Bottom up Adaptation Strategies for a Sustainable Europe

Adaptation to storm-surges in Denmark: Who pays?

Per Sørensen, technical director of the Danish Coastal Authority addresses the workshop. Photo: Jørgen Madsen, DBT.


One question is being repeated over and over in Denmark: Who is going to pay for protection against flooding from the sea in the intensified climate of the future? The existing legislation is outdated, and no one has yet produced an adequate funding plan ready. Workshops held by BASE partner the Danish Board of Technology (DBT) explored the perspectives of Danish stakeholders on this critical issue, and identified recommendations for improving Danish legislation.

By Andreas Hastrup Clemmensen, DBT

The Winter 2013 storm in Denmark was an eye opener: storm-surges can affect a range of people, not just those living in low-lying areas. Many cities and landscapes are at risk. The intensified climate of the future means it is necessary to enhance the protection of Danish coasts and settlements against erosion and rising sea levels. But questions remain about who is responsible, and who should pay for the protection. Indeed, this question is a reoccurring theme for BASE partner, the Danish Board of Technology Foundation (DBT), in its work helping municipalities with citizen involvement concerning climate adaptation. Current legislation is not up to date, and so in order to aid with the creation of good and efficient legislation, DBT held a workshop as part of the BASE case study of Copenhagen on the financing of the adaptation to floods. The attendees at the event were stakeholders, experts and representatives from national authorities and coastal municipalities.


Differing interests

In the Netherlands, 65% of the population lives below sea level. As such, there is no argument: securing the coasts is a national responsibility for which the state pays most of the cost. In comparison, Denmark has approximately 7,300 km of coastline, with many low-lying areas. Most cities and many valuable buildings and structures are situated near the waterfront. The soft land erodes and low-lying areas are prone to flooding, especially during storms from the northwest. And yet, interests in the country are divided. The legislation states that responsibility of adaptation lies solely with land owners. An exception to this is the Danish Coastal Protection law, which has been designed for the state to help victims of storm-surges along the western coast of Jutland.
Everybody is pointing to someone else
"Even though it is not wildly expensive to secure the coasts, money is always an issue," says Per Sørensen, technical director of the Danish Coastal Authority. The law requires that the landowners who benefit from coastal protection must pay for it. Local authorities may also force landowners indirectly benefiting from the protection to contribute financially. When it comes down to it, however, it is very difficult to determine exactly which property owners obtain a protective benefit. Per Sørensen points out that it is a matter of interpretation, and that there is no ready template the local councils of the municipalities can use to base their decisions on. If the landowners agree, they themselves can initiate coastal protection measures with the authorisation of the coastal authority. Otherwise, municipalities must take the initiative and coordinate and collect the money. "Municipalities point to the landowners; they must dig into their own pockets. Landowners point to the state; it must be a national matter. And so the wheel turns. In a lot of places they continue to build close to the shore and accept the risk" continues Per Sørensen. The incentive for adaptation is also influenced by the possibility of compensation for any losses. It is the members of the Danish Storm Council who decide if there has been a storm-surge (which, according to the law, is flooding with a 20 year return period) and if the people affected by it can claim compensation. 
Everybody wants to be near the ocean 
“If only people would build a little further away from the coast, the problems would be much less significant,” says Per Sørensen. “But everybody wants to be right by the coast and we have placed ourselves in the problem zone. Kalveboderne in Denmark is an example of a place that used to be only reeds and islets 100 years ago.” The municipalities can demand a build quota and other security measures, but the fact stands that there is a constant expounding of areas situated near the sea to settlements. The three municipalities located at what is known as the ‘Riviera of Denmark’, on the north coast of Zealand, initiated a joint project concerning the beaches at this part of the coast. The project was based on the premise that all the citizens who reside in biking distance from the coast will benefit from broader beaches and coastal protection. The municipalities then suggested that all the landowners within 1000m  of the coast should contribute financially to the project. That would necessitate a payment of 1800 DKK (~240 EUR) a year to the establishment costs and 450 DKK (~60 EUR) yearly in subsequent maintenance costs. Another model only went 500 meters into the country, which made it a bit more expensive. Both models were put to a vote, and the landowners rejected both of them. “The landowners thought it was too expensive. But you do not solve the problem by saying no. Now they have to figure out how to go about solving the problem,” says Per Sørensen.
An agreement between the state and the municipalities
The municipalities wish for a changed distribution of responsibilities and tasks. They want the planning and financing of adaption to future conditions to be arranged with the state. “In connection with the Danish annual budgetary negotiations we imagine that the state and the municipalities can make a common vision,” says Niels Philip Jensen, climate change consultant from the Danish Municipalities organisation, Local Government Denmark. “And we hope that the deal can lead to new legislation, which allows the municipalities to decide for themselves inside an established framework.” The vision is supposed to lead to a definition of the concept ‘particularly vulnerable coasts’. However, questions remain about how to weigh the risk of erosion, the worth of buildings, cultural values, and recreational values? Local Government Denmark believes that once the particularly vulnerable places have been identified, the public should make use of tax money. Furthermore, Local Government Denmark suggests that municipalities with special interests in storm-surge adaptation create a working group that can contribute with coordination and promote adaption. “Since we know that there is a problem it is most natural that the municipalities take the risk of flood more into their planning, so you don’t do anything stupid when building on vulnerable areas,” says Niels Philip Jensen. 
Synergies and neglect 
Niels Philip Jensen points out that, until now, the municipalities have had very different experiences. “The city of Aarhus is a good example of a synergy between the adaption to cloudbursts and the securing against the raising sea level. The city has had torrential rain a couple of times and this puts great values under pressure in the middle of the city. Now they are about to build a lock facing the harbour that can be closed in the event of heavy rain. The water will then be pumped out of the city creek, in order to make more room for the rain. At the same time the harbour front will be elevated, which will secure the city against rising sea levels and storm-surge. It makes good sense - everybody contributes with the payment through the taxes and it does not cost that much for the individual citizen.” “In the city of Frederikssund they have only managed to solve half of the problems. Before the storm in Denmark in 2013 nobody had imagined that the flood would come from the seaside. Hence there was no pressure from the citizens for better coastal protection and no municipality focused on it. Instead they used their energy to care about the local creek valley and the establishment of pools and natural rain drains in order to slow the rain down.” “A third example, which I won’t put a name on, is a theoretical municipality where they say: When the houses vanish, the view becomes better for those in the second row, so what is the problem? This attitude is connected with the unwillingness to pay.”

