Seminar 13 Mar 2013 - Session 3 - Watershed PES in Africa_ by SNamirembe

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Forest, Trees and Agroforestry - Component 3: Landscape Management

Securing private sector commitment to watershed Rewards for Environmental Services (RES) agreements in Africa is a challenge. This is partially due to the scarcity of downstream beneficiaries, the prevailing policy and institutional arrangements and the internal inefficiencies of some of the businesses. Using the Sasumua case study, we found that the business case based on improving water quality through sediment reduction is weak; the bigger challenge is increasing and maintaining water flows where the most immediate action for companies is not so much upstream land uses, but management and governance of water pipes between the reservoirs and water users. PRESA is currently exploring three avenues for engaging private sector in RES: using the Applied Information Economics approach to re-examine the business case for optimizing decisions for PES in reservoir management; analyzing policy and institutional frameworks for PES; and engaging stakeholders to consider the fund mechanism, disbursing conditional payments for good land use practices.

WATERSHED PES IN AFRICA
FINDING SOLUTIONS THAT REDUCE TRADE-OFFS
IN LANDSCAPES

Private sector and alternative financing for ES in PRESA sites

Site Direct private sector Alternative financial
ES beneficiary sources for ES incentives
Albertine Rift Mini-hydropower dam Eco-certification of crafts and
- Uganda honey
Ulugurus - Tz DAWASCO; Coca Cola
Usambaras - Tanga City water
Tz Company
Sasumua - NCWSC WSTF, Nature Conservancy,
Kenya World Bank Fund; Green
microfinance agency
Nyando River No private sector buyer Public agencies: NEMA;
Basin - LVMP; World Bank Fund
Kenya
Embu - KENGEN Nature Conservancy
Kenya Government Project:
TANRMP; World Bank Fund
Fouta Djallon Coyah Bottling Company Mining L D A G R O F O R E S T R Y
WOR
companies CENTRE
Guinea

Sediment sources in Sasumua

 Low erosion rates from the
forest

 High rates on some
agricultural areas, exceeding
11.2 tons/ha/year

WORLD AGROFORESTRY CENTRE

Potential to improve water partitioning and reduce
soil erosion through landuse interventions

Sediment yield
Surface Base flow Water yield (×103 tons/
Landuse
runoff (mm) (mm) (mm) year)

Base case 193 488 680 32.6

Contour farming 162 514 675 16.6

% change -16.1 +7.6 -0.7 49

Terracing 151 525 674 4.9

% change -21.8 +5.3 -0.9 85

WORLD AGROFORESTRY CENTRE

CASE FOR PES: NAIROBI WATER COMPANY
Grassed waterway causing 20% reduction in
sedimentation

Costs with Costs without
PES PES

ALIGNING ES DEMAND WITH SUPPLY
Sasumua conversations
PES can reduce We pay multiple levies
sedimentation to government

NCWC
Science We have no mandate
WSTF
PES can make a strong That is small change
business case – net savings
NCWC
Science

We are willing to accept payment We are willing to pay more
for improving land use
Nairobi City
WRUA
We have no authority to increase tariffs
NCWC
We can provide We want more regular
improved quality flows and quantity
WORLD AGROFORESTRY CENTRE
WRUA Nairobi City

Institutional structure for Catchment management

OTHER SOURCES WRMA

WSTF
Water abstractor/
utility company

WRUAS
Catchment management plans

Current level of land management does not provide satisfactory watershed services
Farmers are not obligated to invest in conservation above legal and societal expectations
Optional community driven development (CDD) is availableOto L D A G R O F O R Eindividuals T R E
W R CBOs and not S T R Y C E N

Current insights from PES Research

CES: Commoditized Environmental Services
 Direct interaction ES providers &beneficiaries
 Recurrent monetary payments

Rewards are too small and a
broader outlook of PES
mechanisms is necessary

CIS: Co-Investment in COS: Compensating for
(landscape) Stewardship Opportunities Skipped
 A flexible contract with broad Recurrent payment for proxies
sanctions for
 Entrust resource management to  Accepting restrictions
local communities  Achievement of a condition
 Based on management plan high W O R effort R O F O R E S T R Y C E N T R E
or L D A G
social capital

Looking forward
• Scaling from project-based to national level integration of PES
approaches into institutions and policies
• Increasing and ensuring sustainable private sector commitment
• Optimising business case for private sector investment
• Public-to-public PES in managing trans-boundary resources (e.g.,
Nile river; Congo forest etc.)

WORLD AGROFORESTRY CENTRE

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