incremental value of K only slightly each year (as shown by curve e(t)), but 

 over many years the total gains of such enhancement 



^■■l 



C. = I re(t) - r(t) ] dt 



properly discounted, may very well exceed the unmitigated losses L. It is 

 clear that the longer enhancement can be applied, even if enhancement is very 

 slight, the more substantial the long-term benefits that accrue over time. 

 (NOTE: Unless discounted, any long-term compensation, however slight, would 

 turn out to be the best strategy for dealing with a short-term impact.) In 

 this case, the overall net benefits of compensation Be are equal to Ge - L. 

 Assuming costs of enhancement equal Ce, the benefit per unit cost of compen- 

 sation is B(;/Ce = Ec- This value can be contrasted to that of mitigation, E^, 

 to determine which strategy would be most cost-effective. 



Compensation by Protection of Threatened Habitat . 



In figure 18-1, the solid line described by the function q(t) shows that 

 change in K which would occur if nothing is done about the impending impact, and 

 p(t) describes the situation if this impact is prevented. The total gains 



I p(t) - q(t) j dt 



discounted over time, may in fact exceed long-term unmitigated losses L, in 

 which case the overall net benefits are Bp = Gp - L. Assuming costs of pre- 

 vention are Cp, the benefit per unit cost is Bp/Cp = Ep, which again may be 

 compared to corresponding values for mitigation and enhancement compensation. 



146 



