The Economics of Ecosystems and
                            Biodiversity (TEEB)

   The Economics of Ecosystems and Biodiv...
TEEB overview



  1. TEEB Background
  2. The links: Biodiversity, Ecosystems,
     Functions, Benefits and Value
  3. TE...
TEEB overview



 1. TEEB Background
 2. The links: Biodiversity, Ecosystems,
    Functions, Benefits and Value
 3. TEEB P...
Background: TEEB’s Genesis



Potsdam 2007: meeting of the environment
   ministers of the G8 countries and the five
   ma...
TEEB’s Goals

 •    Assess and communicate the urgency of action to address ecosystems
      and biodiversity loss – by pr...
TEEB Ambitions


1. Assess and communicate the value of ecosystems and biodiversity –
   in qualitative, quantitative and ...
History Lesson: What were the
                                             past Losses?



       Global Forest Area has s...
Running down our natural capital
                     The Demise of Global Fisheries




                                 ...
Substitution?

                     We are fishing down the foodweb – D. Pauly (UBC, Canada)




Source: L Braat presentat...
TEEB overview



 1. TEEB Background
 2. The links: Biodiversity, Ecosystems,
    Functions, Benefits and Value
 3. TEEB P...
Mapping changes : from Biodiversity
                      & Ecosystems to Economic Values




      (Human)
       Drivers...
Ecosystem Services - The Millennium Ecosystem
                               framework




Source: MEA
The link between biodiversity,
                            ecosystems, their services, and benefits
                      ...
Ecosystem Services across land-uses:
                              Trade-offs of conversion

  1natural                   ...
Ecosystem services
                    public goods & difficulty of valuation


       Spiritual & religious              ...
TEEB overview



 1. TEEB Background
 2. The links: Biodiversity, Ecosystems,
    Functions, Benefits and Value
 3. TEEB P...
TEEB – Interim Report
COP-9, Bonn, May 2008




                    Economic Size &
                    Welfare Impact of
...
Biodiversity loss - 1700 to 2050




                                                                                     ...
The Global Loss of
   Biodiversity
                                                                                       ...
The Global Loss of
   Biodiversity
                                                                                     20...
Global COPI
                             Loss of Ecosystem services
                                from land based ecosys...
(1) Economic size of losses
                          (COPI 1 study)

A : 50-year impact of inaction or        B : Natural...
COPI - Some key results


• The welfare loss grows with each year of biodiversity and ecosystem loss.
• Over the period 20...
TEEB overview



  1. TEEB Background
  2. The links: Biodiversity, Ecosystems,
     Functions, Benefits and Value
  3. TE...
TEEB – Final Reports
           Sep 2009 - June 2010


                            Science & Economics
                   ...
The Process for TEEB Phase 2


                           2008                                         2009               ...
The D1 (Policy Level) TEEB Report:
                   D1     Structuring the issues
                             The “wire...
The D1 (Policy Level) TEEB Report:
                 D1        (The “wireframe”)
                        turned into questi...
TEEB for Policy Makers
             Some working recommendations

The North has a major responsibility to act and provide ...
TEEB for Policy Makers
           Some working recommendations


 Sector priorities:


Fisheries (full scale emergency);

...
Solutions - areas of focus


   The cost and price signals in the economy need to reflect the benefits
  of ecosystems and...
The D1 (Policy Level) TEEB Report:
                                Chapter 5

                   Policies to Reward (unrec...
PES & REDD


              Contributions to today’s debate

                     - key points and questions
              ...
PES - A set of Instruments to Reward
            Ecosystems Services: Locally, Regionally
               and Nationally; b...
Local action leads to local, to national & to
                          global benefits - scope for PES?


    Mainly loca...
Payments for Environmental Services (PES)
                     and the Polluter Pays Principle (PPP)


                   ...
REDD (Reduced Emissions from
              Deforestation and Forest Degradation)




 REDD – An Instrument to Reward the C...
D1: REDD
                     Working key Messages

REDD and Biodiversity - Synergies in both directions
                 ...
PES instruments and ESS -
                            potential for the future? -for discussion

Ecosystem service        ...
Thank You


    & looking forward to your questions and feedback
           & also your presentations on PES/REDD!

      ...
Thank You!


