an economic assessment of uk ecosystem services bateman's presentation... · uk ecosystem...

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An Economic Assessment of UK Ecosystem Services Contributing authors (and institutions): Barnaby Andrews (CSERGE, UEA), Viviana Asara (Cambridge), Tom Askew (Cambridge), Uzma Aslam (Leeds), Giles Atkinson (LSE), Ian Bateman (CSERGE, UEA), Nicola Beaumont (PML), Nesha BeharryBorg (Leeds), Katherine Bolt (RSPB), Murray Collins (LSE), Emma Comerford (RSPB), Amii Darnell (CSERGE, UEA), Carlo Fezzi (CSERGE, UEA), Nick Hanley (Stirling), Caroline Hattam (PML), Andreas Kontoleon (Cambridge), George MacKerron (LSE), David Maddison (Birmingham), Stephen Mangi (PML), Dominic Moran (SAC), Paul Morling (RSPB), Joe Morris, (Cranfield), Susana Mourato (LSE), Unai Pascual (Cambridge), Grischa Perino (UEA), Antara Sen (CSERGE, UEA), Daan van Soest (Tilburg & VU), Mette Termansen (Leeds), Dugald Tinch (Stirling), Gregory Valatin (Forestry Research). Advisory Board: Sir Partha Dasgupta (Cambridge), Brendan Fisher (Princeton, USA), KarlGöran Mäler, (Beijer Institute, Sweden), Steve Polasky (Minnesota, USA & Beijer Institute, Sweden), Kerry Turner (CSERGE, UEA). Ian Bateman CSERGE, UEA and Head of NEA Economics Presentation to the Norfolk Biodiversity Forum Abbey Conference Centre, Carrow, Norwich NR1 2DD Wednesday, 6 October 2010

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Page 1: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

An Economic Assessment of  UK Ecosystem Services 

Contributing authors (and institutions):Barnaby Andrews (CSERGE, UEA), Viviana

Asara

(Cambridge), Tom Askew (Cambridge), Uzma

Aslam

(Leeds), Giles Atkinson (LSE), Ian Bateman (CSERGE, UEA), Nicola

Beaumont (PML), Nesha

Beharry‐

Borg (Leeds), Katherine Bolt (RSPB), Murray Collins (LSE), Emma Comerford

(RSPB), Amii

Darnell 

(CSERGE, UEA), Carlo Fezzi

(CSERGE, UEA), Nick Hanley (Stirling), Caroline Hattam

(PML), Andreas 

Kontoleon

(Cambridge), George MacKerron

(LSE), David Maddison

(Birmingham), Stephen Mangi

(PML), Dominic Moran (SAC), Paul Morling

(RSPB), Joe Morris, (Cranfield), Susana Mourato

(LSE), 

Unai

Pascual

(Cambridge), Grischa

Perino

(UEA), Antara

Sen

(CSERGE, UEA), Daan

van Soest

(Tilburg 

& VU), Mette

Termansen

(Leeds), Dugald

Tinch

(Stirling), Gregory Valatin

(Forestry Research). 

Advisory Board: Sir Partha

Dasgupta

(Cambridge), Brendan Fisher (Princeton, USA), Karl‐Göran

Mäler, (Beijer

Institute, Sweden), Steve Polasky

(Minnesota, USA & Beijer

Institute, Sweden), Kerry Turner (CSERGE, 

UEA). 

Ian Bateman CSERGE, UEA and Head of NEA Economics

Presentation to the Norfolk Biodiversity Forum

Abbey Conference Centre,  Carrow, Norwich NR1 2DDWednesday, 6 October 2010

Page 2: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Primary production

Decomposition

Soil formation

Nutrient cycling

Water cycling

Weathering

Climate regulation 

Pollination 

Evolutionary processes 

Ecological interactions 

Primary & intermediate processes

Physical and chemical inputs

Regulating

Supporting

Provisioning

Cultural

Millennium 

Assessment 

categories

From ecosystem services to their value

Ecosystem services

(what??!!)

