Benefits have been described in an options assessment largely in terms of what might be avoided by reducing or managing increased flooding risk — fatalities, trauma, property damage, emergency services costs and income loss from displacement.
There might also be improved water quality, ecosystem benefits, enhanced value from new open spaces created and redevelopment opportunities, the report said.
Such benefits could be worth between $2.3 billion and $4.5b if a proactive approach is favoured, consultants have estimated.
The South Dunedin Future programme run by the Dunedin City Council and Otago Regional Council released reports last week that assess ongoing risk from natural hazards and provide seven options for what might be done in response.
One option was a status-quo approach, which had few benefits, and the other six were described as being on a spectrum between "fight", boosting flood defences with built infrastructure, and "flight", or managed retreat.
The approach with the best benefit-to-cost ratio was one in the middle, option 4.
This was characterised as making space for water and wetlands by "implementing a waterway network supported by storage, pipes, pumps, and over-land flow paths".
"Some managed relocation of high-risk properties and assets to make space for water would be needed."
The Portsmouth Dr sea wall would be upgraded between 2060 and 2100, and space such as the former Forbury Park racecourse could be used for water storage.
The benefit-cost ratio was 1, reflecting estimated costs and benefits each tallying to $2.8b.
However, each category was assigned a range and, in that case, the estimated costs were between $2b and $4b, estimated benefits between $2.5b and $3.5b, and the ratio between 0.6 and 1.6.
The higher the ratio, the better.
Advantages listed included high reduction in property damage and trauma, high redevelopment potential, enhanced environmental outcomes, lower likelihood of deaths or injuries, increased economic vitality and maintenance of insurance coverage.
Disadvantages included "loss of existing dwellings to enable connected green open space" and lower topography still being at risk from flooding.
The most similar approach, option 5, was the most expensive at an estimated $7.1b, and it was described both as making space for water and elevating some land.
Any option that involved elevating land — it was also a feature of options 3 and 6 — was more expensive.
However, South Dunedin Future programme manager Jonathan Rowe said some cost might be taken on by developers.
"Obviously, a key feature of raised land is that you have to retreat from the existing space before you can raise it, but the benefit of doing so is that you essentially create a greenfields development area that has a very different risk profile than what was there prior, so much lower-risk," he said.
Mr Rowe said it had not been determined for any of the options what the distribution of costs might be among public bodies and private interests, although the status quo seemed to leave much of the burden on property owners.
Option 5 had the highest estimated benefit at $4.5b and the benefit-cost ratio was 0.7, or a range between 0.4 and 0.9.
The two options at each end of the "fight and flight" spectrum both had a benefit-cost score of 0.7.
Option 2 would be principally about upgrading pipes and pumps, while option 7 would involve large-scale retreat.
Option 2’s benefits were projected to be about $2.3b, against estimated costs of $3.2b, and option 7 had projected benefits of about $3.7b, against estimated costs of $5b.
Many of the benefits or advantages identified would occur through several options, although it was noted the infrastructure-focused option 2 "misses most of the opportunities for improving the urban and natural environment".
It was indicated water storage would still occur at sites such as Forbury Park under option 2.
The options assessment said benefit-cost ratios of 0.8 were generally accepted as being a good return on investment.
However, it was acknowledged the ratios should not be the single determining factor in the options selection process.
"It may not capture important qualitative factors like environmental impact, social equity or strategic alignment," the document said.
Mr Rowe said the $2b cost assigned to the status-quo approach included accounting for expected storm damage.
The options assessment suggested the true cost would be higher.
"Notably, it is expected that the costs will climb higher still once social costs including stress suffered by affected residents and business owners are factored in, or in response to major weather events where the costs of recovery could be substantially higher."
Councillors from both councils are set to discuss the material this week.
A snapshot
• Option 1: Status quo, carry on with roughly the same approach as now.
• Options 2 and 3: Boost infrastructure to manage flood risks.
• Options 4 and 5: Make some space for water and enhance infrastructure.
• Options 6 and 7: Let the water in and move a lot of people out of harm’s way.
• Elevating land is a key component of options 3, 5 and 6.
