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Seminar 13 Mar 2013 - Session 3 - Environmental service reward experience in Asia by BLeimona
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Seminar 13 Mar 2013 - Session 3 - Environmental service reward experience in Asia by BLeimona

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Payment for environmental services (PES) is a conservation policy option that its implementation in Asian developing countries demands integrating environmental service provision and livelihood …

Payment for environmental services (PES) is a conservation policy option that its implementation in Asian developing countries demands integrating environmental service provision and livelihood enhancement. The analysis of a payment for carbon service in Indonesia revealed that tensions between PES design rules and land managers’ practices existed. It can shed light onto PES positive and negative impacts on land managers, including their performance in accomplishing their contractual agreements with the carbon buyer. This empirical case overall emphasizes the importance of examining PES beyond conventional economic analysis, i.e. micro- and meso-analysis. Consequently, PES research from developing countries might consider the involvement of other scales targeting pico-economics, where decision making, interpretation of observations and construction of perceived causal mechanisms influence PES performances and ensure balance of tradeoff between ES provision and multidimensional poverty alleviation. Moreover, the macroeconomic context of national development and giga economic scale of global issues imply direct relevance to effectiveness and fairness of PES schemes.


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  • 1. SHARING GOOD PRACTICES AND LESSONS FROMREWARDS FOR, USE OF AND SHARED INVESTMENT IN PRO- POOR ENVIRONMENTAL SERVICES SCHEME (RUPES-II) 2008 – 2012 Beria Leimona and Meine van Noordwijk ICRAF SEA – RUPES One day Seminar“Tree cover transitions and investment in multicolored economy: hypothesis grounded in data” Bogor, 13 March 2013
  • 2. RUPES SITES IN ASIA covering 12 sites in 8 countries 2002-2012Bac Kan Action research sites
  • 3. Balancing act is needed ES Provisions andEnvironmental GoalEfficiency Fairness Pro-poor Adapted from van Noordwijk et al (2011)
  • 4.  Poverty is a major issue – enhancement of ES cannot be disentangled from development needs Communities depend greatly on social contacts in managing their landscapes Defining pro-poor as: Include  Access  Process and decision making pro-poor approach  Outcome .... of the schemes to PES ....support a positive bias toward poor stakeholders development (Van Noorwijk & Leimona 2010)
  • 5. 1 Access to PES scheme  Designed and administered for fairness of farmers with low formal education, prone to social conflicts and influenced by power structures within their community  Case: Conservation reverse-auction – mimicking market-based mechanism for soil erosion  PES contractual relationships are subject to asymmetric information between landowners and conservation agents.  Information asymmetries can limit the effectiveness of PES schemes and make them expensive to implement.  The auction for the PES programme in Indonesia was designed using a uniform price rule for fairness reasons.  However, uniform pricing is relatively less cost-effective compared to the discriminative price rule.  Different targeting scenarios: cost-efficiency vs pro-poor
  • 6. Targeting No of No of Price per Average Erosionscenario house- hectares hectare erosion potential holds potential per dollar index per enrolled hectareCost only 34 25.00 172 22.24 0.129Cost- 31 24.00 167 23.14 0.139efficiencyEligibility 31 24.00 167 23.10 0.138rulePro-poor 13 4.75 1,111 22.69 0.200Source:Jack, B. K., Leimona, B., & Ferraro, P. J. (2008). A Revealed Preference Approach to EstimatingSupply Curves for Ecosystem Services: Use of Auctions to Set Payments for Soil Control in Indonesia.Conservation Biology, 23(2), 359-367.
