dr camille bann, 8 june 2012
DESCRIPTION
The Role of Ecosystem Valuation in Decision Making & Policy development UNDP/GEF Main Streams of Life – Wetland PA System Strengthening for Biodiversity Conservation Programme. Dr Camille Bann, 8 June 2012 . Overview of presentation . Why value ecosystem ? Some examples - PowerPoint PPT PresentationTRANSCRIPT
THE ROLE OF ECOSYSTEM VALUATION IN DECISION MAKING & POLICY DEVELOPMENT
UNDP/GEF MAIN STREAMS OF LIFE – WETLAND PA SYSTEM STRENGTHENING FOR BIODIVERSITY
CONSERVATION PROGRAMME.
Dr Camille Bann, 8 June 2012
Overview of presentation Why value ecosystem ? Some examples Economic inputs to the project document
Why is valuation of ecosystem services important ?
Forest Trends, 2010
4
Uses of Ecosystem Valuation / Economic Analysis
Raise awareness Improve decision making (policies,
planning, projects) Requires understanding, measuring and
quantifying the trade-offs Facilitate effective management
including sustainable financing options Valuation underpins the design of eco-
compensation mechanisms such as PES
Ecosystems, PAs & ecosystem services5
Protected Areas are the cornerstone of conservation policy and provide multiple benefits’ (TEEB for Policy Makers)
PAs provide the best continuous natural habitats for ecosystems to be able to function and continue to deliver these services
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Mainstreaming ecosystem services
Understanding the provision of ecosystem services (Quantification)
Understanding the benefits to human well-being from ecosystem services (Valuation)
Creating incentives for sustainable provision of ecosystem services (Policy/Governance)
Typology of Potential Ecosystem Services
ES Type Service Benefit / outcome
Provisioning Servic
es
Food Commercial and subsistence fish and wildlife (from hunting)
Fibre/materials Fibre and construction products, e.g., reeds, wood, leather and aggregate
Water Public water supply, water for industrial and agricultural usage
Natural medicines Natural medicinesBiochemicals Biochemicals and geneticsOrnamental resources Ornamental resourcesSource of energy Energy provision e.g., hydropowerTransport Commercial use of waterways
Regulating
Services
Regulation of GHGs Carbon sequestration
Micro-climate stabilization Air qualityWater regulation Flood protectionAquifer recharge Flood protection (water supply captured under provisioning services)
Water purification and waste management Improve water quality / waste management
Cultural
Services
Spiritual, religious, cultural heritage Religious sites, archeological ruins (historical not recreational value)
Educational Education
Recreation and ecotourism Recreational fishing and hunting, birdwatching, paragliding, hiking, diving, sailing, canoeing, holiday destination (aesthetic views), archeological ruins (recreational value)
Landscape and amenity Property and land price premium
Biodiversity non-use Non-use value
Integrating Economic Valuation into Wetland Decision Making (Bann et al, 2010)
Step 1: Define issue and context
Step 2: Define the scope of the economic assessment
Step 3: Undertake valuation of ecosystem services
Step 4: Analysis of findings
Step 5: Report and dissemination
Six Steps for including ecosystem services in local/regional policy (TEEB, 2010)
1. Specify & agree the policy issue with stakeholders
2. Identify which services are most relevant
3.Define information needs and select appropriate methods
4. Have ecosystem services assessed5. Identify and appraise policy options6. Assess distributional impacts
What is the decision making context ?
Decision context Possible decision-making questions for wetlands resource management
Policy and project analysis (setting priorities; appraisal of investment projects, policies, regulations and standards)
What is the best wetland project, policy, management option? What are the costs of unsustainable use? Is there a case for conservation actions?What sectors are most dependent on wetlands?How much does the wetland contribute to the economy?How much should be spent on management?
Pricing and allocation What is the appropriate level of a user tariff / PES? What uses should water abstracted from wetlands be allocated to?
Legal damage assessment
What is the value of environmental damages? What scale of compensation for damage is justified?
