Integrid - Bridging the Gap

56 5. COST-BENEFIT ANALYSIS This chapter will explain the Cost benefit Analysis (CBA). The aims and scope of CBA will be first explained, after which the general approach and methodology will be explained. Insights will then be provided on the demo and High-Level Cases of Use (HLUCs) on which CBA is performed. As a detailed description of all HLUC’s results and methodology would provide an excessive amount of information, the overview focusses only on the aim of the HLUC, the NPV and a summary of the main conclusion is given. For more detailed information or a description of other HLUCs, please consult the CBA report, the final deliverable of WP7. AIM AND SCOPE of CBA This CBA is part of WP7 of the InteGrid project and aims to compare the costs and benefits of multiple InteGrid solutions. CBA is performed for the Portuguese, Slovenian and Swedish demos on an HLUC-basis; Per HLUC, the costs and benefits are discounted over the lifetime of the project, resulting in a Net Present Value (NPV). General approach and methodology JRC methodology . CBA follows the methodology developed by the European Commission’s Joint Research Centre, referred to as the JRC-methodology. This methodology covers three steps: 1. Define boundary conditions & set parameters 2. Perform cost-benefit analysis (CBA) 3. Perform sensitivity analysis For the second step of CBA, the JRC methodology sets out 7 stages for performing CBA, which are shown in the figure below: Characterise the project Estimate benefits Compare costs and benefits 1. Review and describe technologies, elements and goals of the project 2. Map assets onto functionalities 3. Map functionalities onto benefits 4. Establish the baseline 5. Monetise benefits and identify beneficiaries 6. Quantify costs 7. Compare costs and benefits