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Cost-Benefit Analysis (CBA)

ICF International has conducted cost-benefit and cost-effectiveness analyses in a variety of settings. Policy analysis increasingly relies on cost-benefit analysis and cost-effectiveness analysis to determine the net impacts of a policy, and the least-cost option among policy choices.

Selected Projects

In particular, ICF economists have developed valuable insights into cost-benefits analyses through projects that aimed to quantify benefits and costs that fall outside of the bounds of typical market activity, and thus are not readily expressed in monetary terms.

SELECTED PROJECTS

Analysis of the Acid Deposition and Ozone Control Act (S. 172)

ICF produced a comprehensive report on the costs, benefits, and other impacts of a multi-pollutant utility emissions control program, synthesizing the results of its own analyses and input from subcontractors and other agencies. The proposed program would have cut utility emissions of SO2 and NOx well below the levels provided for under the 1990 Acid Rain program, using an extension of the cap-and-trade mechanism introduced by that program. ICF analyzed the emissions and cost effects of the caps that S. 172 would impose using IPM®, ICF's linear programming model of the electric utility sector. ICF also analyzed the effects of these emission changes on air concentrations using a combination of air quality models, and then supervised the translation of these air quality changes into benefits. Then the results of these analyses were presented in a clear and highly accessible written report, using full-color diagrams and maps to explain the effects of changing emissions on air quality. The report was aimed at making the issues and analyses clear to nonspecialists, while including more technical material in boxes and appendices to ensure that the report would convey authority.

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Costs and Benefits of Environmental Infrastructure Improvements

In this project for the Mexican environmental agency and the World Bank, ICF conducted a wide-ranging study of the relative costs and benefits of projects to alleviate environmental problems near the delta of the Coatzacoalcos River in Southern Mexico. The projects examined included the conversion of vehicles to natural gas, expansions of sewer systems, wastewater treatment plants, potable water systems, storage facilities for hazardous wastes, pipeline safety programs, and municipal waste collection and disposal systems. For each project, ICF contrasted an estimate of the potential reduction in risks to human health with the costs of implementation.

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Cost-Benefit Analysis of the Hours-of-Service Rule

For a critical rulemaking regarding the limits on the hours truck drivers are allowed to work and drive, ICF conducted an extensive cost-benefit analysis of options aimed at reducing driver fatigue, and the subsequent impacts of these options on carriers of different sizes. For estimating the social costs of the options, ICF constructed and used econometric and spreadsheet models to estimate the labor and non-labor costs. ICF also estimated the benefits of these options using models that relate sleep and work patterns to fatigue-related accidents involving trucks. This analysis enabled ICF to determine the reductions in crashes that can be expected under the different options. Estimating costs and benefits also allowed ICF to analyze impacts on carriers, including small independent owner operators. Learn more about ICF's transportation policy and strategy services.

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Evaluation of Employee Benefits Security Administration (EBSA) Regulatory Review Program

EBSA’s mission is to protect and foster employee pension, health, and other benefit plans in the private sector through education, enforcement, and compliance assistance. As a result of its recent Performance Assessment Rating Tool assessment, EBSA developed a regulatory review program that included a commitment to develop ways to quantify and reduce the burdens imposed on employers by its regulations. EBSA selected ICF to conduct a Cost-Benefit Analysis (CBA) on three regulations selected by EBSA for its regulatory review program, including development of a CBA methodology and associated protocols appropriate to EBSA regulations. ICF is working closely with EBSA to examine the economic factors, quantify them using CBA, and provide recommendations to EBSA to “quantify and reduce the burden imposed by its regulations.” ICF’s ASPIRE® for Program Evaluation model will be used to ensure that all aspects of the agency and program are addressed, including mission and goals, people and human resources, stakeholders, processes, and outcomes.

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