Line Markert, lawyer and a legal expert in coastal protection addresses the workshop. Photo: Jørgen Madsen, DBT.

The law in a political context
The Danish Coastal Protection law permits municipalities to demand payment from landowners for storm-surge adaptation, and this applies both to people directly and indirectly benefitting from the adaptation activities. Line Markert, lawyer and a legal expert in coastal protection, points out that the municipalities can take it even further, both in relation to neighbouring and landowners if there is an identifiable interest. The municipalities can also use tax income if adaptation serves a general public interest. This includes infrastructure, recreational areas, and tourism – but using tax income should only be done in the absence of appropriate people to undertake or pay for adaptation. “But it becomes difficult when the politicians in the municipalities have to discuss who should pay. And then they start to think about next election. This is the challenging reality that the law must undertake.” 
Recreational value – moneywise
Tourism is a main income in many of the eroding coastal areas at risk of being flooded by the sea. But what is the monetary value of recreation, and is there a reason to demand taxes from, for example, those who rent out their vacation homes? “The Danish Coastal Authorities are working on a quantification of the recreational value. Why will the Danish people pay millions of DKK to go to the west coast of Jutland where it is always windy? In association with Dutch, Belgian and Swedish colleagues we are working on improving our knowledge and quantifying the protection benefits and develop further guidelines that can be transferred to Denmark,” says Per Sørensen.
Who should pay for the protection of Copenhagen against storm-surge? 
The current laws and regulations are insufficient concerning sea level rise adaptation in an urban area like Copenhagen, says the head of Copenhagen municipalities’ Climate Change Unit, Lykke Leonardsen. “We must find a financing model, that not only thinks about the people who own land by the sea, but also the parties who will benefit from the protection of the coast. It is not about small seawalls and dikes from plot to plot. Today it is not possible to impose on a landowner and make them contribute to the purpose. But a lot of businesses have rented offices near the waterfront. The protection also includes their values. And the landowners in the municipalities higher located areas also benefits from the protection of buildings, businesses, business life and cultural values in the inner city and other low lying areas of Copenhagen,” says Leonardsen. If the water level rises 30 cm more than what it did during the storm in 2013, it will affect the buildings and the infrastructure in Copenhagen. Based on the current risk assessment it will start to become a serious problem in the next 20-30 years. 
According to the municipality’s climate adaption plan, one of the opportunities to secure the coast of Copenhagen is to build dikes and lock gates north and south of the harbour. Securing Copenhagen against a sea level 255 cm above normal levels is estimated to cost around 2.3 billion DKK. “The problem is even bigger in some of the smaller provincial towns, with the solutions costing a billion or more, where there is not a lot of tax paying citizens and businesses to split the bill.” “We must recognize that we are faced with a problem that concerns the entire society,” says Lykke Leonardsen. “It might be better to look at the securing of the coast as a matter of national interest the way they do it in The Netherlands. No matter what, the United Danish Municipalities and the Danish government must make a deal.” “It is important that we gather more knowledge and create a joint mapping of the stretches and values that are threatened by the rising sea levels. There is also a need for a clear model to describe the cooperation between neighbouring municipalities. It is no use securing Copenhagen if the water takes a back route through another neighbouring town. We have a well-functioning cooperation with our neighbouring municipalities about the protection of the cities against rainwater but if the tasks becomes too big or too expensive and if there are no ground rules for the distribution of responsibility it can be hard to reach an agreement.” 
Looking ahead
“I’m thinking that you have to propose a legislation that pushes the decision makers to think a 100 years ahead, instead of only thinking about what they dare to inflict the landowners today,” says Line Markert. “We could take this up at the state level or force the municipalities to make long term decisions. The funds that are now used only to pay the victims of flood damage could also be used to co-finance the prevention of damage, because occurrences that only happens every 20 years today most likely will become incidents that in the future happens every 5 years. If you let your fantasy run wild, the possibilities are numerous.”
Objectivity and proportionality
As a public authority, a municipality is required to act professional and proportional. They cannot just order local businesses to pay, nor can theyfinancially support individuals or particular interests. The state administration has made an example by deciding that the municipalities may not spend money on adaptation that supports or secures particular property owners, even though this solution, as a whole, would be cheapest for the community. The current regulation prescribes that if one house is secured by municipal funding, then all the inhabitants in the municipality can demand help. The same goes for local businesses or even particularly threatened structures. On the other hand, the municipality is allowed to expropriate a property if this serves a greater interest to the society. The same goes for the funding of climate adaption and securing against flood with tax income, it is allowed as long as it is in the interest of the society in general.

