Presentation Flora Anvarifar on multi-functional flood defences - DUWC kick-off

1. Flora Anvarifar
PhD researcher
TU Delft
&
Flood Resilience
Group (FRG)

2. Background:
Flood Mitigation challenges in Urban
Areas
Main challenges:
•Flood defence strengthening is problematic for city view
•There is a space competition between urban growth and flood
protection demands
Promising solution:
A flood defence has no longer one function
Multiple functions can be added around the defence system
Multifunctional flood defences can fulfil societal functions in addition
to flood protection
How can we score different possible multifunctional options to
priorities the most effective and efficient ones?

3. Problem:
Embedded Deep Uncertainties
Magnitude of Speed of
climate change? climate change?
Urban Model
Growth rate? inputs/outputs
Unknown
unknowns!!!
We don’t know how to protect ourselves from the adverse
consequences of climate change due to lack of knowledge about the
costs and benefits of different available alternatives

4. Solution:
Real Options (RO) Analysis
What is RO?
• a framework to incorporate flexibility into decision making
• assumes some choices in when to invest
• there is an opportunity, but not an obligation, to go ahead with!
Why to use RO?
• We may know more in the future
• There is no precise valuation method for cash flow analysis
• NPV is not efficient anymore (fixed discount rate/life time of assets)
How to use RO?
• We can delay investments to a better time in future
• Deferring, abandoning, expanding the project stages
Real options analysis values the flexibility to respond to uncertain
events whilst net present value techniques do not and consequently
undervalue everything.

5. Core Idea:
Application of RO for the Design of
Multifunctional Flood Defences
Dealing with embedded uncertainties requires flexible and
adaptable solutions
Patenting new technologies requires observation of market
development
Multifunctional flood defences seems a promising design concept
in highly urbanised flood prone areas
Embodying multifunctional flood defences requires
irreversible/costly reversible investments
This turns out to be partly resolved by application of real options theory

6. Final Goal:
Developing a quantitative approach for the
evaluation of the options during the design
phase and comparing them with more
traditional approaches