Challenges in incentivising ecosystem services in urban planning: Oslo's Blue-Green factor biases blue-green infrastructure design towards low-cost measures

Summary

Urban sustainability efforts increasingly rely on blue-green infrastructure (BGI) to deliver essential ecosystem services in response to climate change, urbanisation, and declining public health. However, the ecosystem service outcomes of private developers using cost-effectiveness as a paradigm to design BGI measures remains poorly understood, particularly in operational urban planning contexts. This study evaluated the cost-effectiveness of BGI measures within Oslo’s Blue-Green Factor (BGF), a planning tool that mandates minimum ecological performance requirements for new developments. We combined cost-effectiveness analysis with expert-based weighting of ecosystem services for 12 common BGI measures. Our findings demonstrate substantial heterogeneity in cost-effectiveness across BGI measures in relation to ecosystem services, driven largely by cost variation and expected lifespan. Measures with simple vegetation layers (e.g. lawns, sedums) emerged as most cost-efficient due to low implementation costs and long lifetimes but delivered limited ecosystem service benefits. In contrast, structurally complex measures, such as green walls, intensive green roofs, and rain gardens performed better in regulating air pollution, reducing runoff, and supporting biodiversity, albeit at higher costs. Sensitivity analyses revealed cost variation as the dominant factor influencing cost-effectiveness. Importantly, our cost-effectiveness analysis highlights that the current BGF framework may bias design choices towards low-cost, lower-performing BGI. To more accurately reflect ecosystem service contributions, Oslo’s BGF could benefit from revised weightings and spatially differentiated performance criteria tailored to local socio-ecological priorities. This study provides the first assessment of the BGF’s incentive effects and offers guidance for improving urban BGI planning tools.