Economically viable to occupy $15m a year flood damaged areas?
It’s strange that the gist of this article is that “waterfront communities from Southbank to the Mornington Peninsula face a damage bill of more than $1 billion from severe storms and rising sea levels over the next 90 years” but the “Municipal Association of Victoria chief executive Rob Spence said “even under the worst-possible scenarios modelled, the research confirms it is economically viable to occupy the areas.”
I don’t get that. How is $1 billion over the next 90 years or “the annual cost of flooding in Elwood would rise from about $2.5 million in 2011 to $15 million by the end of the century” economically viable. How is a preventable or unnecessary cost economically viable?
Is it that they have worked out that $1billion is less than the increased house / land value based on what has been experienced in the past? But is that a sustainable increased value?
Is it that they have worked out that the increased cost of insurance premiums for the residents of these areas is less than $1billion? But are the insurers going to continue to provide cover in a predictably sea level inundated area?
Or is it that they have worked out that the cost of introducing “measures to counter coastal inundation, including a 20-centimetre floor-level rise in new houses in urban infill development” going to cost less than $1billion?
Either way, what ever the “do nothing” plan is, the cost of it must be less than $1billion in order for it to be economically viable to occupy these areas”.
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