Upstream resource managers preferences to improve water-related ecosystem services (WES) in the Lake Naivasha basin, Kenya

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1 Upstream resource managers preferences to improve water-related ecosystem services (WES) in the Lake Naivasha basin, Kenya Dawit W. Mulatu, A. van der Veen & Pieter R. Van Oel ITC-Faculty of Geo-Information Science and Earth Observation University of Twente, The Netherlands. ACES and Ecosystem Markets 2012 Conference December 10-14, 2012 Marriott Harbor Beach Hotel, Ft. Lauderdale, FL, USA 12/20/2012 1

2 Outline Introduction Research Conceptual Framework Data Source and Methods The Choice Attributes and Level Sample Choice Set Results Conclusion 12/20/2012 2

3 Introduction Limited research work related to economic valuation studies on the preferences of ecosystem service providers ( sellers ) in PES programs, particularly in Africa. Preferences of upstream resource managers to improve WES Individual choices (Action as an individual) Collective choice (Action as a community) Estimate the minimum willingness to accept (WTA) compensation to improve WES Lake Naivasha Basin, Kenya Ramsar site being a wetland of international importance 12/20/2012 3

4 12/20/2012 4

5 Research Conceptual Framework Willingness to Accept (WTA) compensation to improve ecosystem services Upstream communities as ecosystem services provider Upstream Land use and cover change Economic structure of Upstream Willingness to pay (WTP) for ecosystem services improvement P E S P A Y M E N T F L O W E S F L O W Downstream communities as beneficiaries of ecosystem services Water quality and availability for downstream Improvement in species diversity and richness (Biodiversity) Fishery population and habitat improvement Ecosystem services Downstream land use and land cover Population Employment Livelihoods Income and production Economic structure of downstream 12/20/2012 5

6 Study Area: Kenya, Lake Naivasha Basin, and Four sample WRUAs and Sample Households/respondents 6

7 Data Source and Methods The choice experiment (CE) method was applied The choice experiment was carried out (April and May FGD and Household Survey) A stratified and multi-stage random sampling to select sample WRUAs, major river areas; areas where PWES implemented and not; then followed by sample farm households Sample households were selected using random sampling techniques, Choice sets were constructed using a cyclical and fractional factorial main effect design principle (using an orthogonal design principle) to obtain a smaller number of replicates (16 choice set ) A farm household survey data of 205 local farmers with 8 choice sets were collected through choice experiments, (205* 8=4920 observations) A Mixed Logit (MXL) model employed using STATA

8 The Choice Attribute and Level 1. Riparian land and floodplain area restoration (Action as Individual) To commit from their land/plot with optimal width of 0.5meter/Row Current status/status-quo 1 row Proposed Level: 3 rows 5 rows & 6 rows 12/20/2012 8

9 The Choice Attribute and Level 2. Apply environment-friendly and conservation agriculture (CA) farming practices in farming plot/acres (Action as Individual) Current status/status-quo 0.5 Acres (1 Acres=0.405 Ha) Proposed Level: 0.75 Acres 1 Acres & 2 Acres 12/20/2012 9

10 The Choice Attribute and Level 3. Reforestation of degraded forest /Hectare (Action as a community) Current status/status-quo 0 Hectare Proposed Level: 5 Hectare 8 Hectare & 10 Hectare 12/20/

11 The Choice Attribute and Level 4. Compensation value in Kenyan Shillings (KES) /YEAR Current status/status-quo KES 1400 Proposed Level: KES 2400 KES 3400 KES 5000 KES /20/

12 Sample Choice Set Ecosystem Attributes Choice 1 Choice 2 Restoration of the riparian land and flood plain areas on your plot 5 Rows/plot 6 Rows/plot Apply environmental-friendly and conservation agricultural practices on your plot 0.75 Acres 1 Acres Reforestation of the degraded forest area 10 Hectare 5 Hectare Compensation per Kenyan Shillings (KEH) / year KEH 2400 KEH 3400 Choice 1 Choice 2 Neither/Status-quo

13 Results Results of the Mixed logit (MXL) model Estimation Variables PWES implemented PWES not implemented areas All Samples Mean Parameters Choice1_ASC *** (0.3079, 0.000) 1.571** (0.467, 0.001) 1.479*** (0.242, 0.000) Choice2_ASC *** (0.3208, 0.000) 1.563** (0.635, 0.014) 1.685*** (0.268, 0.000) Reward/Comp *** ( ,0.000) *** ( , 0.000) *** ( , 0.000) Riparian land (0.0390, 0.422) (0.085, 0.259) (0.028, 0.339) Environment-friendly *** (0.1750, 0.000) ** (0.507, 0.005) *** (0.1164, 0.000) Reforestation (0.0278, 0.232) ** (0.058, 0.001) ** (0.0252, 0.001) Number of respondents Number of Obs. LR Chi2(3) Log likelihood Prob > chi /20/

14 Results The Marginal willingness to accept (MWTA) compensation to improve WES (MXL Estimates) Water-related ecosystem PWES implemented PWES not implemented All sample Households Service attributes WRUAs WRUAs Riparian Land KES/Year KES/Year KES/Year (304.05, 0429) (449.57; 0.218) (215.39; 0.346) Enviro. Friendly 15, KES/Year ** 9, KES/Year *** 11, KES/Year *** ( ; 0.001) ( ; 0.000) ( ; 0.000) Reforestation KES/Year KES/Year* * KES /Year ** (225.97; 0.244) (427.01; 0.027) (196.98; 0.001) Significant at * 10%, ** 5% and ***1%. SD and p-value are in italics 14

15 Results MWTA compensation for selected variables of the upstream resource managers Income level Female-headed Vs Male Headed Net sellers of agricultural output Vs Net-buyers of Agricultural output land size per capita land holding PWES program participants Vs Non participants Access to NRM information/advice Practice of planting trees on their plot/farm 12/20/

16 Results MWTA compensation for selected variables of the upstream resource managers Selected binary variables Reforestation Environment-friendly Female-headed farm households ** (0.022) (0.110) Male-headed farm households ** (0.027) 14,135.23*** (0.000) PWES program participants (0.486) 13,320.65** (0.001) Non participants in PWES program ** (0.007) 11,363.74** (0.001) Farm households their land per capita is greater than the mean/average land per capita *(0.057) 6, (0.135) Farm households their land per capita is less than the average land per capita ** (0.014) 12,709.39***(0.000) Net sellers of Agricultural Production ** (0.012) 20,818.71** (0.002) Net buyers of Agricultural Production * (0.096) ** (0.012) 12/20/

17 Conclusion This study explores the potential for the development of WES in rural communities in the Lake Naivasha basin, Kenya. Environment-friendly agricultural practices and reforestation of degraded forest are major attributes to improve water-related ecosystem service. This study finds evidence to support a significant difference in MWTA values between individual choice attributes and collective (community) choice attributes in WES interventions. This study recommended that the PWES program has to be implemented in line with the upstream resource managers preferences and values in order to achieve sustainable and downstream friendly ways of managing natural resources and the environment. 12/20/

18 Acknowledgement EOIA-Lake Naivasha Kenya Wildlife Services (KWS) Lake Naivasha Growers Group (LNGG) Lake Naivasha Riparian Association (LNRA) Ministry of Water and Irrigation Regional Centre of Mapping of Resources for Development (RCMRD) Rural Focus Shell UNESCO-HELP United Nations University-INWEH University of Egerton University of Leicester Water Resources Management Authority (WRMA) World Agroforestry Centre WWF Kenya 12/20/

19 Asante Sana 19