Page 3: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Primary production

Decomposition

Soil formation

Nutrient cycling

Water cycling

Weathering

Climate regulation 

Pollination 

Evolutionary processes 

Ecological interactions 

Crops, livestock, fish

Water availability

Trees

Peat

Wild species diversity

Final ecosystem services

Primary & intermediate processes

Physical and chemical inputs

Natural enemies

Detoxification

Local climate 

Waste breakdown

Purified water

Stabilising vegetation  

Meaningful places  

Wild species diversity 

Regulating

Supporting

Provisioning

Cultural

Millennium 

Assessment 

categories

From ecosystem services to their value

Page 4: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Primary production

Decomposition

Soil formation

Nutrient cycling

Water cycling

Weathering

Climate regulation 

Pollination 

Evolutionary processes 

Ecological interactions 

Crops, livestock, fish

Water availability

Trees

Peat

Wild species diversity

Drinking waterFood

Fibre

Energy

Equable climate

Final ecosystem services Goods

Primary & intermediate processes

Physical and chemical inputs Other capitalinputs

Natural enemies

Detoxification

Local climate 

Waste breakdown

Purified water

Stabilising vegetation  

Meaningful places  

Wild species diversity 

Flood control

Natural medicine

Pollution control

Disease control

Good health

Recreation

Regulating

Supporting

Provisioning

Cultural

Millennium 

Assessment 

categories

From ecosystem services to their value

Page 5: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Primary production

Decomposition

Soil formation

Nutrient cycling

Water cycling

Weathering

Climate regulation 

Pollination 

Evolutionary processes 

Ecological interactions 

Crops, livestock, fish

Water availability

Trees

Peat

Wild species diversity

Drinking waterFood

Fibre

Energy

Equable climate

££££££££££££££

Final ecosystem services Goods

Value of goods...

Primary & intermediate processes

Physical and chemical inputs Other capitalinputs

Natural enemies

Detoxification

Local climate 

Waste breakdown

Purified water

Stabilising vegetation  

Meaningful places  

Wild species diversity 

Flood control

Natural medicine

Pollution control

Disease control

Good health

Recreation

Regulating

Supporting

Provisioning

Cultural

Millennium 

Assessment 

categories

From ecosystem services to their value

Page 6: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Primary production

Decomposition

Soil formation

Nutrient cycling

Water cycling

Weathering

Climate regulation 

Pollination 

Evolutionary processes 

Ecological interactions 

Crops, livestock, fish

Water availability

Trees

Peat

Wild species diversity

Drinking waterFood

Fibre

Energy

Equable climate

££££££££££££££

££££££££££££££

Final ecosystem services Goods

Value of goods...

..of which ES value

Primary & intermediate processes

Physical and chemical inputs Other capitalinputs

Natural enemies

Detoxification

Local climate 

Waste breakdown

Purified water

Stabilising vegetation  

Meaningful places  

Wild species diversity 

Flood control

Natural medicine

Pollution control

Disease control

Good health

Recreation

Regulating

Supporting

Provisioning

Cultural

Millennium 

Assessment 

categories

From ecosystem services to their value

Page 7: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

ES contribution to well-being

Non- monetised

Primary production

Decomposition

Soil formation

Nutrient cycling

Water cycling

Weathering

Climate regulation 

Pollination 

Evolutionary processes 

Ecological interactions 

Crops, livestock, fish

Water availability

Trees

Peat

Wild species diversity

Drinking waterFood

Fibre

Energy

Equable climate

££££££££££££££

££££££££££££££

Final ecosystem services Goods

Value of goods...

..of which ES value

Primary & intermediate processes

Physical and chemical inputs Other capitalinputs

Natural enemies

Detoxification

Local climate 

Waste breakdown

Purified water

Stabilising vegetation  

Meaningful places  

Wild species diversity 

Flood control

Natural medicine

Pollution control

Disease control

Good health

Recreation

☺☺☺☺☺☺☺☺☺☺☺☺☺☺☺

Regulating

Supporting

Provisioning

Cultural

Millennium 

Assessment 

categories

From ecosystem services to their value

+

Page 8: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

NEA Economic methodology

• Avoid ‘Total Value of Ecosystem Services’ approach:  

o Of no policy use

o Wrong (total value of ecosystem = infinity)o The approach takes the value of a single unit 

