Guidance

Air quality appraisal: impact pathways approach

Updated 16 December 2025

1. Description

This guidance page details the process for assessing the air pollution impact of a policy or project using the Impact Pathways Approach (IPA).

Using the IPA, Defra have produced air quality damage and activity costs. A detailed description of the IPA approach that is used to estimate damage costs and recommended for use in any bespoke IPA can be found in the 2025 damage cost report.

Read the assess the impact of air quality and choosing an approach guidance to determine which appraisal approach is most appropriate before using this page.

The IPA has 4 stages:

1. Estimating the change in air pollutant emissions from a policy.
2. Model the dispersion of air pollutant emissions to understand changes in ambient pollutant concentrations in different locations.
3. Estimate how those changes in concentrations affect different impact pathways using concentration response functions.
4. Value those impacts in monetary terms.

2. Step 1: estimating emission changes

Estimate the impact on emissions from the change in activity at their source. The relationship between the activity and pollution produced is known as the ‘emissions factor’. For example, an emissions factor for road traffic is the amount of pollution produced per vehicle distance travelled. 

Estimates of emissions factors are developed by the National Atmospheric Emissions Inventory (NAEI), presented in their Emissions Factor Database. 

Many of the pathways described refer to PM2.5 emissions. Convert PM10 emissions into PM2.5 emissions based on adjustment factors from the NAEI. Conversion factors for PM emissions from different sectors can be found in the ‘damage costs approach’ page.

3. Step 2: dispersion modelling

The next step estimates how changes in air pollution emissions translate into changes in concentrations. This is done through dispersion modelling using air pollutant models which often capture emissions data, meteorological data and modelling of chemical processes.

A range of dispersion models are available and specialist consultancies can provide this service. Email Defra igcb@defra.gov.uk for advice on the most appropriate choice of model.

In order to understand how many people are exposed at each concentration level, population weighting should be applied. Population data for the area impacted by your policy can be combined with the dispersion model output to calculate population-weighted concentration changes.

There are chemical interactions associated with some of these pollutants that you should account for in your dispersion modelling. In particular:

• emissions of NOx, NH3 and SO2 contribute to the formation of PM and NO2
• emissions of NOx and VOCs affect the formation of ozone (O3).

4. Step 3: assessing impact pathways

Next, assess the changes in outcomes that result from the population-weighted concentration changes estimated through the dispersion modelling step. This section sets out a summary of the methods and types of impact pathways used to estimate damage costs and recommended for use in any bespoke IPA.

For more details and information on the equations used to assess the impact pathways go to the 2025 damage cost report. These pathways include impacts on:

• public health
• the natural environment
• the economy

4.1 Concentration response functions (CRF)

Concentration response functions (CRFs) are used to estimate the impacts of air pollution. CRFs link concentration changes to consequent impacts by expressing a change in a health or non-health outcome for a given change in pollutant concentrations.

The CRFs recommended were taken from an extensive underlying literature on health effects of air pollution and follow the latest recommendations of the Committee on the Medical Effects of Air Pollution (COMEAP) and the UK Health Security Agency.

CRFs express changes in outcomes per unit change in concentration). For example, a 10µg/m3 increase in the population-weighted mean concentration of PM2.5 leads to a 9% increase in the incidence of lung cancer. A breakdown of which pathways are included for each pollutant and the CRFs used to estimate the damage costs can be found in the 2025 damage cost report.

CRFs can be provided as a relative risk (% change per 10µg/m3 change in pollutant), hazard ratio (also % change per 10µg/m3 change in pollutant) or odds ratio (change in baseline odds for 10µg/m3 change in pollutant). The use of the CRFs is different depending on whether the CRF is based on the relative risk, hazard ratio or odds ratio with details found in the 2025 damage cost report.

4.2 Health impacts

The following health impact pathways and CRFs used to estimate damage costs and recommended for use in any bespoke IPA are selected based on a combination of advice from the COMEAP and the UKHSA:

• mortality effects of long-term (or chronic) exposure
• mortality effects of short-term (or acute) exposure
• morbidity effects associated with long-term (chronic) exposure. These are ischaemic heart disease, stroke, lung cancer, asthma (in adults and children), chronic bronchitis, and T2 diabetes
• morbidity effects of short-term exposure: respiratory and cardiovascular hospital admissions

Mortality impact pathways

The mortality associated with chronic exposure pathway is a measure of all-cause mortality – this means the pathway is based on an estimate of the relationship between chronic exposure to air pollutants and premature deaths, regardless of the conditions (for example respiratory, cardiovascular) that may have preceded death. The impact of a one-year change in emissions on all-cause mortality associated with long-term exposure is calculated using life tables which simulate changes in survival rates at different ages for the UK population.

