Payments for Ecosystem Services: What role for a green economy?

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1 Payments for Ecosystem Services: What role for a green economy? United Nations, Geneva 4 5 July 2011 PES in the Mediterranean region: experiences from NEWFOREX and SylvaMED projects Irina Prokofieva (CTFC)

2 Mediterranean forests: facts and figures 73 million ha (8,5% of region s land area) BIODIVERSITY 25,000 species of vascular plants (50% are endemic species) and a high degree of tree richness and endemism (290 indigenous tree species with 201 endemics) WATER 60% of the water-poor-countries (with < 1,000 m3/capita*year) of the world are in the Mediterranean region NON-WOOD FOREST PRODUCTS E.g. cork, pine kernels, mushrooms, medicinal plants ENVIRONMENTAL SERVICES E.g. soil protection, recreation opportunities, carbon sequestration

3 Mediterranean forests: values Figure 1. Value per hectare of different forest goods and services. (Merlo & Croitoru, 2005)

4 Mediterranean forests: problems High non-market value not captured by landholders/-tenants Northern Mediterranean Southern Mediterranean Land abandonment Forest cover increase Lack of forest management Forest fire risk Land use change Unsustainable forest use Deforestation Desertification PES as a possible solution for the Mediterranean forests: Reward landholders for the provision and maintenance of forest ecosystem services Encourage sustainable forest use

5 Policy brief: «PES: a real solution for Mediterranean forests?» Objective: Develop a method for selecting and designing market-based mechanisms based on the type of externality, its value, its provision cost and the relevant stakeholders. Case studies: Atlantic case (DK), Boreal case (FI), Central European case (PL), Mediterranean case (SP), Mountainous case (IT), Tropical case (BR) Further information: Objective: Facilitate innovative integration of forest goods and services into regional policies by demonstrating the potential of payments for environmental services and marketbased instruments for the sustainable development of Mediterranean rural communities Case studies: Spain (Catalonia), France (Languedoc-Roussillon, PACA), Italy (Liguria region), Slovenia, Greece (Crete) Pilot projects: mushrooms (Catalonia; LR), water (Catalonia, PACA, Liguria, Slovenia), honey (Slovenia, Crete), chestnuts (Slovenia), social uses of forests (LR, Slovenia, Crete), nature protection (Slovenia)

6 PES cases Ecosystem services Recreation Biodiversity Water Forest fires Examples Fungo di Borgotaro (Italy) Adventure parks (Spain, Italy, France) Mature Forest Reserves (Spain) Land Stewardship (Spain) Adoption of singular trees (Spain) Compensation for water purification service (Italy) Forest Defense Groups (Spain) Payments for forest fire prevention (France)

7 Land Stewardship (Spain) Biodiversity, recreation Land Stewardship Network (2003) 163 individual and institutional members Providers: Private and public landowners Over 629 agreements (2009) Mechanisms: Land purchase, land management, land use Public-private financing: public subsidies, private donations, membership fees ( /y) Payment: mainly in-kind (voluntary work) Start-up cost: Annual budget: approx. 1.5M More information:

8 Mature Forest Reserves (Spain) Biodiversity Province of Girona (Catalonia) Conservation of mature forest stands (> y.o.) natural evolution Providers: private and public landholders Mechanism: compensation for lost profit Public-private financing: public subsidies, private foundation (Caixa Catalunya Social Projects) Payment: cash transfer Contract duration: 30 years 27 contracts with municipalities, 21 contracts with private forest owners (2010) Protected area: 700 ha Start-up cost: Annual budget:

9 «Fungo di Borgotaro» system (Italy) Forest conservation and management Borgotaro area in the Apennines Re-investment of proceeds from wild mushroom permits in forest maintenance Providers: community forest owners Financing: user fee sale of mushroom picking permits (6-15 /day) Payment: cash transfer, differentiated according to productivity of the area, length of picking season, etc. Payment amount: /ha/year Total number of permits: (2005) Annual revenue from permits: (2005) More information:

10 Compensation for water purification service (Italy) Water, erosion prevention Legge Galli (art. 24) Piedmont region, Emilia-Romagna region Part of the water tariff re-invested for forest improvements within the catchment area Provider: Mountain Communities (consortia of municipalities in the mountain areas) Financing: water tariff collected by public water authorities Payment: cash transfer Payment amount: Piedmont region 3-8% of water tariff income; Emilia-Romagna region 6% of water tariff income

11 Payments for forest fire prevention and water protection (France) Water, forest fire prevention Massif des Maures Water provider pays for maintaining fuel break network, limiting the risk of wildfires, which can have negative impact on dam siltation and water quality Provider: forest managed by the Office National Forests Financing: Union for the drinkable water distributin of the Corniche des Maures (SIDECM) Agreement: 4 years Study was conducted to assess the risks in case of fire The artificial lake of La Môle in a fully forested watershed dominated by cork oak, supplying water to the tourist town of Saint-Tropez, Var, France. Photo by C. Birot

12 Conclusions In most Med-countries PES schemes are still in their infancy, and there are few evaluation studies of their performance Strong private interest underlies successfully functioning PES schemes Pulling public and private interests is key for sustainable financing of PES schemes Financial sustainability must be ensured (e.g. economic crisis, political priorities) Novel financing approaches (e.g. Fungo di Borgotaro system, Adventure parks) Reinforcing demand through informational campaigns Government support to bottom-up initiatives is crucial (e.g. Land stewardship) Coordinated action among different initiatives may improve ecological effectiveness