Payments For Ecosystem Services Schemes Research Articles

Monitoring and evaluation of Payment for Forest Environmental Services in Vietnam: From myth to reality

Payments for Ecosystem Services schemes, or PES, offer a useful approach to account for the largely unrecognized value of ecosystem services provided by the forestry sector. However, the actual impacts of PES schemes, both in effectively protecting the environmental quality of an ecosystem, such as the water filtration capacity of a forest, and on improving local livelihoods, often remain unknown. Policy evaluation in general, and for newly established policies in particular, plays a critical role in providing essential feedback about what is actually happening on the ground. Thus, for PES to generate outcomes that are effective, efficient and equitable, policy makers must develop a functional evaluation system. As PES schemes around the world face similar problems in monitoring and evaluation, we draw on the case of Vietnam—the first country in Asia to introduce a nationwide PES scheme—and analyze the effectiveness of the monitoring and evaluation activities of the Payment for Forest Environmental Services program (PFES). We also offer practical policy recommendations for future PFES implementation. We find that monitoring and evaluation of PFES in Vietnam is still in its infancy. Although there is a strong accounting of revenues generated from ecosystem services buyers, there is a discernible lack of ability to assess the quantity and quality of ecosystem services being enhanced by the program; fulfillment of contractual obligations; the appropriateness of financial flows; or socio-economic impacts of the program. We argue that a functioning PES evaluation system must include an accessible grievance mechanism to ensure transparency and accountability in the distribution of PES revenues from central to local levels.

Nudging service providers and assessing service trade-offs to reduce the social inefficiencies of payments for ecosystem services schemes

Socially inefficient payment for ecosystem services (PES) schemes result when adverse shifts in the provisioning of other ecosystem services (ES) or overpayment to service providers occur. To address these inefficiencies, a holistic evaluation of trade-offs between services should be conducted in parallel with determining land owners’ service provisioning preferences. Recent evidence also suggests that nudging stakeholders’ preferences could be a useful policy design tool to address global change challenges. Forest owners’ landscape management preferences were nudged to determine the impact on the social efficiency of PES schemes for biodiversity conservation and climate change mitigation in Finland. ES indicators for biodiversity conservation, carbon storage, and the albedo effect were included with traditional provisioning services (i.e. timber) and bioenergy to assess the consequent intra-service trade-offs. Synergies in provisioning of regulating services were identified, but were found to be more efficient when the management objective is for biodiversity conservation rather than climate change regulation. Nudging led to marginal gains in service provisioning above the baseline management and above neutral owner preferences, and increased aggregate service provisioning. This demonstrates the importance of considering intra-service trade-offs and that nudging could be an important tool for designing efficient PES schemes.

Applying the social–ecological systems framework to the evaluation and design of payment for ecosystem service schemes in the Eurasian steppe

The application of payment for ecosystem services schemes to dryland areas has been limited, particularly for schemes that seek to improve the grassland upon which resource users in these landscapes depend. The high levels of climatic and resource variability, strength of informal institutions governing resource use and contested nature of resource decline are examples of defining characteristics that may challenge the application of more conventional payment for ecosystem services schemes in dryland contexts. We used a social–ecological systems framework to (i) help identify design criteria for effective and efficient payment for ecosystem services schemes in drylands under a pastoral land-use, and (ii) explore the applicability of the framework to dryland areas. Using eco-compensation schemes in the Chinese governed areas of the Eurasian steppe as a case study, we found that the framework adequately identified the need for non-equilibrium dynamics to be incorporated into scheme design. However, the framework was less able to explicitly enunciate the importance of micro-economics and cultural values for scheme viability. In contexts like the Eurasian steppe where some level of grazing may maximise the species richness of grasslands, acknowledging history of use in the resource unit subsystem component of the framework, not just the user subsystem component, would improve the framework. The explicit incorporation of contested issues into the framework is also needed, as dryland areas have a history of being misunderstood by non-dryland cultures, researchers and policymakers. We conclude that tailoring a general diagnostic tool towards the specific social–ecological attributes of the drylands under a pastoral land-use will improve the ability of payment for ecosystem services schemes to reach their conservation aims.

