The global status and trends of Payments for Ecosystem Services

Abstract

Recent decades have witnessed a considerable increase in Payments for Ecosystem Services (PES)—programmes that exchange value for land management practices intended to provide or ensure ecosystem services—with over 550 active programmes around the globe and an estimated US$36–42 billion in annual transactions. PES represent a recent policy instrument with often very different programmes operating at local, regional and national levels. Despite the growth of these programmes, comprehensive and reliable data have proven difficult to find. This Analysis provides an assessment of the trends and current status of PES mechanisms—user-financed, government-financed and compliance—across the domains of water, biodiversity, and forest and land-use carbon around the world. We report the various dimensions of growth over the past decade (number of programmes, geographical spread, dollar value) to understand better the range of PES mechanisms over time and to examine which factors have contributed to or hindered growth. Four key features stand out for scaling up PES: motivated buyers, motivated sellers, metrics and low-transaction-cost institutions. A unique dataset of over 550 programmes of Payments for Ecosystem Services (PES) worldwide, grouped into water, forest- and land-use carbon, and biodiversity programmes, is used to assess the trends and the current status of such policy instruments.