Environmental impact assessment (EIA)

An Environmental Impact Assessment (EIA) is a specific form of CBA which involves drawing together, in a systematic way, an assessment of a project's likely significant environmental effects. It is often used in planning and development projects. It is a requirement for certain types of project before they can be given 'development consent'. An EIA seeks to identify the environmental implications of a particular policy action or spending programme, both desirable and undesirable. It is considered as a way of helping to promote a sustainable pattern of physical development and land and property use in cities, towns and the countryside. In the UK there is also an additional requirement that the main alternative approaches must be outlined and the rationale for the final project chosen must be provided.


It is used primarily by Government agencies as a preventative measure. It was first implemented in the US in 1969. Subsequently it was implemented in the EU, in 1985, and in the UK in 1990.

In the UK, EIA divides projects into two main types, schedule 1 and schedule 2. Schedule 1 projects require an EIA in every case, while Schedule 2 projects require an EIA, only if the project is judged likely to result in significant environmental effects. Schedule 1 projects include energy, extraction of raw materials, intensive agriculture, metal production and processing, and chemicals among others (for a full list of projects see DCLG, 2010). Schedule 2 projects are determined as requiring an EIA dependent on the characteristics, location, and potential impacts of the project.

Characteristic considerations include:

  • the size of the project;
  • the cumulation with other projects;
  • the use of natural resources;
  • the production of waste;
  • pollution and nuisances;
  • the risk of accidents, having regard in particular to substances or technologies used.

Location factors considered include:

  • the existing land use;
  • the relative abundance, quality and regenerative capacity of natural resources in the area;
  • the absorption capacity of the natural environment.

Potential impacts include:

  • the extent of the impact (geographical area and size of the affected population);
  • the transfrontier nature of the impact (i.e. does it cross country borders or boundaries);
  • the magnitude and complexity of the impact;
  • the probability of the impact;
  • the duration, frequency and reversibility of the impact.

Criticisms of EIA

EIA faces some of the same difficulties as more standards forms of CBA, including problems of quantification, particularly in applying monetary values to environmental impacts.

As a result some scholars and policy makers argue that EIAs practical policy-making value is somewhat limited.



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This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.

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This resource was created by Dr Dan Wheatley. The project was funded by the Economics Network and the Centre for Education in the Built Environment (CEBE) as part of the Teaching and Learning Development Projects 2010/11.


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