An objective and practical model for economic evaluation of environmental investment projects

Summary

The problems faced by business as a result of the growth of the environmental agenda are described. The consequence this has on investment decisions is outlined and the trend, largely induced by present day investment appraisal techniques, for adopting ‘end-of-pipe’ rather than ‘Clean’ technology solutions is explained. A solution to this reactive investment approach is described by way of the Paras model. This adopts a holistic and practical approach and considers the special nature of environmental investments throughout all stages of the analysis. By objectively incorporating a measure for uncertainty within the analysis it adds considerable value and rationality to the decision-making process. The collaborative research project between the University of Surrey and Paras Ltd is described. This is run under the Engineering Doctorate programme and aims to develop a multicriteria decision tool to support the parallel quantification of the environmental and financial performance of investment projects.