Using payments for environmental services (PES) to assist in watershed management.

Abstract

AbstractThis chapter briefly reviews the logic behind payments for environmental services (PES) and examines the potential for using a PES programme to address environmental and poverty concerns in the Manupali watershed in the Philippines. It is indicated that PES is not a universal solution to environmental problems. It is well suited to situations in which identifiable land uses produce substantial positive externalities, and where the characteristics of service users and service providers are such that payment programmes have limited transaction costs. For these reasons, expecting PES to solve all of Manupali's problems would not be realistic. However, there appears to be clear potential to use both water payments and carbon payments to encourage improved land uses, in at least part of the watershed. Water payments would probably focus on high-erosion parts of the watershed, while carbon payments would focus on low-opportunity parts of the watershed.