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Payment for Ecosystem Services
Alluvial forest on the Tisza River in Hungary.
© Klaus-Henning GROTH
WWF is leading the development and implementation of an innovative approach to sustainable financing for conservation known as Payment for Environmental Services, or PES. Environmental (or Ecosystem) Services are the multiple benefits that people receive from nature, such as water purification and flood control by wetlands. PES schemes reward those whose lands provide these services, with subsidies or market payments from those who benefit.
This could mean, for example, that downstream users of water purified by an upstream forest, such as bottling companies or local residents, pay those who manage these upstream forests to ensure a sustainable flow of this service.
© WWF-Canon / St�fane MAURIS
Arranging payments for the benefits provided by forests, coral reefs and other natural ecosystems is a way to recognize their value and ensure that these benefits continue well beyond present generations. It encourages landowners to manage resources in a manner that ensures they continue to generate the environmental services. In addition to benefiting biodiversity, such schemes also have a potential to benefit poor landowners who manage these environmental services.
PES schemes require three steps
- First, an assessment of the range of ecosystem services that flow from a particular area, and who they benefit.
- Second, an estimate of the economic value of these benefits to the different groups of people.
- And third, a policy, subsidy, or market to capture this value and reward landowners for conserving the source of the ecosystem services.
WWF is working with a range of partners on all three of these steps. On assessing ecosystem services and flows, WWF has launched The Natural Capital Project, a unique partnership with Stanford University and The Nature Conservancy. The project aims to map the flows and values of ecosystem services within priority ecoregions, so conservation can target "win-win areas" of importance to both biodiversity and human welfare.
On policies and payment mechanisms, WWF is working with local, national and international partners to build policies and create markets for ecosystem services. Partners at the international level include CARE and IIED. WWF also has been building on-the-ground projects with local partners for several years, including in Guatemala's Sierra de las Minas, Tanzania, the Danube River Basin and many more.
One of the most advanced PES scheme to date has been developed on the island of Lombok, Indonesia, where WWF is working to conserve the forests of Mt. Rinjani. The forests here are vital to the $50 million per year agricultural sector of the region, and supply domestic water worth $14 million. They also bring tourist dollars into the economy, as well as water for local industry. A WWF study indicated that nearly all 43 thousand households in the area would agree to pay up to US$0.60 per month in special charges. The idea behind the PES scheme is that the funds collected will help pay for conserving the watershed forests at the head of the Segara River and improving social conditions in neighbouring communities.
PES schemes bring great hope for sustaining the protection and management of many forests for the benefit of people and for nature. In particular, PES schemes help mobilize sustainable financing for conservation, including the management of protected areas.
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"Ecosystems like forests support our lives in 50 different ways...when we don't place any value on them it makes it too easy to cut them down."
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