Addressing Industrial Air Pollution in Kazakhstan

Annex C. Illustration of a penalty calculation with a gravity component

Table A C.1. Calculations based on the BEN model

Inputs
Initial capital investment	USD 100 000
One-time, non-depreciable expenditure	USD 80 000
Annual operating and maintenance expenditure	USD 10 000
Non-compliance date	01/06/2005
Compliance date	01/12/2008
Estimated penalty payment date	30/01/2009
Discount rate	9.1%
Outputs
Present values as of non-compliance date
Capital and one-time costs in the absence of non-compliance (A)	USD 102 091
Capital and one-time costs with delayed compliance (B)	USD 88 199
Avoided annually recurring costs (C)	USD 16 453
Economic benefit as of non-compliance date (A-B+C)	USD 30 345
Final economic benefit as of the estimated penalty payment date	USD 41 769

Source: (OECD, 2009[1]).