SROI for Boston's American Recovery and Reinvestment Act Investments
For the Boston Redevelopment Authority (BRA), HDR led the development and application of a sustainable return on investment (SROI) model to evaluate the sustainability benefits of federal stimulus-funded investments across multiple City departments. Sustainability impacts were measured primarily in terms of energy efficiency, water conservation and environmental effects for a range of projects, such as new solar panels, improved traffic intersections and use of LED lights, and public building renovations and modernizations. The analysis also examined near-term and long-term job creation benefits, reduced emissions and cost savings for public buildings. HDR worked with the BRA to:
- Structure the SROI model and analysis to allow Boston to evaluate the sustainability benefits of investments across each City department;
- Obtain the data inputs necessary to assess sustainability benefits, including outreach to City departments to help estimate changes in energy and water consumption, operating and maintenance costs, etc.;
- Develop and apply an SROI model to Boston's current federal stimulus-funded investments; and
- Document and communicate the sustainability results of the SROI analysis.
The economic, environmental and energy cost savings benefits of Boston's American Recovery and Reinvestment Act investments are substantial. Benefits are estimated to exceed costs by a 4.5 to 1 ratio meaning that every $1 invested produces $4.50 in total benefits, with a payback period of just 5 years. The net present value (NPV) is a positive $209 million with an internal rate of return of 38 percent.
- Professional Services: Economic Evaluation of Infrastructure Investment