  • 7. 2 Process and decision making  Applying multiple knowledge approach for ES  Clarifying drivers of problems and identifying ES – not based on perception per se  Negotiation support system  Nested approach to PES  Free prior informed consent at individual level  Why?  Start with broader paradigm of PES: strict conditionality generally cannot work in developing countries • Lack of data in connecting land use change and ES provisions • Lack of monitoring tools, capacities and institutions
  • 8. Singkarak Sumberjaya Kapuas Hulu TalauInitial Deforestation at the upstream of Deforestation caused: Forest conversion to coffee Forest conversion to agriculture Deforestation surrounding watershed caused floods and agroforestry gardens caused and illegal logging causing the water spring decreasedperceived decrease of the water level of the lake, thus disturbing the • Floods  paddy field along the river increase of sediment yield, thus clogging the HEP increased of sediment yield, thus decreasing the water water supply from the spring.problem operational of hydroelectric power electricity generator and quality for drinking water • Decrease of the water level of the company (HEP). causing low electricity company. production. lake  disturbingthat operationalfrom water Decrease of water level was caused Sedimentation mostly was Low run-off showed the Lack of water ofResults from HEP watershed was still well- by ineffective watershed buffering caused by instable geological springs dominantly washydrological in retaining water during rainy season. characteristics of the watershed. functioning with the current land practices and changes. caused by climatic changes and ineffective watershed inanalysis with Downstream water quality was Coffee plantation less than 3 Intensive use along riparian buffering water.combined influenced by high domestic and agricultural pollutants. years, landslides (occurred in forested area), river bank causing river bank collapse and river edge cutting for boat Overconsumption and unwise use of water fromecological Floods were mostly caused by river collapse, and dirt footpaths transportation were sources of the spring worsened water were sources of sediment sediment yield. management and causedknowledge stream diversion by HEP. yield. conflicts. Reforestation uses trees with low Simple sediment retention Tembawang traditional Reviving local wisdom ofManagement evapotranspiration. construction and planting agroforestry system along spring water managementimplication Local wisdom maintains clean deep root trees, including compaction of dirt path were riparian zone helps reducing pressures to soil erosion. can help solving internal conflicts. water stream in the upstream andfrom local conserving native ikan bilih. useful to reduce surface erosion.perspectives Upstream village level: maintaining Collective action to conserve Collective action to conserve Collective and individualManagement current intact environment, i.e. riparian zone involving riparian zone involving village action to promote tree-implication for biodiversity conservation such as organic coffee, bundled VCM and village members along the river. members along the river. planting to increase watershed buffering. Collective action to maintainwatershed watershed services. Individual and collective intact forest in the upper Spring water managementmanagement Villages surrounding the Lake: improving water quality of the action to manage coffee garden by applying simple watershed as a potential for REDD+ type schemes. with wise consumption and regulated extraction ofand RWS Lake and connecting river. construction and multistrata Law enforcement on illegal PDAM. tree-planting. logging and logging permits.Source: Leimona, B., Lusiana, B., Van Noordwijk, M., Ekadinata, A., & Mulyoutami, E. (2011).Reconciling multiple ecological knowledge for rewarding watershed services in the uplands ofIndonesia. World Agroforestry Centre
  • 9. Singkarak Sumberjaya Kapuas Hulu Talau Deforestation at the upstream of Forest conversion to coffee Forest conversion to agriculture Deforestation surroundingInitial watershed caused floods and agroforestry gardens caused and illegal logging causing the water spring decreasedperceived decrease of the water level of the lake, thus disturbing the increase of sediment yield, thus clogging the HEP increased of sediment yield, thus decreasing the water water supply from the spring.problem operational of hydroelectric power electricity generator and quality for drinking water company (HEP). causing low electricity company. production. • Decrease of water level  ineffectiveResults from Decrease of water level was caused Sedimentation mostly was watershed buffering in retaining water water Low run-off showed that Lack of water from by ineffective watershed buffering caused by instable geological watershed was still well- springs dominantly was during rainywith the current functioning season.hydrological in retaining water during rainy season. characteristics of the watershed. land practices and changes. caused by climatic changes and ineffective watershed inanalysis with • Downstream water qualitybuffering water.  