid Lands Perspective 219 J. Eleonora Sabadell, U.S. Department of the Interior The Value of a Life: What Difference Does It Make? 233 John D. Graham, National Academy of Sciences James W. Vaupel, Duke University On the Value Dependent Role of the Identification Processing and Evaluation of Information in Risk/Benefit Analysis.... Andrew P. Sage and Elbert B. White. University of Virginia SESSION VI: PANEL DISCUSSION Chairman: Jonathan W. Bulkley University of Michigan The Role of Government in Assessing the Acceptability of Risk and the Efficacy of Safety Jonathan W. Bulkley, University of Michigan (Chairman) Theodore M. Schad, National Research Council David S. Bowles, Utah State University J. Eleonora Sabadell, U.S. Department of the Interior Malcolm Simmons, The Library of Congress Summary, Conclusions, and Recommendations 277 List of Participants 283 Index
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