•   Further information and Call for Evidence: www.teebweb.info

•   Contact Scientific Coordination: teeb@uf...
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TEEB by Patrick ten Brink of IEEP Oslo PES Workshop 5 May 2009 Final

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Presentation on TEEB by Patrick ten Brink of IEEP at the PES Workshop on the 5 May 2009 in Oslo

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TEEB by Patrick ten Brink of IEEP Oslo PES Workshop 5 May 2009 Final

  1. 1. The Economics of Ecosystems and Biodiversity (TEEB) The Economics of Ecosystems and Biodiversity (TEEB) Ambitions, Content, Process and Working insights Workshop on Payment for Ecosystem Services Fridtjof Nansen Institute, Polhøgda, Lysaker (Oslo) Friday 5 June2009, 09:00-13:00 An initiative of the G8+5, BMU (D) & the Patrick ten Brink European Commission TEEB D1 Co-ordinator Supported by Defra (UK), UNEP, OECD, CBD Secretariat, VROM, EEA, UFZ, IUCN, Univ. Liverpool, IEEP & experts from across the world Building on and borrowing from the work & insights of the wider TEEB team and contributors of supporting studies, call for evidence and other contributions 9/4/2009 1
  2. 2. TEEB overview 1. TEEB Background 2. The links: Biodiversity, Ecosystems, Functions, Benefits and Value 3. TEEB Phase 1: Results and impacts 4. TEEB Phase 2: Ambitions and working results (from TEEB for Policy Makers)
  3. 3. TEEB overview 1. TEEB Background 2. The links: Biodiversity, Ecosystems, Functions, Benefits and Value 3. TEEB Phase 1: Results and impacts 4. TEEB Phase 2: Ambitions and working results (from TEEB for Policy Makers)
  4. 4. Background: TEEB’s Genesis Potsdam 2007: meeting of the environment ministers of the G8 countries and the five major newly industrialising countries “Potsdam Initiative – Biological Diversity 2010” 1) The economic significance of the global loss of biological diversity In a global study we will initiate the process of analysing the global economic benefit of biological diversity, the costs of the loss of biodiversity and the failure to take protective measures versus the costs of effective conservation.
  5. 5. TEEB’s Goals • Assess and communicate the urgency of action to address ecosystems and biodiversity loss – by presenting the economic, societal and human value of the benefits of ecosystems and biodiversity, and the scale of the benefits lost, • Show how we (can) take into account the value of ecosystems and biodiversity in our decisions and choices, • Address the needs of policy-makers, local administrators, business and citizens (the “end-users”) – interests, opportunities, & responsibilities. Phase 2 (2008-2010): Phase 1 (2007-2008): • Additional analysis within wider • Preliminary scoping work, Valuation framework • Some first analysis, • Broaden the scope of studies (methods; • Clarification as to how to address the ecosystem services (ESS) and biomes) wider goals, • Focus on End-user products • Preliminary identification of experts and • Stronger Involvement from different organisations to contribute experts & organisations Source: adapted from Pavan Sukhdev
  6. 6. TEEB Ambitions 1. Assess and communicate the value of ecosystems and biodiversity – in qualitative, quantitative and monetary forms. 2. Demonstrate the value to the economy, to society/individuals and wider environment – what we have and what we risk losing. 3. Underline the urgency of action and benefits of action 4. Identify / support solutions – new ones (eg REDD), support wider use of good existing tools (eg PES), help make existing tools realise their potential better (eg EIA, Pas); help provide information to reform “bad ones” (eg harmful subsidy reform) 5. Communicate the value to policy makers & implementers, business and citizens & wider policy community - Help ensure that nature / natural capital is taken into account in measurement, analysis, decision making and decisions/choices.
  7. 7. History Lesson: What were the past Losses? Global Forest Area has shrunk by approximately 40% since 1700. [1]. Since 1900, the world has lost about 50%of its wetlands. [2]. Some 20% of the world’s coral reefs have gone [3] In the past two decades, 35% of mangroves have disappeared. [4] Rate of species extinction ~ 100 to 1,000 times > “natural” extinction rate (MA 2005). [1] United Nations Forest and Agriculture Organisation, 2001.Global Forest Resources Assessment 2000; United Nations Forest and Agriculture Organisation, 2006 Global Forest Resources Assessment 2005. [2] http://www.ramsar.org/about/about_wetland_loss.htm [3] Wilkinson C., 2004: Status of Coral Reefs of the World: 2004 report [4] Millennium Ecosystem Assessment, 2005: Global Assessment Report 1: Current State & Trends Assessment. Island Press, Washington DC. Detail: Chapter 19 Coastal Systems. Coordinating lead authors: Tundi Agardy and Jacqueline Alder. Original reference: 35%: Valiela et al. 2001; 80% reference: Spalding et al. 1997