high Downstream water quality was Coffee plantation less than 3 Intensive use along ripariancombined influenced by high domestic and domestic and agricultural pollutants. years, landslides (occurred in causing river bank collapse and Overconsumption and agricultural pollutants. forested area), river bank river edge cutting for boat unwise use of water fromecological • Floods  river stream of the springby HEP.water collapse, and dirt footpaths transportation were sources diversion worsened Floods were mostly caused by river were sources of sediment sediment yield. management and causedknowledge stream diversion by HEP. yield. conflicts. Reforestation uses trees with low Simple sediment retention Tembawang traditional Reviving local wisdom ofManagement evapotranspiration. construction and planting agroforestry system along spring water managementimplication Local wisdom maintains clean deep root trees, including riparian zone helps reducing compaction of dirt path were pressures to soil erosion. can help solving internal conflicts. water stream in the upstream andfrom local conserving native ikan bilih. useful to reduce surface erosion.perspectives Upstream village level: maintaining Collective action to conserve Collective action to conserve Collective and individualManagement current intact environment, i.e. riparian zone involving riparian zone involving village action to promote tree-implication for biodiversity conservation such as organic coffee, bundled VCM and village members along the river. members along the river. planting to increase watershed buffering. Collective action to maintainwatershed watershed services. Individual and collective intact forest in the upper Spring water managementmanagement Villages surrounding the Lake: improving water quality of the action to manage coffee garden by applying simple watershed as a potential for REDD+ type schemes. with wise consumption and regulated extraction ofand RWS Lake and connecting river. construction and multistrata Law enforcement on illegal PDAM. tree-planting. logging and logging permits.
  • 10. Singkarak Sumberjaya Kapuas Hulu Talau Deforestation at the upstream of Forest conversion to coffee Forest conversion to agriculture Deforestation surroundingInitial watershed caused floods and agroforestry gardens caused and illegal logging causing the water spring decreasedperceived decrease of the water level of the lake, thus disturbing the increase of sediment yield, thus clogging the HEP increased of sediment yield, thus decreasing the water water supply from the spring.problem operational of hydroelectric power electricity generator and quality for drinking water company (HEP). causing low electricity company. production. Decrease of water level was caused Sedimentation mostly was Low run-off showed that Lack of water from waterResults from by ineffective watershed buffering caused by instable geological watershed was still well- springs dominantly washydrological in retaining water during rainy season. characteristics of the watershed. functioning with the current land practices and changes. caused by climatic changes and ineffective watershed inanalysis with Downstream water quality was Coffee plantation less than 3 Intensive use along riparian buffering water.  Reforestation uses trees with lowcombined influenced by high domestic and agricultural pollutants. years, landslides (occurred in causing river bank collapse and Overconsumption and evapotranspiration. boat forested area), river bank river edge cutting for unwise use of water fromecological Floods were mostly caused by river collapse, and dirt footpaths transportation were sources of the spring worsened water were sources of  Local wisdom maintains clean water and caused sediment sediment yield. managementknowledge stream diversion by HEP. yield. conflicts. Reforestation uses trees with low stream in the upstream and Reviving local wisdom of Simple sediment retention Tembawang traditional conservingManagement evapotranspiration. nativeagroforestry system along construction and planting ikan bilih. spring water managementimplication Local wisdom maintains clean deep root trees, including riparian zone helps reducing compaction of dirt path were pressures to soil erosion. can help solving internal conflicts. water stream in the upstream andfrom local conserving native ikan bilih. useful to reduce surface erosion.perspectives Upstream village level: maintaining Collective action to conserve Collective action to conserve Collective and individualManagement current intact environment, i.e. riparian zone involving riparian zone involving village action to promote tree-implication for biodiversity conservation such as organic coffee, bundled VCM and village members along the river. members along the river. planting to increase watershed buffering. Collective action to maintainwatershed watershed services. Individual and collective intact forest in the upper Spring water managementmanagement Villages surrounding the Lake: improving water quality of the action to manage coffee garden by applying simple watershed as a potential for REDD+ type schemes. with wise consumption and regulated extraction ofand RWS Lake and connecting river. construction and multistrata Law enforcement on illegal PDAM. tree-planting. logging and logging permits.