Adaptation pays off 
There is a common interest in the Netherlands to protect the country against flooding and storm-surges. Joost Stronkhorst from Deltares gave a presentation about the Dutch experiences and principles. The overall theme of his presentation was that taking action not only benefits the safety of citizens, but there are also environmental gains. 
The costs of the establishment of adaption solutions are great initially, but a major part of the money goes to Dutch companies through the outsourcing of projects and the long term economic benefits are greater than the expenses. The wealth that is protected behind the dikes is great: approximately 5.000 billion EUR is protected in the Netherlands by coastal protection. The climate adaption plan of the Netherlands was thoroughly checked after hurricane Katrina and the floods in New Orleans. The result is a hundred year plan concerned with maintaining the security standards and improvements of coastal protection in the entire country. An important part of the work is pumping more sand onto the beaches as counterweight to the natural erosion that accounts for approximately a meter per year on half of the coastline. Furthermore, authorities are counting on reinforcing the buffer zones and dunes. In the plan it is assumed that the sea level will rise 60 cm in the next 100 years. But the plan is flexible: The water level is monitored yearly and they are ready to add more sand to the coasts if the sea starts to rise faster than expected. There is no mentionable resistance against the coastal protection law or the financing of the work, says Joost Stronkhorst.
It is hard to understand the Danish mind-set 
“As long as you keep to the land-owners-pay principal, you will never achieve a sustainable coastal development,” says Joost Stronkhorst. He finds it difficult to understand the Danish mind-set and the reluctance towards coastal adaptation being publicly financed. “The law should fix problems that are shared in the entire society. You can achieve a sustainable business if you plan the improvements, like the Netherlands.” In the Netherlands there is a common agreement that the coastline must be secured, and the protection must be as good as possible. This costs a lot of money, but it is only a fraction of the economic losses we would suffer in the event of a flood. “It is a completely different way of thinking that you have described at this workshop,” says Joost Stronkhorst. “When there is reached a consensus about the public financing in the Netherlands it is tied to the fact that 65 percent of the population lives below sea level. But here in Denmark there are also a lot of buildings and economic activities located near the coasts. This must mean that there is a common interest in establishing a sustainable coastline.” “In the occurrence of a flood, your loss would not be as great as in the Netherlands, but there will be losses. So why not pay the securing of the coast together, as a kind of insurance price?” “But first there must be a plan. The Danish coastline is too extensive to protect completely, and it is not necessary. It would be wise to identify the stretches, which are the most important to protect in consideration of the future generations – and do it in a larger scale than just the individual landowners own adaptation measures against sea level rise and storm-surges.”


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