Brief 1- Economics of Ecosystem Services
Rationale
Clean and regular water supplies are among the most basic human needs, as well as being core to most industries and to food and energy security. Each year, hundreds of billions of dollars are invested in the equipment and facilities that are required to abstract, store, treat and distribute water. Such investments, however, have paid scant attention to some of the most important, and productive, components of water infrastructure: these are the ecosystems – wetlands, forests, grasslands and other natural habitats – that provide a wide array of services to maintain water supplies, uphold water quality and guard against water-related hazards such as pollution, storms, floods and droughts.
1. How to identify suitable methods for economic valuation of ecosystems?
Key concepts & skills: • ecosystem goods & services • full economic value & components • measuring economic values; market & non-market values • contributions of ecosystem goods & services to the economy • contributions of ecosystem goods & services to water-sector economics • linkages between ecosystem values, sustainable development & the MDGs • valuation as a tool for environmental management • methods & applications • criteria for choice of methods.
2. How to apply the results of valuations in decision making and communicate outcomes?
How to take action and use ecosystem values in river basin management and water decisions? Key concepts & skills: • ecosystems as water infrastructure: benefits of ecosystems for water management • approaches to integrating ecosystems into river basin management • economic costs of ecosystem degradation; the need for investment in ecosystems & for allocation of water to ecosystems • integrating economic values for ecosystems into decision making • relevance of ecosystem values to GEF projects and processes • understanding and interpreting the valuation report • incorporating results into options assessments, environmental assessments, investment analysis, etc. • developing recommendations • communicating results and recommendations; using ecosystem valuations to change ways of thinking • making ecosystem valuation standard practice in planning and decision making for development and natural resource management.
3. What are the principles of payments for ecosystem services (PES)?
How to identify suitable legal frameworks and institutional set-ups for PES? Key concepts & skills: • Economic aspects of ecosystems and links of ecosystem services and providers: How are the economics relevant to ecosystems- upstream and downstream groups, etc? • Market based incentives and practical sense components of PES programs: What are various options for payment schemes and way put together? • Institutional requirements and processes for stakeholder involvement and engagement that need to accompany these processes • The importance of good governance for PES: public participation, transparency and access to information • Practical sense components and elements of PES programs: property rights and contract issues.
4. How to enable design and implementation of valuation studies and PES schemes?
Key concepts & skills: • consolidation of the previous learning objectives • apply principles to identify key ecosystem goods and services • identify what valuation data are needed & scope of the assessment • select appropriate methods and elements
