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Environmental Impact Assessments

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The term used as the title of this article, environmental impact assessments, has now been increasingly, but not universally, replaced with the term environmental assessments. A quick review of the reason for this change of name will help us define the essential nature of the activity described by these names, and one of the important factors behind opposition or reluctance to using the word impact.

In 1970, the National Environmental Policy Act (NEPA) became law in the United States, establishing environmental policy goals for the federal government, focusing on the need to take environmental factors into account in decision-making. It is, of course, easy to state a policy objective, but it is more difficult to achieve it. To ensure that the Act had “teeth”, legislators incorporated a provision requiring that the Federal government prepare an “Environmental Impact Statement” (EIS) for any proposed action “likely to significantly affect the quality of the human environment”. The content of this document was to be considered before a decision was made on whether the proposed action should be initiated. The work done to prepare the EIS became known as environmental impact assessment (EIA), because it involved the identification, prediction and evaluation of the impacts of the proposed federal action.

The word “impact”, in English, unfortunately is not a positive term. An impact is thought to be harmful (almost by definition). Therefore, as the practice of EIA spread beyond the United States to Canada, Europe, Southeast Asia and Australasia, many governments and their advisers wanted to move away from the negative aspects of impact, and so the term environmental assessment (EA) was born. EIA and EA are identical (except in the United States and those few countries which have adopted the US system, where EIA and EA have precise and different meanings). In this article only EIA will be referred to, although it should be remembered that all comments apply equally to EA, and both terms are in use internationally.

In addition to the use of the word impact, the context in which EIA was applied (particularly in the United States and Canada) was also influential on the perceptions of EIA which were (and in some cases still are) common amongst politicians, senior governmental officials and private and public-sector “developers”. In both the United States and Canada, land-use planning was weak and preparation of EISs or EIA reports were often “hijacked” by interested parties and almost became plan-making activities. This encouraged the production of large, multi-volume documents which were time-consuming and expensive to produce and, of course, virtually impossible to read and act upon! Sometimes projects were delayed while all this activity was in progress, causing irritation and financial costs to proponents and investors.

Also, in the first five to six years of its operation, NEPA gave rise to many court cases in which project opponents were able to challenge the adequacy of EISs on technical and sometimes procedural grounds. Again, this caused many delays to projects. However, as experience was gained and guidance was issued that was more clear and strict, the number of cases going to court declined significantly.

Unfortunately, the combined effect of these experiences was to give the distinct impression to many external observers that EIA was a well-intentioned activity which, unfortunately, had gone wrong and ended by being more of an obstacle than a help to development. To many people, it seemed an appropriate, if not entirely necessary, activity for self-indulgent developed countries, but for industrializing nations it was an expensive luxury they could not really afford.

Despite the adverse reaction in some places, globally the spread of EIA has proved irresistible. Starting in 1970 in the United States, EIA extended to Canada, Australia and to Europe. A number of developing countries—for example, the Philippines, Indonesia and Thailand—introduced EIA procedures before many Western European countries. Interestingly, the various development banks, such as the World Bank, were amongst the slowest organizations to introduce EIA into their decision-making systems. Indeed, it was only by the late 1980s and early 1990s that the banks and the bilateral aid agencies could be said to have caught up with the rest of the world. There is no sign that the rate at which EIA laws and regulations are being introduced into national decision-making systems is becoming slower. In fact, following the “Earth Summit” held in Rio de Janeiro in 1992, EIA has been used increasingly as international agencies and national governments attempt to meet the recommendations made in Rio regarding the need for sustainable development.

What is EIA?

How can we explain the ever-increasing popularity of EIA? What can it do for governments, private and public sector developers, workers, their families and the communities in which they live?