Risk, reward, and payments for ecosystem services: A portfolio approach to ecosystem services and forestland investment

This study examines the risks and returns associated with payments for ecosystem services (PES) for private forestland using modern portfolio theory. PES schemes for biodiversity conservation and climate change mitigation were considered. Pricing data for European carbon emissions offsets and the Finnish biodiversity conservation scheme ‘Trading in Natural Values’, and Finnish forest inventory data were used to model ex-post empirical results. The forest owner's portfolio could be comprised of either current forest management or a PES scheme with postponed harvesting; considerations for investing harvest income in equities and bonds were included. The correlation between a PES scheme's return series and timber returns was higher for the biodiversity scheme leading to relatively limited financial diversification benefits under current prices. Increasing the biodiversity conservation price level reduced this effect. For the climate scheme, removing the declining linear trend from the pricing data did not reduce the relatively greater diversification benefits. Overall these benefits were also greater on fertile forest site types than lower quality sites. These results indicate that the policy implications of designing socially efficient PES pricing include an important trade-off between increasing price risks for private landowners and decreasing marginal costs for society.

Potential of a payments for ecosystem services scheme to improve the quality of water entering the Sydney catchments

Although the Sydney Catchment Authority (SCA) largely controls the quality of water entering the Sydney catchments, it has limited jurisdiction over the majority of activities undertaken on private land, where much of the non-point source pollution originates. The current governance model reflects a traditional ‘command and control’, government-centred philosophy limiting the economic opportunities for landholders. Using six case studies from other jurisdictions we explore the potential for market-based schemes to better enable the SCA to meet its statutory objectives. A contemporary payments for watershed services scheme could better address issues of non-point pollution in more efficient and fairer ways than the present model. Under such a scheme, the SCA would rely more upon negotiated service arrangements pursuing a ‘least cost of supply’ for a defined water quality output, with the costs of these arrangements being reflected in the price of water to consumers. Funds are likely to be applied more strategically to secure water quality outcomes at the least public and private cost while maximizing the value of non-water ecological services from the same lands. These findings are relevant and can be applied to many other drinking water catchments within Australian and other jurisdictions.

Unraveling the effects of payments for ecosystem services on motivations for collective action

This paper addresses the differential impacts on decisions towards collective action in the context of payments for ecosystem services (PES) where individual and collective rewards are conditional on a minimum collective conservation level being achieved. Interactions between the different reward types, farmers' social preferences, social ties and communication are identified. A field game experiment is conducted with Andean farmers in Peru and framed around their decisions to conserve agrobiodiversity as an impure public good. The main results are that PES schemes could be effective in motivating collective action for agrobiodiversity conservation and that individual rewards are likely to be more effective and less sensitive to social factors than collective rewards. The latter might have a positive effect on conservation when they are shared within socially closely-related groups or in situations where communication and deliberation about collective action are possible.

The perceptions about payment schemes for ecosystem services: Study case of the San Miguel and Santo Tomás Ajusco community, Mexico

In this work an exercise of evaluation of different effects of the payment schemes for ecosystem services (PES) is presented, based on the analysis of the social perception because of its integrative perspective. The objective was to understand the opinions of the actors directly involved in the functioning of the federal PES program in Mexico, referred to the National Forestry Commission (as users of ecosystem services) and the forest communities (as suppliers of the services). The analysis was performed using the study case of the San Miguel and Santo Tomás Ajusco community, located in the Conservation Land of the Federal District. Eight testimony (proof) interviews were conducted with authorities and 239 structured surveys were applied to community representatives. Each of these groups was divided into two sub-groups: I) those representing authorities of the central and state offices and II) environmental workers and community members with property title deeds. From this analysis, we identified divergences and convergences among them, using four analysis criteria: program design and implementation, social, environmental and economic effects. In general terms, the authority has a positive perception of the process of PES implementing (in operation and strategy), while the community perceives positive and negative effects, due to conflicts within and outside the community, low and temporary payment, lack of knowledge and dissemination, among others. Indeed, this program encourages direct and short-term benefits, but with positive and negative effects on the environment and society, and there is also lack of conceptual rethinking and effect monitoring.