  8. 8. Running down our natural capital The Demise of Global Fisheries 40 % 40 % 20 % 2010 Source: Sea Around Us project
  9. 9. Substitution? We are fishing down the foodweb – D. Pauly (UBC, Canada) Source: L Braat presentation COP9 Bonn May 2008; based on slide by D. Pauly
  10. 10. TEEB overview 1. TEEB Background 2. The links: Biodiversity, Ecosystems, Functions, Benefits and Value 3. TEEB Phase 1: Results and impacts 4. TEEB Phase 2: Ambitions and working results (from TEEB for Policy Makers)
  11. 11. Mapping changes : from Biodiversity & Ecosystems to Economic Values (Human) Drivers Change Change in in Change Economic Natural Land use, in Change Value Drivers Climate, Biodiversity Pollution, In Water use Ecosystem Services Policies Change Nat. Reg. in Loc. Int. Ecosystem functions Source: L. Braat & P. ten Brink (eds.)
  12. 12. Ecosystem Services - The Millennium Ecosystem framework Source: MEA
  13. 13. The link between biodiversity, ecosystems, their services, and benefits to mankind… Maintenance and restoration costs Biophysical Structure of Economic and process social values (& market values) eg 1: woodland Function habitat eg 1: slow eg 2: net primary passage of water productivity) Service eg 2: biomass eg 1: flood prevention eg 2: harvestable Benefit (value) products eg 1: willingness to pay for woodland protection / avoided costs of impacts eg 2: for more woodland harvestable products Source: Building on presentation by Jean-Louis Weber (EEA) presentation at the Workshop: The Economics of the Global Loss of Biological Diversity 5-6 March 2008, Brussels, Belgium
  14. 14. Ecosystem Services across land-uses: Trade-offs of conversion 1natural Climate regulation 2 extensive Climate regulation Food Energy Food Energy Soil Soil protection protection Freshwater Freshwater Climate regulation Landuses within Biome Natural areas Food Bare natural Forest managed Energy Extensive - Intensive Cultivated and managed areas, woody biofuels Cultivated land, grazing area Artificial surfaces and associated Soil protection Freshwater 3 intensive areas Source: Ben ten Brink (MNP) presentation at the Workshop: The Economics of the Global Loss of Biological Diversity 5-6 March 2008, Brussels, Belgium.
  15. 15. Ecosystem services public goods & difficulty of valuation Spiritual & religious ? Economic Aesthetic ? Valuation Flood/Fire ? Difficult or regulation impossible Disease regulation ? Water purification ? Climate regulation ? Freshwater ? Genetic resources ? Recreation & ? tourism Fiber ? Easy Food ? Economic Value ($) Source: Jeffrey A. McNeely, Chief Scientist, IUCN-The World Conservation Union from presentaion: FUNDING MECHANISMS FOR BIODIVERSITY. 27 July 2006 Inter-American Development Bank Workshop on Biodiversity Loss
  16. 16. TEEB overview 1. TEEB Background 2. The links: Biodiversity, Ecosystems, Functions, Benefits and Value 3. TEEB Phase 1: Results and impacts 4. TEEB Phase 2: Ambitions and working results (from TEEB for Policy Makers)
  17. 17. TEEB – Interim Report COP-9, Bonn, May 2008 Economic Size & Welfare Impact of Losses Deep Links with Poverty Discount rates are ethical choices
  18. 18. Biodiversity loss - 1700 to 2050 73% 62% MSA statistics indicate that in the “Policy Inaction” scenario : Global objective (significant reduction in rate of loss) unlikely by 2050 Stricter European goal (halting further loss ) unlikely by 2050 CBD goals (for 2010) unlikely over short term Source: building on Ben ten Brink (MNP) presentation at the Workshop: The Economics of the Global Loss of Biological Diversity 5-6 March 2008, Brussels, Belgium.
  19. 19. The Global Loss of Biodiversity 2000 Source: L Braat presentation COP9 Bonn May 2008 on the COPI Study; building on MNP data
  20. 20. The Global Loss of Biodiversity 2050 Europe – at Risk India - at Risk Africa – at Risk. The World – at Risk. Source: L Braat presentation COP9 Bonn May 2008 on the COPI Study; building on MNP data
  21. 21. Global COPI Loss of Ecosystem services from land based ecosystems Relative to 2000 Relative to 2000 Equivalent to % Area Billion EUR of GDP in 2050 Natural areas -15678 -7.97% Forest managed 1852 0.95% Extensive Agriculture -1109 -0.57% Intensive Agriculture 1303 0.67% Woody biofuels 381 0.19% Cultivated grazing -786 -0.40% World Total -13938 -7.1% Land based ecosystems only The loss grows with each year of biodiversity and ecosystem loss. Source: P ten Brink in L. Braat & P. ten Brink (eds.) 2008 COPI Study for DGENV