(the ‘marginal value’) of ecosystem service and  multiplies by the total number of units

o But as the number of units decreases so their  marginal value increases

Page 9: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

NEA Economic methodology

• Estimate marginal values• Apply to valuing the changes in service levels 

generated by feasible policies or scenarios. • For example:  o Likely climate change and its impactso Planting new woodlandso Changes in agricultural land use o NEA Scenarioso etc

Page 10: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

NEA Economics: Work to date

Habitat ('000 ha) England Scotland Wales NI UKCoastal Margins 194 85 49 7 339Enclosed Farmland 8030 1779 879 794 11519Freshwater 59 144 9 58 271Marine 2132 3909 733 327 66653MMH 554 3202 175 159 4106SNG 1589 1448 604 279 3934Urban 1382 152 87 48 1672Woodland 1398 1125 305 78 2911

Page 11: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Habitat/service type Goods assessedFreshwater, wetlands 

& flood plainsProvisioning; regulating; cultural. 

Enclosed farmland Provisioning; biodiversity (farmland bird diversity); 

greenhouse gas emissions; carbon storage

WoodlandsTimber production; fuel; deer stalking; venison; carbon 

storageSemi‐natural 

grasslandsProvisioning; pollination; carbon storage; water quality 

and quantity; water flow regulation. Mountains, moors and 

heathlandsLivestock; game; peat (fertilizer); drinking water; natural 

hazard mitigation; pollution remediationMarine and coastal 

marginsCarbon storage; disturbance prevention; coastal 

defence; fisheries and food; raw materials

Urbanaccess to urban parks; size of urban parks;  urban 

greenspace availability; access to greenbelt. 

Cultural ServicesAmenity value of nature; education and ecological 

knowledge; non‐use value; health; well‐beingRecreation  Number & distribution of visits; value of visitsClimate amenity Amenity value of the climate

BiodiversitySpecies conservation (e.g. bird diversity) for use and  

non‐use (existence) value; pollination; bioprospecting. 

Page 12: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Analysed data on visit outset  and destination locations. 

Visits are a function of:

Outdoor Recreation

• Site characteristics & accessibility • Substitute characteristics & accessibility•

Complement characteristics & accessibility

Population distribution•

Socioeconomics & demographics

Page 13: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Outdoor RecreationAnalysis generates location 

sensitive recreation values

Page 14: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

NEA Final Phase (to end of 2010)

• Review and revise• Complete the analysis

o Address commonalities and overlapso Focus broadens from habitats to goodso Marginal values

o Per hectare valueso Value functions

• Feed into NEA Scenario analysis

Page 15: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Economic methodology: Limitations

• If feasible changes are substantial enough then  the marginal values will begin to alter

• This links the value of service ‘flows’

to the size  of the ‘stock’

of ecosystem assets they are 

provided by:  o E.g. the value of each tonne of fish landed will 

rise as the stock of fish falls. • Need to adjust marginal values for this (tricky –

but attempting with a fisheries case study)• Alternative: Asset check (Defra project)

Page 16: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Economic methodology: Limitations

• While most ecosystem services can be valued in  economic terms, some are problematic

• While in principle we can estimate the use

value of  biodiversity 

(e.g. 

pollination 

services, 

bird‐

watching, 

etc.), 

the 

non‐use

existence 

value 

of  conservation is more difficult to assess.

o E.g. Non‐birdwatchers value for preserving bird  species which don’t contribute to provisioning

• Here I argue for an ecological limits approach with  economics confined to identifying cost‐effective 

methods of ensuring safe minimum standards  (which may be above present levels). 

Page 17: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Decision making problem:

While 

in 

principle 

we 

can 

estimate 

the 

use

value 

of  biodiversity 

(e.g. 

pollination 

services, 

bird‐watching, 

etc.), 

the 

non‐use

existence 

value 

of 

conservation 

is 

more  difficult to assess.

• Can 

we 

use 

economic 

analysis 

to 

target 

where 

is 

it 

most  cost‐effective to undertake conservation?

• Can conservation costs be compensated for?

