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Table 14: Summary of sensitivity testing
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| Sensitivity test |
Result |
Change in decision-making criteria* |
|---|---|---|
| Reduce discount rate to 5% |
Benefits increase to $699.5m Costs increase to $145.2 m |
NPV: $554.3 m B/C: 4.82 Cost per life saved: $232,000 |
| Increase discount rate to 15% |
Benefits decrease to $273.9 m Costs decrease to $88.7 m |
NPV: $185.2 m B/C: 3.09 Cost per life saved: $142,000 |
| No wood burner costs |
Total costs fall to $79.4 m |
NPV: $349.8 m B/C: 5.41 Cost per life saved: $127,000 |
| Triple costs to industry |
Total costs increase to $128.4 m |
NPV: $300.7 m B/C: 3.34 Cost per life saved: $206,000 |
| What would costs need to be for cost per life saved to exceed $2.5m**? |
$1.6 billion |
Costs need to be over 15 times higher for investment not be 'worthwhile' |
* NPV refers to the net present value and B/C refers to the benefit-cost ratio.
** $2.5 m refers to the Transfund level of 'acceptable' investment to avoid a fatality.
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