Acute mortality refers to the loss of life following short-term exposure that initiates a fatal event. For example, a person suffering with an existing respiratory condition may be more likely to experience a fatal episode in periods of particularly poor air quality. This is in contrast to the long-term effects of air pollution on human health that are captured in the mortality associated with chronic exposure pathway.

Morbidity impact pathways

The morbidity pathways address the link between air pollution and the onset of health conditions such as asthma and bronchitis, or health incidents such as respiratory hospital admissions, that are non-fatal. They lead to a reduction in the quality of life and may persist for many years. Concentration response functions for these pathways are recommended by COMEAP and UKHSA.

For most of the morbidity pathways (ischaemic heart disease, stroke, diabetes, lung cancer and asthma) concentration response functions estimate the change in incidence of conditions related to air pollution. That’s the changes to the flow of new cases (‘incidence’) rather than changes to the stock of existing cases (‘prevalence’).

The chronic bronchitis pathway is estimated using a prevalence approach, following COMEAP recommendations. Concentration response functions for hospital admissions are also based on COMEAP advice.

4.3 Environmental impacts

Air pollutants can have a range of negative impacts on the environment and ecosystems. Four environmental impact pathways are included in the IPA methodology used to estimate damage costs and recommended for use in any bespoke IPA:

• damage caused by sulphur dioxide to buildings
• damage caused by ozone to materials
• soiling of buildings due to PM
• ecosystem damages

4.4 Economic impacts

Air pollution affects the economy by reducing the ability of workers to attend the workplace and to be productive in their work. This impact is included in the IPA methodology used to estimate damage costs based on a method developed by Ricardo AEA (2014) and focuses on 2 pathways:

• absenteeism and work-days lost for employees, volunteers and carers (PM2.5)
• presenteeism and minor restricted activity days for employees (PM2.5 and O3)

4.5 Overlap of NOx and PM

Air pollutants are often emitted in mixtures. For example, road transport will typically produce emissions of both NOx and PM simultaneously. It can be difficult for epidemiological studies to isolate the health impacts of just one type of pollutant. Some measures will affect emissions of one type of pollutant more than others which we need to be aware of when using a method to estimate the damage associated with each pollutant individually.

Coefficients derived from studies that look at one pollutant only (‘single pollutant models’) may capture the effects of other pollutants and, therefore, be biased. To correct this potential bias, COMEAP (page 54, section 7.5.1) recommends a 40% reduction in the CRF associated with single pollutant NOx models This 40% adjustment factor is applied to the CRF in the NO2 mortality associated with long-term exposure and NO2 morbidity pathways.

5. Step 4: valuation

Having identified and quantified the physical impacts of unit changes in emissions of different pollutants, each of these impacts is monetised using a range of methods depending on the pathway. This section sets out a summary of the valuation techniques that are used to estimate damage costs and recommended for use in any bespoke IPA, for more details go to the 2025 damage cost report.

5.1 Mortality associated with long-term exposure

The value of life years lost due to the chronic effects of air pollution can be monetised using values estimated in a study by Chilton and others (2004). This study estimated the ‘Value of a Life Year’ (VOLY) associated with a life-year spent in good health of £27,630 and in poor health of £14,280 (2002 prices).

The value of a life year lost due to the chronic effects of air pollution obtained from this study based on life years lost being in good health and rebased in 2025 prices is £59,200.

5.2 Mortality associated with short-term exposure

Each death brought forward due to acute exposure can be assumed to incur 2 to 6 months of lost life (4 months in the central scenario) in poor health. It might be expected that deaths attributable with short-term exposure from respiratory disease occur in persons that are already ill. However, evidence suggests that for cardiovascular disease, some deaths occur in apparently healthy people (with no symptoms of prior underlying illness). To address this uncertainty, 15% of deaths attributed to short-term exposure are valued using this higher valuation in the high damage cost estimate. 

Adjusting for the above the value of a life year lost due to the acute effects of short-term exposure to air pollution is valued at £30,600 (2025 prices).

5.3 Morbidity

The core method for monetising the loss of quality of life due to health conditions is ‘Quality Adjusted Life Years’ (QALYs). This involves assigning a utility weight to different conditions: a QALY value of 1 is attached to a life year lived in perfect health and values that approach 0 indicate increasingly poor quality of life. In accordance with the Green Book the Willingness to Pay (WTP) for a QALY is £84,548 in 2025 prices.

