Promoting Payments for Ecosystem Services and related sustainable financing schemes in the Danube Basin

Wetlands – modern problem or forgotten old solution ?

Examples of usage and developing of market mechanisms from wetlands restoration

Georgi StefanovPolicy and Climate change expert WWF - Bulgaria

Workshop Nisovo, 03.04.2012

Nature park "Persina" was created in late 2000 by the Minister of Environment and Water and is one of the youngest parks in Bulgaria. Situated within three Danube municipalities Nikopol, Belene and Svishtov, with a total area of 21 762,2 ha and approximately 27 000 inhabitants.

"Persina" is unique for Bulgaria and is the only park along the Bulgarian part of Danube. Declaring its objectives with conservation and restoration of Danube wetlands, with particular emphasis on preserving the natural state of numerous islands falling within the park - the islands are 24 in number, of which 5 are Romanian. There are 3 reserves, 2 natural landmarks and 1 protected area. The territory in 2007 became also a Natura 2000 site under the two directives (Habitats and Birds). In the park you can find more than 170 bird species and 450 plants species 1/3 of them directly related to the water ecosystems.

The most important type of ecosystems in the park are flooded Danube forests (the Bulgarian jungles) and inland marshes. WWF has assisted the process of developing the park, and the last 10 years work in the all of it’s programs and implementing many different projects in the park area.

Brief info about Persina nature park

Wetlands and marshes - what we know and Wetlands and marshes - what we know and what we don’t know about them ?what we don’t know about them ?

• Breading mosquitoes? (breeding fish)

• Breeding diseases? (used in medicine)

• Smell very bad? (methane production and use of biomass)

• Occupy unnecessary space for farmland? (minimum area, maximum benefits) (help for water balance, high value biodiversity, flood regulation)

• Other? (the highest productive ecosystems worldwide)

A) Environmental Benefits• Sustainable management and use of biomass from wetlands and farmlands area of 5400 hectares (240 hectares are protected areas – “Kaikusha” marsh).• Reduce the unsustainable agricultural practice of burning stubble in agricultural land and conservation of the biodiversity.• Reduction of CO2 in the atmosphere associated with stubble burning and decompose of biomass in the fields / wetlands.• Improve water regime of the marsh “Kaikusha” and recovery of its regulatory functions with respect to water, maintenance of fish stocks, absorption and fixation of CO2, maintaining biological diversity.• Improvement of soil fertility on more than 5,000 ha of agricultural land.• Improve water quality in the area of 150 ha.

B) Economic benefits• Creation of a business interest in the use of biomass by generating revenue from the sale of pellets and briquettes • Creation of economic opportunities for users of land utilization of residues in the land as an additional source of income and the costs of collection and transmission (transport).• Offering an alternative to the local population to shift from fossil fuels as coal and firewood consumption to pallets and briquettes and reduce the energy costs by an average of 30%.

C) Social benefits • Creation of employment among the local population by engaging them in processes of extraction and processing of biomass.• Creation of jobs indirectly as an additional source of revenue for collection and transportation of raw materials.

Nature Park – “Persina” and surrounding agricultural areas - creation of market scheme “biomass from wetlands” - maximum benefits for everybody

The scheme …

Providers of ES:

Farmers

Buyers of ES:Companies for production of

pellets

biomass

euro

• Easy for connection with the other WWF programs, projects and activities in the region; High value and available area; Climate change orientated solution. Big potential for growing. • Feasibilities studies show that in Bulgaria about 30% straw, 65% of cornstalks and 80% of other solid agricultural waste can be taken into account for energy production, an estimated 800,000 tons annually.

• Economical solution to find enough political support for wetland management and wetland restoration paid by itself. Approximately biomass production from the existing protected wetlands (40 000 hectares) by keeping nature condition (cut only 20% per year) an estimated 80,000 tons annually in production to pallets and briquettes.

Why we choose to focused on biomass from wetlands and unused agriculture waste ?

