Monday, February 25, 2013

TEEB and spatially-explicit ecosystem services valuation

I just read the new TEEB report on the state of the world's wetland and water ecosystem services. In case you didn't know, TEEB is The Economics of the Environment and Biodiversity. They're a group led by Pavan Sukhdev, and they're one of the leading champions of ecosystem services accounting out there right now, internationally. Geographers, for one, have had their say about TEEB here and here.

There's a lot going on in the TEEB wetlands report. Let's walk through what they're doing and why and how it might matter to the average practitioner on the ground. What the TEEB report's authors are out to do is to assess the current state of the world's wetlands in terms of the provisioning, regulation, habitat, and cultural ecosystem services they provide. Contrary to what a lot of folks expect from TEEB, there's only so much in this report on monetary valuation - that is, coming up with a price amount on services as an expression of their value (a couple of posts back when I said I'd get to value, I meant it!) Sure there are figures like Table 2.2 (pg. 10) that spell out minimum and maximum values (in International $/ha/year - Int. dollars are basically a standardized unit to account for purchasing power) for different kinds of aquatic ecosystems and different kinds of services. But the TEEB authors are at great pains to show you they recognize that the process of valuation - who participates, who benefits, etc. - matters as well.

The problem is that accounting for the process of ecosystem service valuation is difficult to do in chart form. It's hard for TEEB to keep the pricing cat from getting out of the bag, as it were, since: ignore the economic value (including monetary value) of nature is to reduce the ability to make robust arguments that have a chance of informing decisions for the conservation of important ecosystems. The use of monetary valuation in many cases enhances the social visibility of the benefits brought about by environmental protection and restoration. By doing so, it can act as a counterweight to the pressures causing environmental degradation, which are driven by economic activities where market prices do not take into account negative impacts on health and the environment (sometimes termed “externalities”). (27)

Pricing services, or, as the TEEB slogan goes, "making nature's values visible," means that governmental and corporate decision-makers will and thus stop environmental degradation. They might even promote protection and restoration if they can see the economic benefits of doing so. And so that's why in Table 2.2 we see that, for instance, the value of the regulating services of inland wetlands is somewhere between 321 and 23,018 Int.$/ha/year.

But what are nature's values? Value is something you hear a lot when you're dealing with ecosystem services. For now, I'll offer the following simple definition, and hope you'll come to agree with it: value is the contextual opportunity or constraint to service provision. Ecosystem services and their values are relative, depending on where you are and where you look. The authors of the TEEB report realize this. They write, "Ecosystem functions, the flow of ecosystem services, and the economic value to society and the economy are site specific ...." (TEEB 2013, 08)

Likewise, leading ecosystem services advocate Gretchen Daily said in a recent interview: "We need to be able to pinpoint places on the landscape or on the seascape and say these places are really the most important for supplying these benefits, and if we were to invest in protecting them, we would get this return on the investment."

Lest you think value is an esoteric exercise left to the preserve of global pundits, note that state environmental agencies in the US are considered with ecosystem value as well. The word itself is in many statutes, and here's how Oregon's Department of State Lands, for one, sees it: “[Value is] the importance or worth of a wetland function to societal needs. This includes public attitudes and the wetland’s opportunity to provide a given function based on its location.” Again, value means opportunity to provide a function, and this opportunity is spatial in nature.

Value as opportunity isn't some abstract notion, existing only in the minds of ecosystem services advocates and state environmental regulators. It's getting put into practice. The Natural Capital Project is a global coalition of academics out to valorize services. In particular, they're interested in the spatiality of services. They've come up with this serivcesheds idea (see the figure to the right). The idea is to help people conceptualize where nature's benefits come from. So, as the diagram shows, the benefits of carbon sequestration apparently come from and benefit everyone globally. But clean water for fish is a much more specific value, dependent on people's recreational demands.

What I'm bring this all back to is this: At the same time we see a drive by the Natural Capital Project and some environmental agencies to name value as dependent on where the services are in relation to where the beneficiaries are, we have the TEEB report. TEEB calculates global values. But how can you have one global value for wetlands, when wetland values are always in the eye of the beholder? These global values do just sum up local contextual values, but what good do they do an individual policy-maker? What does it mean that  the value of the regulating services of all inland wetlands is somewhere between 321 and 23,018 Int.$/ha/year? Even US President Obama can take little action to save, in one fell swoop, all the world's freshwater wetlands and their regulating values, much less all the world's wetlands and all their values. Maybe he can save a couple wetlands, say outside of his city, Chicago, but TEEB's numbers don't tell him much about the importance of saving those specific ones. Likewise, for an environmental regulator in say Oregon, TEEB's numbers tell them relatively little about the wetland down the street and its worth. So which way do you think we should we have it - global values a la TEEB, or site specific ones like from the Natural Capital Project?

I'm not sure myself; there's uses to both. Right now, I want to briefly hint that there is a potentially serious discrepancy between local and global values when it comes to climate change in particular. The value of a coastal wetland in New York providing services like water storage and delay that buffer climate impacts like sea level rise is a local value. That local value is only a value because of a global problem. If climate change weren't a threat to New York, there wouldn't necessarily be any value for that wetland to be there. Moreover, the value of a forest sequestration project may be more global than it is local because carbon sequestration benefits everyone.

In the next post, I'll write more about climate change and ecosystem services. Climate change is so often seen as a temporal problem - it will cause ecosystem services to be less "resilient" over time because of extreme events. But it will also raise some serious spatial scale dilemmas.

Figure from "Servicesheds." The Natural Capital Project.