Botanic Gardens Trust, Sydney, Australia

Cost-Benefit Analysis

The Australian PlantBank will deliver environmental, social and economic returns on the investment. The benefits to be derived from this project are both quantifiable, as well as those that are more difficult to measure. Whilst some benefits will be evident in the short-term, many will not be realised until well into the future.

Economic modelling has calculated PlantBank will generate:

  • $64.8M of economic benefits from its operation and outputs forecast over a 20 year period not including the residual value of the NSW Seedbank collection; and
  • Additional economic impact in excess of $33million in construction related activities and creation of 123 jobs (45 directly employed) over the three years of the project’s development. PlantBank will be created in south-west Sydney (a high State & National priority area for jobs creation).

Non-quantifiable benefits

The benefits to the environment through the creation of a seed repository which holds in perpetuity seeds from the State’s endangered species are immeasurable. The real value of the seed repository and associated research and education programs will only become known if significant environmental change occurs, impacting on biodiversity, productive capacity and economic value. Alongside long-term benefits, immediate non-quantifiable benefits to the environment are significant and include:

  • The ability to use native seeds to restore degraded areas
  • The generation of knowledge regarding plant germination and physiology to inform research and understanding as an insurance against the total loss of endangered native seed species
  • Research benefits by encouraging innovation and building a critical mass in key research areas that would otherwise not be realised
  • Enhancing the State’s reputation as a place for innovation and centre for science research
  • Pubic policy benefits will also flow from PlantBank in the short-term through the Trust’s contribution to climate change action, land use planning and management, and improved educational outcomes
  • Innovative educational experiences and a program to inspire students to pursue scientific careers.

Quantifiable benefits

Whilst many of the benefits are qualitative and difficult to quantify, an analysis of quantifiable benefits has been undertaken. Quantifiable benefits include:

  • Benefits from non paid research contributions to PlantBank through undergraduate and postgraduate students, volunteers and research associates from other institutions
  • Value derived from external use of the NSW Seedbank centralised collection
  • Value of external research grants - from Government, philanthropic and commercial sources - made possible through the expansion of research and collecting activities
  • Additional fees for service and commercial revenue
  • Multiplier effect of the benefit from construction activities.

Quantifiable costs

The costs associated with the development and operation of PlantBank has been modelled using a discount cash flow analysis. With the effect of CPI increases removed, the costs demonstrate the economic cost of investment in PlantBank and its operation.

The capital cost and net cost of operating PlantBank over the next 20 years have been calculated. As the PlantBank facility does not result in a negative impact on the environment or cause consequential losses to other parts of the Trust, no other economic cost has been included in the model. A discount rate of 7% has been applied.

Summary of the Cost Benefit-Analysis

Presented below is a summary of the cost-benefit analysis associated with the development of PlantBank.

Investment in Plantbank

Item NPV 7% Discount Rate
Economic Benefits $90.4 million
Economic Costs ($25.6) million
Residual Value $2.6 million
Net Benefit (Cost) $64.8 million
Benefit/Cost Ratio (total project) 3.53

With a benefit - cost ratio of 3.53 PlantBank is considered value for money, particularly when taking into account the non-quantified benefits to the environment.

 

 

 

Potting mix trial
Potting media experiments

Grevillea robusta
Grevillea robusta fruit

Tissue culture
Tissue culture of Flannel flowers, Actinotus helianthi

Senecio diaschides
Seeds of Senecio diaschides

 

 

 

 

 

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