• New renewable energy sources (RES).• Jobs, business, cheap heating for local people.• Wetlands as a "reservoir" of carbon• Biomass, in all its aspects, energy, construction, customs, traditions and

culture• Explore the possibilities of voluntary trading markets

Energy use of biomass and Energy use of biomass and Ideas for implementation inIdeas for implementation in

coming yearscoming years

Amount of carbon sequestration by the most typical species (plants) of “Kaikusha” marsh (150 ha)

  P gC/m2/y D gC/m2/y Area ha P gC/m2/y R gC/m2/yPhragmites (reed) 802 617 120 104,3 80,2

Typha (bulrush) 955 735 21 150,6 69,3

Schoenoplectus (sedge) 890 685 9 127,2 77,2

“C” lost   20

total production   719

total respiration   499

“C” accumulation   201

Total average of 2 tones / ha / year = 600 tons Kaikusha marsh > Euro 6000Total average of 2 tones / ha / year = 600 tons Kaikusha marsh > Euro 6000

Production (P); decomposition, absorption (D); carbon accumulation (R)

Фонд Описание Контакт

Multilateral Carbon Credit Fund(съвместна инициатива на ЕБВР и ЕИБ)

Допустими проекти Въглеродните кредити могат да се генерират от разнообразни проекти, включително:Енергия от ВЕИ – вятър, води, биогас, биомасаЕнергийна ефективност в индустрията (когенерация) и строителствотоИзбягване на аварии и изтичане при добива и обработката на природен газ и нефт.Преминаване към въглеродно-неутрални гориваПоглъщане на емисии парникови газове (въглеродно свързване в гори)

Jan-Willem van de Ven, Head of the MCCF SecretariatPhone: (+44)2073387821    (+44)2073387821      Email: vandevej@ebrd.com European Bank for Reconstruction and DevelopmentOne Exchange Square, London EC2A 2JN, United KingdomKristin Lang, Deputy Head of the MCCF SecretariatPhone: (+352)437987009(+352) 4379 8 7009Email: lang@eib.org European Investment Bank100, boulevard Konrad Adenauer, L-2950 LuxembourgWest zone Carbon manager: Haskoning, cmwest@ebrd.com

Prototype carbon fund на Световна банка

PCF финансира разнообразни пилотни проекти за редуциране на въглеродните емисии в рамките на механизмите Чисто развитие и Съвместно изпълнение.

Carbon Finance Unit, ENVThe World Bank, 1818 H Street, NW, Washington, DC 20433, USAphone 202.473.9189 fax 202.522.7432helpdesk@carbonfinance.org

BioCarbon Fundна Световна банка

Това е специализиран фонд на Световна банка за демонстрационни проекти, които свързват въглеродни емисии в горски екосистеми и земеделски култури. Фондът е публично-частна инициатива, администрирана от WB, която цели ценово-ефективно поглъщане на въглерод, съчетано с опазване на биоразнообразието и социални ползи. Фондът може да одобрява разнообразни проекти, свързани с подобряване на управлението на земите и горското стопанство. Такива са залесяване, попълване, редуциране на емисии от обезлесяването, земеделски ползвания.

Carbon Finance Unit, ENVThe World Bank, 1818 H Street, NW, Washington, DC 20433, USAphone 202.473.9189 fax 202.522.7432helpdesk@carbonfinance.org

Italian Carbon Fund (ICF)

ICF финансира проекти в широк диапазон, включително въглеродно свързване. Фондът е създаден от правителството на Италия по споразумение със Световна банка.