Before EIA, development projects such as highways, hydro-power dams, ports and industrial installations were assessed on technical, economic and, of course, political bases. Such projects have certain economic and social objectives to achieve, and decision-makers involved in issuing permits, licences or other types of authorization were interested in knowing whether the projects would achieve them (putting to one side those projects conceived and built for political purposes such as prestige). This required an economic study (usually cost-benefit analysis) and technical investigations. Unfortunately, these studies did not take account of environmental effects and, as time passed, more and more people became aware of the increasing damage caused to the environment by such development projects. In many cases, the unintended environmental and social impacts led to economic costs; for example, the Kariba Dam in Africa (on the border between Zambia and Zimbabwe) resulted in the resettlement of many villages into areas which were not suitable for the traditional agriculture practised by the people. In the resettled areas food became scarce and the government had to initiate emergency food supply operations. Other examples of unexpected “add-on” costs as well as environmental damage led to a growing realization that the traditional project appraisal techniques needed an additional dimension to reduce the chances of unexpected and unwelcome impacts.

The increasing awareness amongst governments, non-governmental organizations (NGOs) and members of the public of the unexpected economic penalties that could arise from major development projects coincided with a parallel growth in global understanding of the importance of the environment. In particular, concern focused on the implications of increasing population growth and the accompanying expansion in economic activities, and whether there might be environmental constraints to such growth. The importance of global biogeochemical and other processes for the maintenance of clean air and water as well as renewable resources such as food and timber were recognized increasingly. As a result, many were convinced that the environment could no longer be seen as a passive and never-ending deliverer of goods and a receiver of human wastes. It had to be seen as an active part of the development process which, if treated badly, could reduce the chances of achieving development objectives. This realization has led to the development and implementation of a number of procedures or practices to incorporate the environment into the development process by considering the extent to which it might be harmed or improved. One such procedure is EIA. The overall aim is to reduce the risk—for homo sapiens in general, and local groups in particular—that environmental damage will result in life-threatening consequences such as famines and floods.

Basically, EIA is a means of identifying, predicting and evaluating the environmental impacts of a proposed development action, and its alternatives, before a decision is made to implement it. The aim is to integrate EIA into the standard, pre-feasibility, feasibility, appraisal and design activities which are carried out to test whether a proposal will meet its objectives. By undertaking EIA work in parallel with these studies it should be possible to identify, early, the significant adverse impacts (and those which are beneficial) and to “design out”, as far as possible, the harmful impacts. Additionally, benefits can be enhanced. The outcome of any EIA should be a proposal which, in its location, design and method of construction or operation, is “environmentally friendly” in so far as its environmental implications are acceptable and any environmental deterioration is unlikely to cause difficulties. EIA is, therefore, a preventive tool, and medicine provides an appropriate analogy. In the field of community medicine it is better, and economically cheaper, to prevent illness rather than cure it. In the development process it is better to minimize environmental damage (while still achieving economic objectives) than to fund expensive clean-up or rehabilitation actions after damage has occurred.

Application of EIA

To what types of development activities does EIA apply? There is no standard or correct answer. Each country decides on the type and scale of activities to be subject to EIA; for example, a proposed 10 km road in a small tropical island may cause significant impacts, but a similar road in a large, semi-arid country with a low population density probably would be environmentally neutral. In all countries, EIA is applied to “physical” development projects according to national criteria; in some countries EIA is applied also to development plans, programmes and policies (such as sector development programmes for energy supply and national development plans) which might cause significant environmental impacts. Amongst the countries which apply EIA to these kinds of actions are the United States, the Netherlands and China. However, such countries are the exception to normal practice. Most EIAs are prepared for physical development projects, although there is no doubt that “strategic” EIAs will increase in importance in the future.

What kinds of impacts are analysed in EIAs? Again this varies from country to country, but to a lesser extent than in the case of the types of proposed activities subject to EIA. The usual answer given is “environmental” impacts, to which the inevitable response is likely to be, “Yes, but what is ‘environmental’?” Generally, most EIAs focus on the biophysical environment—that is, impacts on such factors as:

  • water quality and quantity
  • air quality
  • ecosystems and ecological processes
  • noise levels.


In some cases no other impacts are considered. However, the limitations of restricting EIA to biophysical impacts have been questioned and, increasingly, more and more EIAs are based on a broad concept of the environment and include, when appropriate, impacts on:

  • local communities (“social” impacts)
  • local economies
  • health and safety
  • landscapes
  • cultural resources (archaeological or historical sites, environmental features with spiritual significance for local communities, etc.).


