Sustainable Asset Valuation

Policy makers, infrastructure planners and investors all ask about the value-added of sustainable infrastructure.

  • Are such assets more expensive to plan and build and finance?
  • Do they bring better value for money?
  • What are the risks associated with greener designs and cleaner technologies?

We are also waking up to reality of climate change and range of other environmental, social and economic risks. Insurance firm Swiss Re, estimates that in 2017, the economic losses from natural disasters was US$ 306 billion. This is almost the double of the losses in 2016, which was US$ 188 billion and also much higher than the 10-year-average of $190 billion.

Such risks and externalities are typically ignored in infrastructure finance analyses. The MAVA Foundation and IISD built SAVi to address such inconsistencies. We built SAVi to make the investment case for sustainable infrastructure.

Using SAVi

SAVi incorporates 3 fundamental features:

Valuation: SAVi values in financial terms, the material risks and co-benefits of infrastructure projects. We work with governments and investors to identify the risks material to their projects and design appropriate simulation scenarios.

Simulation: SAVi is unique in that it combines the results of systems thinking and system dynamics simulation with project finance modelling. We work with governments and investors to identify the material risks of each infrastructure project. We also identify co-benefits that contribute towards realising the UN sustainable development goals. We then determine the simulation scenarios.

Bespoke: The application of SAVi is bespoke. We customise SAVi to each individual infrastructure project. Such an approach is required as each project is characteristic of distinctive opportunities and risks.

SAVi can hence answered questions such as:

  • Do sustainable infrastructure assets bring better financial returns than business-as-usual counterparts?
  • What additional capital is required to make this asset more resilient to changing climates?
  • In a given pipeline or portfolio, which asset make the higher contributions toward the UN Sustainable Development Goals?

The SAVi website is under construction.

Content provided by developer.

Who is it for? (NB. Decision makers (e.g. financiers, public authorities))
Sector specific?No
Value Chain Stage: ,
Diagnose & ConceiveDesign & DeliverOperate & Maintain

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