Assessing the effectiveness of payments for ecosystem services for diversifying rubber in Yunnan, China

Monoculture rubber plantations are rapidly expanding throughout Southeast Asia. The Prefecture of Xishuangbanna is characterised as both an epicenter of Chinese biodiversity and rubber production. The rapid conversion of native primary forest into rubber plantations has introduced tensions between the competing political goals to conserve biodiversity and heritage landscapes – both driving the rapidly emerging tourism industry – and economic aspirations at household and district levels. In China, decision makers discuss payments for ecosystem service schemes to resolve these tensions. As a component of the policy development process, this research project was invited to inform the political debate. Agent-based simulations revealed perverse outcomes of payments for ecosystem services, intended to encourage the conversion of monoculture rubber into agroforestry rubber. As an outcome of this modelling-based initiative, managing agencies have revised previously drafted payment schemes and reconsidered the importance of monitoring and regulatory approaches.

Effectiveness of Community Forest Management at reducing deforestation in Madagascar

Community Forest Management (CFM) is a widespread conservation approach in the tropics. It is also promoted as a means by which payment for ecosystem services schemes can be implemented. However, evidence on its performance is weak. We investigated the effectiveness of CFM at reducing deforestation from 2000 to 2010 in Madagascar. To control for factors confounding impact estimates, we used statistical matching. We also contrasted the effects of CFM by whether commercial use of forest resources is allowed or not. We cannot detect an effect, on average, of CFM compared to no CFM, even when we restricted the sample to only where information suggests effective CFM implementation on the ground. Likewise, we cannot detect an effect of CFM where commercial use of natural resources is allowed. However, we can detect a reduction in deforestation in CFM that does not permit commercial uses, compared to no CFM or CFM allowing commercial uses. Our findings suggest that CFM and commercial use of forest resources are not guarantees of forest conservation and that differentiating among types of CFM is important.

Fairly efficient, efficiently fair: Lessons from designing and testing payment schemes for ecosystem services in Asia

Payment for ecosystem services (PES) is commonly defined as a market-based environmental policy instrument to efficiently achieve ecosystem services provision. However, an increasing body of literature shows that this prescriptive conceptualization of PES cannot be easily generalized and implemented in practice, and that the commodification of ecosystem services (ES) is problematic and may lead to unfair situations for relevant PES actors. This paper synthesizes case studies in Indonesia, the Philippines and Nepal to provide empirical observations on emerging PES mechanisms in Asia. Lessons learned show that fairness and efficiency objectives must be achieved simultaneously in designing and implementing a sustainable PES scheme, especially in developing country contexts. Neither fairness nor efficiency is a primary aim but an intermediate ‘fairly efficient and efficiently fair’ PES may bridge the gap between PES theory and practice to increase sustainable ES provision and improve livelihoods.

A framework for assessing local PES proposals

PES (payment for ecosystem services) programmes require evaluation to ensure intended outcomes are realised. Although it is acknowledged that environmental consequences of PES schemes should be considered from a wider systems perspective, there is no recommendation on any evidence-based framework to support such assessment. A starting point to address this gap is that Life Cycle Assessment (LCA) offers advantages for the evaluation of local PES proposals by identifying whether an increase in ecosystem benefit from PES schemes is undermined by (1) displacement of environmental impact to another part of the agricultural product supply chain; (2) displacement of environmental impact to another impact category (environmental trade-offs); (3) indirect environmental effects within the landowners property (activity shifting); and (4) indirect environmental effects elsewhere (indirect land use change to compensate for loss of output where PES operates). However, LCA continues to remain an evolving field of science; as the analytic capability of LCA develops in terms of reducing uncertainty, including regional detail and economic and social aspects, it will further help for a more thorough assessment of land use policies such as PES schemes.

Valuing beaches to develop payment for ecosystem services schemes in Colombia’s Seaflower marine protected area

The Colombian Seaflower marine protected area (SMPA) is the largest MPA in the Caribbean. The economy of the main island, San Andres (SAI) relies on tourism. This study conducted 1793 surveys to capture information about tourists’ experience and the value they placed on SAI’s beaches. Tourists considered beaches as the main reason for choosing SAI as a destination and expressed that they would be willing to pay additional money, US$ 997,468 annually, on top of what they had already paid for their vacation to protect SAI’s beaches. The study also showed how beach erosion could negatively impact economically the tourism sector of SAI, reducing revenue by 66.6% (estimated at US$ 73 million annually). This research contributed to the first stage in the development of a payment for ecosystem services (PES) scheme to protect SAI’s beaches. The importance of beaches for SAI and the potential loss of revenue due to beach erosion create an opportunity to incentivize the private sector to invest in natural infrastructure that maintains and protects beaches. This study also informs the potential application of valuation studies for the development of innovative financing instruments, such as PES, to achieve financial sustainability for the MPA network in Colombia.