  • 11. Singkarak Sumberjaya Kapuas Hulu Talau Deforestation at the upstream of Forest conversion to coffee Forest conversion to agriculture Deforestation surroundingInitial watershed caused floods and agroforestry gardens caused and illegal logging causing the water spring decreasedperceived decrease of the water level of the lake, thus disturbing the increase of sediment yield, thus clogging the HEP increased of sediment yield, thus decreasing the water water supply from the spring.problem operational of hydroelectric power electricity generator and quality for drinking water company (HEP). causing low electricity company. production. Decrease of water level was caused Sedimentation mostly was Low run-off showed that Lack of water from waterResults from by ineffective watershed buffering caused by instable geological watershed was still well- springs dominantly washydrological in retaining water during rainy season. characteristics1. of the watershed. functioning with the current land practices and changes. caused by climatic changes and ineffective watershed inanalysis with Downstream water quality was 1. Upstream village level Coffee plantation less than 3 Intensive use along riparian : buffering water.combined influenced by high domestic and agricultural pollutants. years, landslides (occurred in causing river bank collapse and Overconsumption and maintaining current boat forested area), river bank river edge cutting for intact environment from unwise use of waterecological Floods were mostly caused by river collapse, and dirt footpaths • transportation were sources of the spring worsened water biodiversity conservation such as caused were sources of sediment sediment yield. management andknowledge stream diversion by HEP. yield. organic coffee conflicts. Reforestation uses trees with low Simple sediment retention Tembawang traditional Reviving local wisdom ofManagement evapotranspiration. construction and planting• bundled system along watershed management agroforestry VCM and spring waterimplication Local wisdom maintains clean deep root trees, including riparian zone helps reducing compaction of dirt path were services soil erosion. pressures to can help solving internal conflicts. water stream in the upstream andfrom local useful to reduce surface conserving native ikan bilih. erosion. 2. Villages surrounding the Lake :perspectives Upstream village level: maintaining improving water quality of the Lake individual Collective action to conserve Collective action to conserve Collective andManagement current intact environment, i.e. riparian zone involvingand connecting river.village riparian zone involving action to promote tree-implication for biodiversity conservation such as organic coffee, bundled VCM and village members along the river. members along the river. planting to increase watershed buffering. Collective action to maintainwatershed watershed services. Individual and collective intact forest in the upper Spring water managementmanagement Villages surrounding the Lake: improving water quality of the action to manage coffee garden by applying simple watershed as a potential for REDD+ type schemes. with wise consumption and regulated extraction ofand RWS Lake and connecting river. construction and multistrata Law enforcement on illegal PDAM. tree-planting. logging and logging permits.
  • 12. Financial capital Emotion, intuition Macro economic Human Social Risk & . development buffering capital Pico capital economics sermons Ratio Social norms Infra- Natural structure Spatial planning & LU rights capital Giga economic green developmentSource: van Noordwijk, M., Leimona, B., Jindal, R., Villamor, G. B., Vardhan, M.,Namirembe, S., et al. (2012). Payments for Environmental Services: Evolution TowardEfficient and Fair Incentives for Multifunctional Landscapes. Annual Review ofEnvironment and Resources, 37(1), 389-420.
  • 13. Four Level of ‘conditionality’Co-investment in Level IVES stewardshipCompensationfor more Level II / IIIbeneficial landpracticesCommoditized Level IES Source: Van Noordwijk, M., & Leimona, B. (2010). Principles for fairness and efficiency in enhancing environmental services in Asia: payments, compensation, or co-investment? Ecology and Society, 15(4).
  • 14. 3 Outcome of PES scheme  Recognizing multi-dimension of poverty  Benefits were mostly non- financial:  expanded social networks with external stakeholders;  knowledge and capacity of the community; and  small-scale public infrastructure investments.
