In the last few decades, the frequency of large, intense wildfires has increased in many places around the world. These fires have caused significant social, economic and environmental impacts. They have also contributed to significant increases in suppression expenditures (i.e. fire-fighting expenditures). Currently, there is a risk that Australia will continue to increase its fire-fighting capacity and suppression expenditures without improving its management of fire in the landscape.
Prescribed burning – the planned application of fire to the landscape under milder climatic conditions – is used in many fire-prone landscapes to mitigate the impacts of wildfires and protect human and ecological assets. Recent wildfire events in Australia have prompted State governments to encourage the increase of prescribed burning in parts of the country. For instance in the State of Victoria, after the events of Black Saturday in February 2009, the Royal Commission investigating these events recommended an increase in prescribed burning to an annual rolling target of 5% minimum of public land in the State. In WA, after a wildfire that started near Northcliffe burned nearly 100,000 hectares, the State Budget provided an extra AU$20 million to the Department of Parks and Wildlife (DPaW) to help the Department meet its prescribed burning targets.
This increased focus on prescribed burning to mitigate potential wildfire effects has generated considerable debate (Penman et al. 2011). Much of this debate revolves around the efficacy of prescribed burning in reducing wildfire extent and severity (Fernandes and Botelho 2003), but little attention has been given to the economic impacts of prescribed burning programs and the trade-offs in the allocation of resources between different fire management activities. To decide on the appropriate level of investment in prescribed burning, fire managers need to have a clear picture of the costs and benefits of the practice and the consequences of changing the level of investment. However, studies that elucidate these costs and benefits are rare and have primarily been conducted in the US. In Australia, despite much land being prescribed burned in some parts of the country, there have been no economic evaluations of the practice.
Sound economic analyses are needed to assess the costs and benefits of prescribed burning in Australia and identify the options that provide the highest benefits to society. In an effort to increase the availability of this type of studies, we explored the application of economic analysis to wildfire management in the south-west of Western Australia (WA). Our aim was to appraise the impacts of changing the prescribed burning strategy under different scenarios and evaluate the trade-offs between prescribed burning, wildfire suppression and wildfire damages in the region.
An economic framework for evaluating prescribed-burning strategies
In order to evaluate the trade-offs between prescribed burning, wildfire suppression and wildfire damages and identify the most efficient level of prescribed burning we combined economic analysis and fire simulations. We used an economic model, similar to a benefit-cost analysis, in conjunction with the AUSTRALIS Bushfire Simulator (Kelso et al. 2015) to test different prescribed burning strategies (varying the amount of area treated). The timeframe used for the analysis was 15 years, that is, the model evaluates the annual cost and benefits of prescribed burning strategies that have been continuously implemented for at least 15 years.
To test the effects of prescribed burning, we modified the fuels in the simulator to represent different prescribed-burning rates and simulated 24,200 wildfires for each rate. In order to get a wide range of plausible simulation outputs for each prescribed-burning rate, the fires were ignited in many different locations according to a probability model of fire ignition and were simulated under different weather conditions. Five different prescribed-burning rates were tested: doing nothing (i.e. prescribed burning 0% of the landscape), prescribed burning 5% of the land managed by DPaW, 10%, 15% and 20%. The treatments were distributed across the landscape in a similar manner to DPaW’s current application of prescribed burning in the south-west. This means that the patches in the landscape with the oldest fuels were treated first. The size of the treatments and their distance from towns are also similar to DPaW’s current application. We then identified the prescribed-burning rate that minimises the sum of prescribed-burning costs, suppression costs and damages.
Prescribed burning generates substantial economic benefits
Our results show that not doing any prescribed burning for several years could be very costly for the south-west of WA. Not applying any prescribed burning in the region could result in large increases in damages and suppression expenditures (see Figure 1). In addition, the results suggest that at a 0% or at a 5% prescribed-burning rate there are substantial benefits that can be gained from increasing the amount of area prescribed burned per year in the south-west region. But when a rate of 10% or higher is applied in the long term, similar average annual benefits can be expected and increasing the level of prescribed generates (on average) small marginal returns. Our results indicate that prescribed burning may generate between AU$10 and AU$47 benefits per dollar invested every year compared to a do-nothing scenario (0% prescribed burning).
The benefits of the long-term application of prescribed burning in the south-west of WA not only stem from the average reduction in suppression costs and damages that can be expected in any one year, but also from the reduction in the variability between fire seasons. This can be clearly observed in Figure 2. This figure shows that the variability in the results for low levels of prescribed burning is substantially greater than for high levels of prescribed burning. In Figure 2, the blue boxes extend from the 25th to 75th percentiles while the lines (whiskers) indicate the full range of the results. The orange circle, which indicates the mean of the results, corresponds to the top of each column in Figure 1. If no prescribed burning is applied for long periods of time in the south-west of WA, on average we could expect a fire season to cost AU$256 million in suppression costs and damages, but this average is calculated from fire seasons that can cost anywhere between AU$5 million and AU$1.7 billion (see the full extent of the whiskers for 0% prescribed burning in Figure 2).
The 10% prescribed-burning rate shows an interesting result. Although the size of the blue box is similar to 15% and 20% prescribed-burning rates, the variability in the results for 10% is much higher. This suggests that even if a 10% prescribed-burning rate is applied in the long term, a fire season that may cost in total between AU$72 and AU$860 million in management costs and damages can be expected to occur approximately every twenty years in the region. Thus, despite substantially reducing the average cost of a fire season, the application of a 10% prescribed-burning rate still has a small risk of very bad outcomes.
The model shows that with the current prescribed-burning program that the Department of Parks and Wildlife have in place, applying the treatment to an average of 6% to 7% of their managed land in the region, they are already generating substantial benefits for society. If no prescribed burning was applied in the South West forest region, average annual suppression expenditure would be around 4 times higher than the current level and damages would be around 5 times higher. On average, the current prescribed-burning program generates AU$31 million savings per year in suppression expenditures and AU$169 savings in damages compared to a do-nothing scenario. The optimal rate obtained from our model suggests an increase in prescribed burning in the region to the levels applied in the 1960s and 1970s (about 15% of DPaW-managed land). However, increasing prescribed burning to these levels today may incur additional cost in terms of resources and other probable costs that are not accounted for in this analysis that may be high. For instance, there may be increases in health costs from smoke exposure and biodiversity losses. In addition, communities living in fire-prone areas would need to increase their acceptance of prescribed burning, recognise that it is not a risk-free activity and that there is a chance of escaped treatments, but also acknowledge that prescribed burning does not eliminate the risk entirely so there will always be a residual wildfire risk (Bradstock et al. 2012).
In today’s context in the south-west of WA, a 15% prescribed-burning rate in DPaW-managed land may be an exceptionally high level, and it may not be possible to achieve it for several reasons: climate change which narrows the window of opportunity to apply the treatment (Cary et al. 2012), the accumulation of fuels in the south-western forests of WA for the past 50 years (Boer et al. 2009), fire exclusion policies, and the expansion of the WUI (Mutch et al. 2011). This factors have all contributed to create a landscape in which the application of high rates of prescribed burning is increasingly difficult (Burrows and McCaw 2013). Nevertheless, this study emphasises the importance of keeping a minimum level of prescribed burning per year in the south-west forest region of WA.
For more information, go to www.bnhcrc.com.au/research/economics-policy-and-decision-making/1147