Prospects for Payments for Ecosystem Services in the Brazilian Pantanal: A Scenario Analysis

The present study investigates the prospects for a large-scale implementation of Payments for Ecosystem Services (PES) schemes in the Brazilian Pantanal wetland. Despite increasing environmental threats associated with development pressures and the growing interest of public and private organizations, no PES schemes are currently in place in the Pantanal. Through an exploratory scenario analysis, this article determines the prospects for PES in the area. The findings suggest that a large-scale implementation is unlikely, as this would require much higher levels of environmental awareness among local decision makers and low substitution rates of ecosystem services by technology. Furthermore, strong socioeconomic inequality between inhabitants of the Pantanal lowlands and wealthy farmers of the neighboring uplands means that potential suppliers of ecosystem services would face very high opportunity costs to participate in PES schemes. The research findings are also relevant to other environmentally sensitive regions experiencing rapid economic growth and weak environmental regulation.

The shared knowledge behind payment for rural ecosystem services: a case study

This paper investigates the shared knowledge held by a rural population of the ecosystem services supplied by rural landscapes and woods in the Rome Province of Italy. It is part of a wider research initiative conducted to estimate the non-use values of the same ecosystem services elicited through the contingent valuation method. Our findings demonstrate that: (i) most of the information on ecosystem services comes from a deep-seated community shared knowledge; (ii) some gaps exist between official (scientific/normative) and shared knowledge in the study site; and (iii) stated economic preferences are driven by both consequential motivations, as predicted by the standard economic model, as well as some others. Making explicit the motivational framework behind environmental economic estimates allows one to represent the socio-cultural legacy indispensable for providing a monetary value useful to inform public decision and policies. The use of this approach could contribute to the development of payment for ecosystem services schemes in rural policies affecting common goods.

How may REDD+ affect the practical, legal and institutional framework for ‘Payment for ecosystem services’ in Costa Rica?

Reducing Emissions from Deforestation and forest Degradation (REDD) in developing countries may affect domestic policies in related policy fields. Costa Rica has a well-established system of payment for ecosystem services (PES) aimed at protecting forests and biodiversity. Drawing on interviews and a review of the literature, this article examines the possible impact of domestic and external factors (REDD+ in particular) on the PES scheme in Costa Rica. The analysis builds on theories of domestic environmental policy-making, and of actor participation and interaction at international and domestic levels. The article׳s main concerns are how the legal and institutional system for PES has evolved and how REDD+ might impact this framework for PES through diffusion of international ideas and financial leverage of external actors. Domestic development interests and emerging REDD+ principles and methodologies present a combined challenge to the comprehensive view of ecosystem services inherent in PES. Nonetheless, most civil society actors in Costa Rica are strong environmental proponents and seem to remain relatively robust. The legal and institutional framework for PES is also relatively successful and, compared to most biodiversity-rich countries, Costa Rica relies more heavily on self-generated funding for conservation and sustainable use of biodiversity.

The economic valuation of nature-based tourism in the South African Kgalagadi area and implications for the Khomani San ‘bushmen’ community

The economic importance of the various attributes of dryland nature-based tourism in the Kgalagadi area is generally unknown, as is the distribution of benefits from such tourism. This study seeks to value selected attributes of nature-based tourism in the Kgalagadi area by applying the choice experiment technique and then assessing the potential for nature-based tourism to contribute to the Khomani San ‘bushmen’ livelihoods through a payment for ecosystem services scheme. The values placed on the attributes by park visitors are estimated using the conditional logit and random parameter logit models. The visitors prefer more pristine recreational opportunities, increased chances of seeing predators and disapprove of granting the local Khomani San communities access to grazing opportunities inside the Kgalagadi Transfrontier Park. Notably, the marginal willingness to pay for pristine recreational opportunities across all models ranging from R76.96 (US$9.08) to R177.08 (US$20.88) per trip depending on the type of restrictions imposed. Given that previous studies report that the Khomani San are willing to accept reasonable compensation for relevant resource-use restrictions, there is scope for a payment for ecosystem services scheme where visitors could be charged additional park entry fees sufficient to compensate the local communities to accept a restriction of natural resource use in the Kgalagadi area.

