The report provides an overview of existing guidelines and manuals related to the assessment of costs and benefits of river restoration. Although there exist many cost-benefit analysis handbooks, there are not many related specifically to river restoration. This report aims to fill this gap, and focuses on the specific characteristics of the estimation of costs and benefits related to river restoration. The report discusses the classification and assessment of costs and benefits of river restoration, and develops a benefits transfer approach that can be used to assess benefits when it is not possible to carry out primary valuation research. Key methodological issues in a CBA of river restoration are identified, discussed and illustrated. The report provides a number of practical recommendations to practitioners.

Water policies are often evaluated primarily on the basis of their financial (budgetary) costs, as these can be assessed relatively easily. The calculation of all costs and benefits, including second-order indirect effects on sectors and non-priced environmental effects, often also referred to as the broader social costs and benefits, is a more difficult task. Social cost-benefit analysis is a widely applied method for evaluating public water policies, since government interventions are often related to the provision of public goods, having an impact on society as a whole. Such impacts should consequently be valued and evaluated from a societal perspective, not the perspective of the investor only such as a central or local government or a private company. Restored or ‘natural’ river corridors typically have the potential to provide a wide range of ecosystem services. It is the wider social value attached to these ecosystem services besides their ecological value that is often missing in information supply supporting river restoration policy and decision-making.

Keywords: River restoration, Cost-benefit analysis, Non-market valuation, Benefits transfer.