Carbon Finance Unit, ENVThe World Bank, 1818 H Street, NW, Washington, DC 20433, USAphone 202.473.9189 fax 202.522.7432helpdesk@carbonfinance.org

Danish Carbon Fund Фондът обединява финансов ресурс от Правителството на Дания и няколко големи датски енергийни компании по споразумение със Световна банка

Carbon Finance Unit, ENVThe World Bank, 1818 H Street, NW, Washington, DC 20433, USAphone 202.473.9189 fax 202.522.7432helpdesk@carbonfinance.org

№ Type of the fuel Calorific value Efficiency

Price of the fuel (by 2010)

Price per 1 КW

1 Diesel 11,67 KW/liter 88% 2.07 lv/liter 0.204

2 Electricity 1 KW 100% 0.173lv/kw 0.173

3 Nature gas 9,89 KW/m3 90% 0.9349lv/m3 0.105

4 Wooden chips 4.9/KW/kg 90% 0.36lv/kg 0.081

5

Pallets from wetlands and agriculture waste 5.16/KW/kg 90% 0.28lv/kg 0.063

Comparison table of prices of heat from different fuel types allows automation of the heating process

Type of culture

Sown areaha

Average yield per ha - ton

Overall biomass production - ton

Wheat and barley 1400 4 5604

Corn 2875 7 21125

Sunflower 1027 3 3081

Reed 1790 10 17900

TOTAL 47 710

Biomass amounts of a different cultures

№ Name of indicators Unit of

quantityStandardized

methods, validated

internally lab

№ for the

record

Results form tasting

NormDIN 51731

1. Moisture % DIN 51718 638-3 5,1±0,2

12 max

2. Specific heating value

kcal/kg DIN 51900 638-3 - -

2.1 Working fuel kcal/kg DIN 51900 638-3 4346±25

4181- 4657

2.2 Working fuel KJ/kg DIN 51900 638-3 18196±90

17500- 19500

3. Sulfur content of dry mass

% DIN 51724 638-3 0,056±0,003

0,08 max

4. Balance after incineration / ash / dry weight of

% DIN 51719 638-3 5,5±0,1

1,5 max

5. Extraction of volatile substances on dry weight

% DIN 59700 638-3 78,2±0,2

-

Test results of the Reed - Independent laboratory analysis – Sofia

Comparisons of the financial value of biomass yield in two versions:

option 1

Processing of 1 ton of biomass in the village Lesidren (150 km)

option 2

Processing of 1 ton of biomass in Belene (20 km)

Leva per ton Leva per ton

Production of biomass 40,00 lv. 40,00 lv.

Primary processing (baling) and transport 120,00 lv. 30 lv.

Processing of biomass supply and delivery 200,00 lv. 200,00 lv.

Labor 100,00 lv. 100,00 lv.

Value of the pallets 460,00 lv. 370,00 lv.

Market value of conventional pellets 400,00 lv. 400,00 lv.

Reserve / Balance + 40,00 lv. - 30,00 lv.

Economical conclusion based on the analysis and calculated potential, says that the indicators for

evaluating the effectiveness of the investment and financial indicators give reason to believe that the

investment is effective and the idea could be realized

• Net Present Value – by 33% for 10 years

• Internal Rate of Return – approximately by 68%

• Profitability Index – 6,3%

• Payback period – 2 years

Indicators of treated water, meeting the required values for the discharge of treated wastewater in accordance with national legislation in this area.

Two to three times lower financial costs for construction and maintenance of such equipment compared with conventional treatment plants.

Cover within the European requirements concerning the construction of treatment facilities in small settlements less than 10 000 people.

Possibilities for utilization of biomass from these wetlands, such as renewable

Creation of semi-natural habitats suitable for a significant part of the flora and fauna that inhabit these types of habitats.

Create additional opportunities for tourism and recreation around those areas adjacent to settlements.

And more benefits…: constructed wetlands as a wastewater treatment system – very suitable for

small villages

Conclusion for wetlands Conclusion for wetlands The highest - productivity ecosystems

Opportunities for additional income for local people

Diverse benefits, including all

Local energy source

Decision to costly problems such as floods and construction of treatment plants for domestic wastewater in in small settlements

Highest absorbability of C02

ЗАКЛЮЧЕНИЕТО !

‘It takes a new way of thinking to solve the problems that we created by the old way of thinking’

"Трябва нов начин на мислене за решаване на проблемите, които ние сме създали поради стария модел на мислене"

Thank you!

Georgi Stefanov gstefanov@wwfdcp.bg

www.panda.org/dcpo