  • 15. The livelihood issues discussed in focus groups Capital Type of information discussed Financial Sources of income over the three periods Human What (if any) capacity/skills/knowledge were gained through the scheme? Social What was the nature and degree of trust with other stakeholders during the three periods? What norms or standards of behavior did the community set itself in connection with the scheme (e.g. sanctions etc)? What were community’s networks like during the three periods? Natural What benefits did they gain from the watershed and its protection? Physical Had any investments been made as a result of the scheme (e.g. infrastructure)?Source: Leimona, B., Pasha, R., & Rahadian, N. (2010). The livelihood impacts of incentive payments for watershedmanagement in West Java, Indonesia. In L. Tacconi, S. Mahanty & H. Suich (Eds.), Livelihoods in the REDD?: Payments forEnvironmental Services, Forest Conservation and Climate Change. Cheltenham: Edward Elgar.
  • 16. Household income sources (%)Source of Income After PES Before PES Before PES (before (2005- now) (2000 -2005) 2000) P NP P NP P NPMelinjo 26.67 28.33 23.33 31.67 15.00 16.67Farming labor 15.00 15.00 0.00 8.33 0.00 13.33Coconut 11.67 8.33 10.00 8.33 15.00 10.00Clove 10.00 6.67 18.33 6.67 11.67 10.00Coffee 10.00 10.00 15.00 10.00 16.67 18.33Durian 6.67 3.33 13.33 8.33 23.33 11.67Salak 5.00 8.33 5.00 5.00 3.33 0.00Wood 5.00 6.67 8.33 0.00 0.00 0.00Payment for ES 3.33 0.00 0.00 0.00 0.00 0.00Banana 1.67 1.67 3.33 3.33 3.33 11.67Cocoa 1.67 0.00 0.00 0.00 0.00 0.00Petai 1.67 6.67 0.00 5.00 0.00 0.00Cotton 1.67 0.00 3.33 1.67 5.00 1.67Jengkol 0.00 0.00 0.00 0.00 5.00 0.00Paddy 0.00 0.00 0.00 0.00 0.00 1.67Upland paddy 0.00 1.67 0.00 5.00 1.67 0.00Others (clove labor, livestock 0.00 3.33 0.00 6.67 0.00 5.00labor, motorbike renting,construction labor, trader)
  • 17. Type of knowledge/ capacity/skills gained by participants and non-participants after the PES implementationType of knowledge/capacity/skills Participant (%) Non-participant (%)ConservationCauses of erosion, landslides and downstream sedimentation 100 17How to maintain clean water and to reduce air pollution 83 -Roles of trees in conservation 67 -Simple construction to prevent erosion 50 -Understanding of PES concept 33 17Institution and GovernanceAbility to govern an organization 67 17Ability to solve problems within farmer groups 67 -Administration of farmer groups 50 17Networking to improve local business and PES implementation 50 -Transparent financial management 33 -How to develop local businessLivestock 33 17Agriculture 17 -Fishery - -
  • 18. Trust among internal and external stakeholders Relationship How trust is expressed Amongst participants Borrowing money and rice; Sharing information; Mortgaging (loans); Collective labor sharing Participants and government Making identification and family card; Paying tax; Receiving administrative information; Getting cash assistance; Maintaining security Participants and non- Collective labor sharing; participants Sharing information; Borrowing money, rice, daily needs and construction materials Participants and FKDC Delivering the payments for accomplishing the contracts; Sharing information; Maintaining transparency in managing the funds of organizations. Participants and PERHUTANI Giving seedlings; Giving information; Giving access to manage forest and plant ally-cropping on the area of PERHUTANI. Participants and NGO Implementing programs; Sharing information, especially on environmental services; Conducting meetings.
  • 19. Thank You World Agroforestry CentrePO Box 161, Bogor, 16001, INDONESIA Tel: +62 251 8625415 FAX: +62 251 8625416http://www.worldagroforestrycentre.org
  • 20. George Price’s condition for intergenerational increase inaltruism:( Individual Gain-Loss )+( Social cohesion )( Group Gain-Loss )>0 Carrots Sticks