This paper argues that cost–benefit analysis (CBA) helps inform decisions about projects, such as whether to proceed with a project or not, which project option to select, and what refinements can be made to improve project design – thus making them more effective. It also argues that CBA can also help to assess and incorporate the risk and uncertainty of climate variability and climate change into project decision making. The most effective, it says that CBA should be included as a key component of the project cycle right from the beginning, involving multidisciplinary teams, and support from an experienced economist.