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Overview of valuation methods Valuation method Ecosystem service valuedMarket prices Marketed products – timber, fishCost based approaches
Depends on existence of relevant market for the ecosystem service in question. E.g. expenditure on water filtration as proxy for value of water pollution damages
Production function approaches
Environmental services that serve as input to market products e.g. soil fertility contributions to agricultural productivity
Hedonic pricing Attributes that can be appreciated by potential buyers, e.g. PAs contribute to air quality, visual amenity, landscape
Travel cost All ecosystem services that contribute to recreational experience
Stated Preferences approaches
All
Value transfer All
Key regulating services•CBA•Sector Scenario Approach
Examples of Wetland Ecosystem Values and Economic Appraisal Approaches
Water Regulation (Flood Protection)
Context US$ / ha / year Source
Wetland (flooded Basin) in Bangladesh (14,000 ha)
50
(2010)
Thompson and Colavito (2007)
Muthurajawela Marsh Colombo Sri Lanka (3,068 ha)
1,758 Emerton & Kekulandala (2003)
Benut Mangroves, Johor Malaysia (shoreline protection)
845 Bann (1999)
Hawaii 1,022 Reported in TEEB
Water Purification and Waste Treatment
Context US$ (2010) / ha / year
Source
Wastewater treatment services provided by Jiuduansha wetlands Shanghai – a estuarine tidal flat covering 42,020 ha.
11.30 under conservation and
selective use
2.5 under partial conversion
Su and Zhang
(2007)
Industrial wastewater treatment provided by Muthurajawela Marsh - a coastal wetland covering an area of 3,068 ha in Colombo, Sri Lanka
905 Emerton & Kekulandala 2003
Domestic sewage treatment provided by Muthurajawela Marsh - a coastal wetland covering an area of 3,068 ha in Colombo, Sri Lanka
27 Emerton & Kekulandala
(2003)
The Value of Wetland Ecosystem Services
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Net Present Value ($/ha)
Scenario Analysis (Cost Benefit Analysis)of Ecosystems
3.6x3.8 x
17Sector Scenario Analysis Approach
Based on an Ecosystem Services Approach
Scenario Analysis (BAU /SEM) Recognises the importance of temporal
aspects
Cost Benefit Analysis ++ (recommends reporting of key indicators)
Analysis is at the sector level
Contribution of ecosystems of PAs to growth (Source: Marlon Flores)
Sector Scenario Analysis (SSA)
Overview of Pressures Facing Wetlands & Sectors Responsible
Pressure Example Sector Responsible
Drainage and reclamation for other uses
Agriculture, Industry, Tourism
Modification Agriculture, Industry
Inappropriate wetland use / management
Agriculture , Fisheries, Industry Water Resources, Tourism
Alteration of hydrological regime EnergyWater resources, Households
Pollution Agriculture. Industry, Water
Over-harvesting of wetland plant and animal products
Construction IndustryHouseholds
(illegal) Poaching HouseholdsDestructive harvesting practices FisheriesIntroduction of invasive alien species Fisheries Inappropriate land use activities and practices around wetlands
Forestry, Agriculture
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• employment• income trends• fiscal impacts (tax
revenues, subsidies and green taxes)
• foreign exchange (foreign investments, exports)
• access to green markets/income & innovation
• opinion polls /surveys• avoided damage costs• returns on investment• production (volume,
value)
• net revenue• productivity (return to
labor, land, capital)• changes in natural capital• equity impact on the
poor / distribution of benefits
SSA OVERVIEWSource: Marlon Flores
Value
Valuation of Ecosystem Services, Phewa Lake Nepal
Total Gross Annual value is US$ 45.41 million (US$ 104, 392/ha of the lake) 87.8% is from Tourism and Recreation 3.2% from Provisioning services (food, irrigation and
hydro)
Management of the lake is key to the Tourism Sector. About 40% international tourists or 200,000 tourists visit
Pokhara in a year Similar number of Nepali tourists also visit Foreign Exchange earning from International Tourism is
Nrs 29 billion in 2009 or 3% of GDP
Demonstrating value for money (1)In New York, Catskills (Perrot-Maitre and
Davis 2001). Payments to maintain water purification
services in the Catskills watershed (US$ 1-1.5 billion)
This is significantly less than the estimated cost of a filtration plant (US$ 6-8 billion plus US$ 300-500 million/year operating costs).
Taxpayers’ water bills went up by 9% instead of doubling
Demonstrating value for money (2) Venezuela - the national protected area
system prevents sedimentation that if left unattended could reduce farm earnings by around US$ 3.5 million/year (Pabon-Zamora et al. 2008)
Mangroves in Vietnam. Restoring & protecting nearly 12,000 hectares of mangroves cost US$ 1.1 million but saved annual expenditures on dyke maintenance of US$ 7.3 million. (Tallis et al. 2008)
Assessing the benefits of not converting a floodplain in Delhi
Around 3,250 ha of floodplain between the Yamuna River and the landmass in Delhi offer benefits such as provision of water, fodder, fisheries, and recreation.
