Cost Benefit Analysis

A power station is planned in your local area and you have been requested to submit a primary cost-benefit analysis of the potential economic and environmental impact that the station could have. Prepare a list of pros and cons and a preliminary judgment on whether it should go ahead.

Introduction

Cost benefit analysis is a method that is favored by many because it is a methodology that weighs relative impacts on various interests and the general utility and acceptability of a project. However, Cost Benefit analysis is one methodology that has been faced with a lot of criticism due to its weaknesses concerning how non-monetary values are assessed and also data availability and its reliability. For this assignment I am going to list the various pros and cons associated with a nuclear power station project. The costs associated with this planned project are the high costs of building the plant. These cost estimates should also take into account the investment costs, pre development costs, operating costs and finally the decomposition costs. On the other hand, developing nuclear energy is also associated with numerous benefits that range from environmental, employment benefits, security of supply and other benefits.

Benefits

These benefits range from national to the global level.

Environmental benefits- monetizing all the environmental impacts brought about by nuclear energy generation is practically difficult. The ability of generating power without releasing greenhouse gases is a clear go ahead for execution of the project and nuclear electricity is a project of a kind (Kennedy, 2007).

Security of supply- There is also very little impact on the cost of producing the electricity due to the low share of fuel cost to the production

Employment Benefits- in the cases of large-scale project, this type of benefit is an important positive externality. Employment arises during the planning, operation, construction and also