There are two reasons which help explain this wider definition of “environmental” impacts. First, it has been found to be socially and politically unacceptable to consider the impacts of a proposal on the biophysical environment and, at the same time, ignore the social, health and economic effects on local communities and inhabitants. This issue has been dominant in developed countries, especially those which have weak land-use planning systems into which social and economic objectives are incorporated.

In developing countries, this factor also exists and is joined by an additional, complementary explanation. The majority of the population in developing countries has a closer and, in many ways, more complex set of direct relationships with their environment than is the case in developed countries. This means that the way that local communities and their members interact with their environment can be changed by environmental, social and economic impacts. For example, in poor localities a major, new project such as a 2,400 MW power station will introduce a source of new labour opportunities and social infrastructure (schools, clinics) to provide for the large workforce needed. Basically, the income injected into the local economy makes the power station locality an island of prosperity in a sea of poverty. This attracts poor people to the area to try to improve their standard of living by trying to obtain a job and to use the new facilities. Not all will be successful. The unsuccessful will try to offer services to those employed, for example, by supplying firewood or charcoal. This will cause environmental stress, often at locations distant from the power station. Such impacts will occur in addition to the impacts caused by the influx of workers and their families who are directly employed at the station site. Thus, the main induced social effect of a project—in-migration—causes environmental impacts. If these socioeconomic implications were not analysed, then EISs would be in danger of failing to achieve one of their main objectives—that is, to identify, predict, evaluate and mitigate biophysical environmental impacts.

Virtually all project-related EIAs focus on the external environment, that is, the environment outside the site boundary. This reflects the history of EIA. As noted above it had its origins in the developed world. In these countries there is a strong legal framework for occupational health protection and it was inappropriate for EIA to focus on the internal, working environment as well as the external environment, as this would be a duplication of effort and misuse of scarce resources.

In many developing countries the opposite situation is often the reality. In such a context, it would seem appropriate for EIAs, particularly for industrial facilities, to consider the impacts on the internal environment. The main focus of considering such impacts as changes in internal air quality and noise levels is the health of workers. There are two other aspects which are important here. First, in poor countries the loss of a breadwinner through illness, injury or death can force the other members of a family to exploit natural resources to maintain income levels. If a number of families are affected then the cumulative impacts may be locally significant. Secondly, the health of family members can be affected, directly, by chemicals brought into the home on the clothes of workers. So there is a direct link between the internal and external environments. The inclusion of the internal environment in EIA has received little attention in the EIA literature and is conspicuous by its absence from EIA laws, regulations and guidelines. However, there is no logical or practical reason why, if local circumstances are appropriate, EIAs should not deal with the important issues of workers’ health and the possible external implications of a deterioration in the physical and mental well-being of workers.

Costs and Benefits of EIAs

Perhaps the most frequent issue raised by those who are either opposed to EIA or are neutral towards it concerns the cost. Preparation of EISs takes time and resources, and, in the end, this means money. It is important, therefore, to consider the economic aspects of EIA.

The main costs of introducing EIA procedures into a country fall on project investors or proponents, and central or local government (depending on the nature of the procedures). In virtually all countries, project investors or proponents pay for preparation of EIAs for their projects. Similarly, initiators (usually government agencies) of sectoral investment strategies and regional development plans pay for their EIAs. Evidence from developed and developing countries indicates that the cost of preparing EISs ranges from 0.1% to 1% of the capital cost of a project. This proportion can increase when mitigating measures recommended in the EISs are taken into account. The cost depends on the type of mitigation recommended. Obviously, resettling 5,000 families in such a way that their standard of living is maintained is a relatively costly exercise. In such cases the costs of the EIS and mitigation measures can rise to 15 to 20% of capital cost. In other cases it may be between 1 and 5%. Such figures may seem to be excessive and to indicate that EIA is a financial burden. There is no doubt that EIA costs money, but in the experience of the author no major projects have been halted because of the costs of EIA preparation, and in only a few cases have projects been made uneconomical because of the costs of necessary mitigating measures.

EIA procedures also impose costs to central or local governments which arise from the staff and other resources which need to be directed to managing the system and processing and reviewing the EISs. Again, the cost depends on the nature of the procedure and how many EISs are produced per year. The author is not aware of any calculations which attempt to provide an average figure for this cost.