Urban Watershed Services for Improved Ecosystem Management and Risk Reduction, Assessment Methods and Policy Instruments: State of the Art

Under scenarios of increasing unplanned urban expansion, environmental degradation and hazard exposure, the vulnerability of urban populations, especially of their poorer segments, needs to be tackled through integrated economic, social and environmental solutions. Basing our analysis on the concept of ecosystem services, we suggest that urban areas would benefit from a shift in perspective towards a more regional approach, which recognizes them as one of many interconnected elements that interact at the watershed level. By integrating an ecosystem approach into the management of water-related services, urban management policies can take a first step towards fostering an improvement of the health of upstream and downstream areas of the watershed, activating environmentally sound practices which aim at guaranteeing the sustainable and cost effective supply of services. These strategies can for instance be supported by using payment schemes for ecosystem services or similar strategies, allowing for the redistribution of resources among communities in the watershed. From our analysis it results that, through the recognition of the primary role played by watershed ecosystems, cities can benefit from an enlarged set of policies, which can help strengthen the supply of essential environmental services, while reducing the vulnerability of its population and contributing to the maintenance of healthy ecosystems.

Payments for ecosystem services: durable habits, dubious nudges, and doubtful efficacy

Abstract:Payments for ecosystem services (PES) have become a popular approach to bring about improved environmental behaviors. When such programs are launched in developing countries, an additional benefit is that they are said to improve incomes for the poor. In this paper, we argue that PES schemes arenot‘market-based’. Indeed, they are not even ‘market-like’. The incentive properties said to be present in such programs are of doubtful efficacy. We suggest that PES schemes are instances of a new class of transaction – theinducing transaction– whose purpose is to make certain resource users the instruments of the desires of others. We relate the success of PES schemes to Veblenian ‘habituation’ and Peircean ‘habit breaking and habit taking’ to suggest that PES schemes face a daunting challenge if they are to bring about durable behavioral changes.

Environmental Subsidiarity as a Guiding Principle for Forestry Governance: Application to Payment for Ecosystem Services and REDD+ Architecture

This article describes and proposes the “environmental subsidiarity principle” as a guiding ethical value in forestry governance. Different trends in environmental management such as local participation, decentralization or global governance have emerged in the last two decades at the global, national and local level. This article suggests that the conscious or unconscious application of subsidiarity has been the ruling principle that has allocated the level at which tasks have been assigned to different agents. Based on this hypothesis this paper describes the principle of subsidiarity and its application to environmental policies within forest governance and proposes the “environmental subsidiarity” principle as a critical conceptual tool for sustainable resource management. The paper explains as an example how “environmental subsidiarity” is the key principle that can link payment for ecosystem services (PES) with environmental public policies and applies this principle with all its political consequences to reducing emissions from deforestation and forest degradation, and enhancing forest carbon stocks in developing countries (REDD+) architecture. It concludes by showing how the adoption of “environmental subsidiarity” as a ethical principle could help to maximize benefits to all stakeholders involved in PES schemes such as REDD+.

EL PAGO POR SERVICIOS AMBIENTALES COMO ALTERNATIVA PARA EL USO SOSTENIBLE DE LOS SERVICIOS ECOSISTÉMICOS DE LOS PÁRAMOS

<p>Los páramos proporcionan múltiples servicios ecosistémicos (SE), como la conservación de la biodiversidad, la captura de carbono, la oferta de hábitats para especies, la regulación climática y la regulación hídrica. La degradación de los páramos debido al cambio climático, pero principalmente por la intensificación de la agricultura y la ganadería en los últimos 50 años, genera la perdida de estos SE. Posiblemente, los Pagos por Servicios Ambientales (PSE) ofrecen oportunidades, pero tienen grandes limitaciones, para lograr un uso sostenible de los SE ofrecidos por los páramos por parte de comunidades locales que realizan prácticas agrícola y ganaderas en este ecosistema.</p><p><strong>Palabras claves:</strong> Páramos, Pago por servicios ambientales, Servicios ecosistémicos, Uso sostenible.</p>