Non‐NEA work: Policy targeting  without benefit values

Combining Ecology & Economics to Maximise Conservation Efficiency

Page 18: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Case study: Targeting conservation in Sumatra

Page 19: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

The opportunity cost of conservation (OCC) The opportunity cost of conservation (OCC) 

OCC highest in  existing oil palm  plantation and near 

the mill.

Lowest in unplanted  areas distant from 

the mill

Page 20: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

• Over 

1000km 

of 

transect 

line 

walks 

across 

all 

areas 

of  the concession over a four year period. 

• Animal sightings recorded using GPS

• Land 

use 

types 

and 

distances 

to 

different 

areas 

and  features assessed using GIS

• Analysis of the variation in species density across areas 

Modelling the effectiveness of conservation

Page 21: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Wild pig

Leopard cat

Page 22: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Smooth coated otter

East Asian porcupine

Pangolin

IUCN Red List  mammals in 

Central Sumatran  study area

Page 23: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Long tailed macaque

Siamang

Siamang

Agile gibbon

Long tailedmacaque

Pig tailed macaque

Page 24: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Predicted probability of observing red list mammals Predicted probability of observing red list mammals The effectiveness of conservation

Red list mammals Leopard catCosts of conservation

Page 25: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Red list mammals Costs of conservationCost‐effectiveness of conservation for red list mammals

• The smallest scheme (5000ha) conserves viable populations for all but one species. • The intermediate scheme (11,000ha) conserves all species. 

Page 26: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

-10000

-5000

0

5000

10000

5,000ha 10,000ha 20,000ha

Cha

nge i

n pr

ofits

(m ID

R p

a)

Does the expected price premium cover  conservation costs?

Change in profit under three conservation schemes(mid-level price premium)

Page 27: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Conclusions

• Efficient use of resources is always necessary, but  especially so in times of austerity

• Integrated environmental economic analysis can target  policy so as to optimise efficiency and make the most 

of scarce resources. • Advances in valuation mean that, in many cases, CBA 

of environmental policy is feasible. • Even where this is not the case, CEA can help target 

policy

Page 28: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

Long tailed macaque

Siamang

Thanks for  listening 

Page 29: An Economic Assessment of UK Ecosystem Services Bateman's Presentation... · UK Ecosystem Services ... Abbey Conference Centre, Carrow, Norwich NR1 2DD. Wednesday, 6 October 2010

An Economic Assessment of  UK Ecosystem Services 

Contributing authors (and institutions):Barnaby Andrews (CSERGE, UEA), Viviana

Asara

(Cambridge), Tom Askew (Cambridge), Uzma

Aslam

(Leeds), Giles Atkinson (LSE), Ian Bateman (CSERGE, UEA), Nicola

Beaumont (PML), Nesha

Beharry‐

Borg (Leeds), Katherine Bolt (RSPB), Murray Collins (LSE), Emma Comerford

(RSPB), Amii

Darnell 

(CSERGE, UEA), Carlo Fezzi

(CSERGE, UEA), Nick Hanley (Stirling), Caroline Hattam

(PML), Andreas 

Kontoleon

(Cambridge), George MacKerron

(LSE), David Maddison

(Birmingham), Stephen Mangi

(PML), Dominic Moran (SAC), Paul Morling

(RSPB), Joe Morris, (Cranfield), Susana Mourato

(LSE), 

Unai

Pascual

(Cambridge), Grischa

Perino

(UEA), Antara

Sen

(CSERGE, UEA), Daan

van Soest

(Tilburg 

& VU), Mette

Termansen

(Leeds), Dugald

Tinch

(Stirling), Gregory Valatin

(Forestry Research). 

Advisory Board: Sir Partha

Dasgupta

(Cambridge), Brendan Fisher (Princeton, USA), Karl‐Göran

Mäler, (Beijer

Institute, Sweden), Steve Polasky

(Minnesota, USA & Beijer

Institute, Sweden), Kerry Turner (CSERGE, 

UEA). 

Ian Bateman CSERGE, UEA and Head of NEA Economics

Presentation to the Norfolk Biodiversity Forum

Abbey Conference Centre,  Carrow, Norwich NR1 2DDWednesday, 6 October 2010