Ecosystem Valuation and Water Risk: Ed Pinero


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Ecosystem Valuation and Water Risk: Ed Pinero

  1. 1. Ecosystem Valuation What, Why, How? One Water Leadership Conference September, 2013 Edwin Pinero Chief Sustainability Officer September 2013
  2. 2. The Challenges- WHAT? “Ecosystem Services” is a widely used term- but what does it really mean? Services provided by the ecosystem Valuation- how to determine their worth? Scope- What is all included? Performance Assurance- how do you know you valued properly? Governance- who decides? Who controls? 2
  3. 3. Ecosystem Services- WHAT? Storm water management Flood control Coastal stabilization Waste treatment Biodiversity Recreation Aesthetics Carbon management/air quality And many others! Community infrastructure, not just stormwater infrastructure 3
  4. 4. Ecosystem Services Valuation- WHAT? The ecosystem is more than a passive victim of our actions, it plays an active and important role- So……. what is that worth? Getting beyond the “warm and fuzzy” factor What does it mean to value Ecosystem Services? •Valuing the benefits provided by ecosystem services •Valuing losses from ecosystem degradation 4
  5. 5. The Value Proposition- WHY? Communities “use” the ecosystem Opportunities to leverage the ecosystem- nature’s efficiency Interest growing among stakeholders Regulatory and legal requirements Gives a “value-based lens”- quantifying environmental, social, economic, and financial elements- comparing alternatives Can speak “CFO-ese” and “CEO-ese” (ROI, Risk management, business case, and others) Improves decision making- and that is good! 5
  6. 6. Why “hire” the ecosystem as a service provider? Incredibly efficient and adaptable!!!!! 3.5 Billion years of experience!!!!! 6
  7. 7. The Issue with Water Water is “managed” by ecosystem services, but Water IS an ecosystem service Price vs. Cost vs. Value Typically undervalued ESV needs to be able to recognize the this true cost to make informed business decisions 7
  8. 8. Crépieux-Charmy Ecosystem Valuation A water supply catchment area near Lyon, France The local ecosystem is not only a catchment area for water supply but provides heritage value, carbon sequestration, water purification, Intent is for ecologic management of the area What is it worth in terms of water supply? •Natural filtration vs. water treatment •Carbon sequestration •Natural heritage value; including recreation and educational Is it worth it? •Yes! Maintaining the ecosystem is 16x less cost than installed water treatment and 45x less cost than alternatives to replace the economic benefit of carbon sequestration and loss of heritage value 8
  9. 9. CCED Ecosystem Valuation Group of municipalities with a new waste water treatment system What is the additional value of this plant to the ecosystem due to improved discharge quality? •Tourism- nicer beaches •Tourism- water recreation activities •Heritage value •Flood control •Compost production •Reuse of wastewater These are all in addition to the direct benefit of the wastewater treatment 9
  10. 10. New Alberta Wetlands Policy Recognizes that wetlands are valuable for various reasons and that wetlands vary by the ecosystem value, and should be governed accordingly Allows for flexible wetlands management based on relative ecosystem value Values are assigned by category and prioritized Protection and governance hierarchy established based on valuation 10
  11. 11. The WBCSD Guide- HOW? Why a guide now? ESV has been going for decades! •Historically driven by legal and regulatory frameworks- to assign liability and compensation •Many techniques exist •Complicated and variable vocabulary A need for some consistency, transparency, rigor Divided in into Screening Phase (Do I even need to do this?) and the Methodology Phase- (How to?) Was pilot tested by approximately 14 member entities; including water services sector Very useful to public sector as well 11
  12. 12. Thank you!