Pressures to convert the floodplain for housing & industry,
A range of ecosystem services estimated at US$ 843/ha/year (2007 prices) (Kumar 2001),
Higher than the opportunity costs of conservation, justifying the maintenance of the floodplain.
The Delhi Government halted the embankment plan of Yamuna
The Wetlands Reserve Program, USA A voluntary program offering landowners an opportunity
to establish long-term conservation and wildlife protection in exchange for retiring eligible land from cultivation.
The USDA Natural Resources Conservation Service (NRCS) goal is to achieve the greatest wetland functions and values, along with optimum wildlife habitat, on every acre enrolled in the program.
There were 229 contracts in 1992 and 485 contracts in 2008.
Funding for the WRP program was fairly steady between 2002 and 2008, averaging roughly US$246 million per year.
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Key messages ! Wetland Protected Areas represent
natural capital If they are properly managed they provide
a flow of vital services – water, flood control and recreation
If they are badly managed these benefits are reduced or lost at an economic cost to society
Sustainable management requires the integration of ecosystem services into planning to ensure trade-offs are properly evaluated
Ecosystem services valuation underpins the design of eco-compensation mechanisms
F
Economics Component
Forest Trends, 2010
Valuation Review of existing wetland valuation studies in China
Priority gaps Evidence of value added of well functioning wetlands Evidence of rates of return investment wetland
conservation Identify successful international experiences of
internalising wetland values into national planning process
Assess potential for adopting and institutionalising existing valuation tools & methodologies by the project
Assess most cost-effective way of using economic tools under the programme and sub-projects
Wetland Valuation studies – China
Constructed wetland in Hangzhou botanical gardens, China (2008)
Jiuduansha Wetland, Shanghai – a typical estuarine tidal flat of 42,020 ha located at the junction of the Yangtze River and East China Sea
Mangroves, Dongzhai Harbour, Hainan Island Linghe Rover Estuarine wetland ecosystems Nature’s value in Qinghai Province (2010) Others?
Eco-compensation mechanisms shengtai buchang jizhi
Review China’s eco-compensation programme, existing examples of local/provincial schemes, and scheme development process
Explore opportunities for channelling eco-compensation funds in support of wetland conservation
Develop plans for establishing eco-compensation schemes in target provinces and landscape under the program for inclusion in the project document
Eco-compensation mechanisms - Review by Forest Trends, 2010
Domestically driven Geographically concentrated in the richer
coastal regions Sector focus and innovation on water
related issues Involvement of private sector has been
small but opportunities for growth exist High degree of local variation in design Benefits for Property and Equity Rights
Provincial GDP & PES/MES Programs (Forest Trends, 2010)
Overview of Programs Involving Payments and Markets for Ecosystem
Services (Forest Trends, 2010)Target Program / Policy
Water Quality & Quantity Watershed Eco-Compensation Programs;
Water Use Rights TransfersForest–related Conversion of Cropland to Forest and Grassland Program (CCFG)
Central Government / Provincial Level Forest Ecosystem Compensation Fund (FECF)
Natural Forest Protection Program ; ‘
Three-Norths’ Shelterbelts program; Beijing-Tianjin Sandstorm Source Control Program;
Forest Vegetation Restoration Fee
Soil Erosion ‘Four Wastelands’ policy
Soil Erosion Control Fees & Soil and Water Conservation Installation Compensation Payments
Yangtze River Upper watershed & Soil Conservation & Key Prevention program
Eco-Agricultural National Green & Organic Food certification System; Dalian City, Liaoning Province, Green Agriculture Support Subsidy ; Shanghai / Beijing Organic Fertilizer Subsidy ; National VAT Tax Exemption for Organic Fertilizer Use; Rural Biogas development ;Promoting Conservation Tillage
Carbon Clean Development Mechanism
Voluntary Carbon Market
China Green Fund
Emission Trading On-going piloting of SO2 and COD Emission Permit Systems & Emissions Trading
Inputs to Project Documents
Design National Level approaches of proposed policy options & economic tools for inclusion in National level-economic proposal
Design the economic component of sub-projects
Generic methodology Tailored for each site (province) based on
priorities, data etc
Data to inform economics at provincial level
Socio-economic data Current policy, legal, institutional set up (regarding
valuation, eco-compensation and financing of PAs) Scientific overview
Scientific studies of regulating services ? Current uses of wetlands Threats Qualitative description of ecosystem services Management arrangements Existing valuation studies Existing eco-compensation mechanisms and policy at
provincial level