To return to our medical analogy, prevention of illness requires a significant up-front investment to ensure future and possibly long-term dispersed benefits in terms of the health of the population, and EIA is no different. The financial benefits can be examined from the perspectives of the proponent as well as those of the government and the wider society. The proponent can benefit in a number of ways:

  • prevention of delays in obtaining authorizations
  • identification of mitigation measures involving recycling and recovery of components of waste streams
  • creation of cleaner working environments
  • identification of cheaper alternatives.


Not all of these will operate in all cases, but it is useful to consider the ways in which savings can accrue to the proponent.

In all countries various permits, permissions and authorizations are needed before a project can be implemented and operated. The authorization procedures take time, and this can be extended if there is opposition to a project and no formal mechanism exists by which concerns may be identified, considered and investigated. There seems little doubt that the days of passive populations welcoming all development as signs of inevitable economic and social progress are nearly over. All projects are subject to increasing local, national and international scrutiny—for example, the continuing opposition in India to the Sardar Sarovar (Narmada) complex of dams.

In this context, EIA provides a mechanism for public concerns to be addressed, if not eliminated. Studies in developed countries (such as the UK) have shown the potential for EIA to reduce the likelihood of delays in obtaining authorizations—and time is money! Indeed, a study by British Gas in the late 1970s showed that the average time taken to obtain authorization was shorter with EIA than for similar projects without EIA.

The add-on costs of mitigation have been mentioned, but it is worth considering the opposite situation. For facilities which produce one or more waste streams, the EIA may identify mitigation measures which reduce the waste load by use of recovery or recycling processes. In the former case recovery of a component from a waste stream might enable the proponent to sell it (if a market is available) and cover the costs of the recovery process or even make a profit. Recycling of an element such as water can reduce consumption, thus lowering expenditure on raw material inputs.

If an EIA has focused on the internal environment, then the working conditions should be better than would have been the case without the EIA. A cleaner, safer workplace reduces worker discontent, illness and absences. The overall effect is likely to be a more productive workforce, which again is a financial benefit to the proponent or operator.

Finally, the favoured option selected using solely technical and economic criteria may, in fact, not be the best alternative. In Botswana, a site had been selected for water to be stored before it was transported to Gaborone (the capital). An EIA was implemented and it was found, early in the EIA work, that the environmental impacts would be significantly adverse. During survey work, the EIA team identified an alternative site which they were given permission to include in the EIA. The alternative site comparison showed that the environmental impacts of the second option were much less severe. Technical and economic studies showed that the site met technical and economic criteria. In fact it was found that the second site could meet the original development objectives with less environmental damage and cost 50% less to build (IUCN and Government of the Republic of Botswana, undated). Unsurprisingly, the second option has been implemented, to the benefit not only to the proponent (a parastatal organization) but to the entire tax-paying population of Botswana. Such examples are likely to be uncommon, but do indicate the opportunity provided by EIA work to “test” various development options.

The main benefits of EIA procedures are dispersed amongst the component parts of society, such as government, communities and individuals. By preventing unacceptable environmental deterioration EIA helps to maintain the essential “life processes” upon which all human life and activities depend. This is a long-term and dispersed benefit. In specific instances, EIA can avoid localized environmental damage which would necessitate remedial measures (usually expensive) at a later date. The cost of remedial measures usually falls on local or central government and not the proponent or operator of the installation which caused the damage.

Recent events, especially since the Rio “Earth Summit”, are slowly changing the objectives of development activities. Until recently the objectives of development were to improve economic and social conditions in a specified area. Increasingly, the achievement of “sustainability” criteria or objectives is occupying a central place in the traditional hierarchy of objectives (which still remain relevant). The introduction of sustainability as an important, if not yet primary, objective in the development process will have a profound influence on the future existence of the sterile debate of “jobs versus environment” from which EIA has suffered. This debate had some meaning when environment was on the outside of the development process and looking in. Now the environment is becoming central and the debate is centred on mechanisms of having both jobs and a healthy environment linked in a sustainable manner. EIA still has a crucial and expanding contribution to make as one of the important mechanisms for moving towards, and achieving, sustainability.



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