Risk analysis and management

Abstract

This chapter presents an introduction to the essentials of risk analysis, assessment, and management. The use of decision trees and payoff tables is discussed together with some criteria to reach optimum decisions. The use of additional statistical measures to the expected value is shown to provide additional insight into decision-making. Furthermore, some exposition to topics of environmental economics, such as the environmental cost of groundwater pollution, is detailed to demonstrate that viewing the cost of environmental degradation in a way that is limited to the cost of remedial actions only leads to less environmentally friendly solutions. The attitude to risk of individuals and corporations is incorporated into risk analyses using utility theory, and examples are provided in hazardous waste transportation and burial problems. An elementary exposition of the Bayesian decision theory is discussed with an example of air emissions from waste to energy facilities. The human health risk assessment for environmental hazards is discussed by detailing its elements of hazard identification, exposure assessment, toxicity assessment, and risk characterization and presenting various models of exposure assessment and risk characterization. The steps of risk management programs are described together with the role of regulatory agencies and their approaches to risk. Finally, the chapter concludes with a presentation of mitigation measures for pollution in soils.

keywords: Decision criteria; Decision trees; Hazard identification; Human health and exposure; Lost value of groundwater; Maximum expected monetary value criterion; Mitigation technologies for polluted soils; Risk tolerance; Statistical and bayesian decision theories; Utility theory