The utility weights (QALY values) used in calculating damage costs are from Sullivan and others (2011). The product of these utility weights and the WTP for a QALY is the value given to the loss of quality of life for one year due to a particular condition. The total value of each morbidity pathway is the annual cost of lost quality of life combined with the average duration of disease.

Hospital admissions are treated differently, as they’re single events rather than a year lived with a particular condition. Research conducted by Chilton and others (2004) also asked respondents about their willingness to pay to avoid hospitalisation. These values are used in damage cost pathways and rebased to 2025 prices:

• £11,200 for a respiratory hospital admission
• £11,400 for a cardiovascular admission

5.4 Productivity

Productivity impacts of air pollution are valued following the approach in section 5 of Ricardo AEA (2014). The valuation of these health impacts uses the Human Capital Approach (HCA) to assess lost productivity. Under the HCA, productivity loss is measured as the length of potential productive time that the person is unable to work multiplied by a value of marginal productivity revealed in the market.

5.5 Material damage to buildings

Damage to building materials from SO2 Is based on repair cost data from the architecture and building sector. A full account of the methods used is provided in the reports of the European Commission-funded ExternE Project. The value is estimated, on a national average basis, at £316 per tonne of SO2 emitted (2025 prices).

Holland and others (1998) estimated that the effect of a population weighted 1ppb (parts per billion) change in ozone in the UK was £3.7m per annum (2005 prices). The price base has been updated and conversion expressed in terms of population-weighted ozone concentration to give the impact per tonne of NOx or VOC emitted via the ozone pathway.

5.6 Building soiling

Rabl and others (1998) estimated the disamenity impacts of soiling due to PM by inferring the value from expenditure on renovation of buildings in France. The values from this research are used in the damage costs and equate to £751 (2025 prices) per tonne of PM10 emissions.

5.7 Ecosystem damages

Drawing on the Jones and others (2014) study, go to the 2025 damage cost report for the valuation for different ecosystem pathways associated with key pollutants.

5.8 Sensitivities

The estimation of the impacts of air pollution on both health and non-health pathways is inherently uncertain. The methodology for assessing the different impact pathways is based on a number of assumptions around which there is a distribution of probable outcomes.

The IPA methodology has been developed based on expert recommendations, in particular from the Committee on the Medical Effects of Air Pollution (COMEAP) and attempts to estimate the impact of air pollution based on the most up to date evidence available. Users should note that the evidence base around air quality impacts is continuously developing and therefore these costs don’t necessarily account for the exhaustive list of all the potential health and non-health impacts of air pollution.

Calculate valuation across sensitivity scenarios to capture uncertainties associated with the analysis. Go to the 2025 damage cost report for a description of what inputs are adjusted in the sensitivity range used to estimate damage costs and recommended for use in any bespoke IPA.

6. Annex 1: costs per unit concentration hybrid approach

6.1 Description

Having completed steps 1 and 2 set out in this guidance, users can apply ‘costs per unit concentration’ instead of completing steps 3 and 4. For more information on this approach and the data which can be used go to the 2025 damage cost report.

In place of users undertaking steps 3 and 4 themselves, this approach uses the methodology which produces the damage costs as set out in the 2025 damage cost report. If users require changing any of the tasks set out in steps 3 and 4, they should instead produce a full IPA (for example, an IPA would be better suited when investigating impacts in areas with high levels of deprivation). Read the ‘choosing an approach’ page to help determine which appraisal approach is most appropriate.

This is considered a ‘hybrid approach’ as some pathways cannot be expressed per unit concentration and therefore must be expressed per tonne of emission, with the summed total used to produce the overall estimate.

6.2 Application

The costs are expressed per 1 µgm-3 change in population-weighted concentrations which should have been calculated by users in step 2- Dispersion modelling.

This has been done such that the impacts can easily be scaled to the relevant appraisal domain. As such the costs per unit concentration should   be multiplied by the population-weighted change in concentration, and the total population in the appraisal domain (i.e. the sum of population in the air quality modelling domain from which the population-weighted concentrations have been calculated) to estimate the total damage cost. 

Not all impact pathways are calculated based on concentration exposure. Some are carried through from underlying studies and estimations, and as such are deployed on a per tonne basis. As such, when the costs per unit concentration approach is used, analysts will also need to calculate additional ‘other impacts’ that are expressed per tonne of emissions.

The ‘direct impacts’ and ‘other impacts’ estimates can then be added together to generate the total damage estimate.