  22. 22. (1) Economic size of losses (COPI 1 study) A : 50-year impact of inaction or B : Natural Capital Loss every year ‘business as usual’ Source: Braat & ten Brink (Eds., 2008): Cost of Policy Inaction Welfare losses equivalent Natural Capital Lost : Annually to 7 % of GDP, horizon 2050 EUR 1.35 x 1012 to 3.10 x 1012 (@ 4% (@ 1% Discount Rate) Discount Rate) 3. TEEB Phase 1 results
  23. 23. COPI - Some key results • The welfare loss grows with each year of biodiversity and ecosystem loss. • Over the period 2000 to 2010 this amounts to around 50 billion Euros extra loss per year, every year. • By 2010 the welfare losses from the loss of ecosystem services amount to 545 billion EUR in 2010 or just under 1% of world GDP. • The value of the amount lost every year rises, until it is around 275bn EUR/yr in 2050. • The loss of welfare in 2050 from the cumulative loss of ecosystem services between now and then amounts to 14 trillion (10^12) Euros under the fuller estimation scenario • This is equivalent in scale to 7% of projected global GDP for 2050 – across land-based biomes Source: P ten Brink in L. Braat & P. ten Brink (eds.) 2008 COPI Study
  24. 24. TEEB overview 1. TEEB Background 2. The links: Biodiversity, Ecosystems, Functions, Benefits and Value 3. TEEB Phase 1: Results and impacts 4. TEEB Phase 2: Ambitions and working results (from TEEB for Policy Makers)
  25. 25. TEEB – Final Reports Sep 2009 - June 2010 Science & Economics Foundations, Policy D0 Costs & Costs of Inaction Policy opportunities for D1 National & International Policy-Makers Decision Support D2 for Local Administrators Business Risks D3 & Opportunities Citizen / Consumer D4 Ownership 9/4/2009 25
  26. 26. The Process for TEEB Phase 2 2008 2009 2010 Nagoya, Japan Inputs from Science and Economics experts through the Call for Evidence, participation in Working Groups, etc CBD COP9 - Bonn, Germany Val‘n Framework, Methodologies, Cost Analyses D0 D0 End-User Outreach TEEB for Policy-Makers D1 D1 D2 TEEB for Administrators D2 D3 D4 TEEB for Business D3 CBD COP10 TEEB for Citizens/Consumers D4 Continuous involvement of End-User Groups 9/4/2009 26
  27. 27. The D1 (Policy Level) TEEB Report: D1 Structuring the issues The “wireframe” Ch Title 1 The Biodiversity Policy Challenge 2 Policy Responses: Actors and instruments 3 Measuring to Manage our Natural Capital 4 Evaluation Tools that (can) Integrate the Value of Biodiversity 5 Policies to Reward (unrecognised) Benefits of Ecosystems and Biodiversity 6 Aligning Today’s Subsidies to Tomorrow’s Priorities 7 Policies to Address the Losses of Biodiversity 8 Protecting areas, ecosystems, habitats and species 9 Using the whole Policy Toolkit to address the challenge Structure and content being developed continuously taking into account insights & suggestions – detailed wireframe on http://ec.europa.eu/environment/nature/biodiversity/economics/pdf/d1.pdf 9/4/2009 27
  28. 28. The D1 (Policy Level) TEEB Report: D1 (The “wireframe”) turned into questions Ch Questions being addressed 1 Why is there Urgency for Action to address biodiversity loss? 2 Who can take up the biodiversity challenge; what tools can help ? 3 What should we measure to ensure a proper stewardship of our natural capital? 4 What tools work, what needs and opportunities are there for their use? 5 What policy instruments can help & how to make markets give the right signals? 6 Can we save money and avoid the destruction of biodiversity? 7 What instruments and market signals can help ensure that the polluter pays ? 8 What role do Protected Areas play and how to we help them meet their promise? 9 What package of instruments and responses do we need? 9/4/2009 28
  29. 29. TEEB for Policy Makers Some working recommendations The North has a major responsibility to act and provide resources; the South cannot escape the responsibility of protecting forest and other resources but cannot do so alone. A shared project. Institutions must rise to this; We have limited time; 10 years(?) to reverse trends; Biodiversity must be tackled alongside climate change and the end of poverty in a combined strategy – policy synergies exist (also with water, food); Public investment on a large scale will be needed (PAs, green infrastructure, restoration) New and better working markets are needed 9/4/2009 29
  30. 30. TEEB for Policy Makers Some working recommendations Sector priorities: Fisheries (full scale emergency); Forests (step change needed in concert with climate policy); Agricultural land use (new global approach, including monitoring); Biomass for energy (national & global strategies essential & new realism); Others? 9/4/2009 30
  31. 31. Solutions - areas of focus The cost and price signals in the economy need to reflect the benefits of ecosystems and biodiversity. There are Opportunities for payments to reward benefits of ecosystems and biodiversity (PES, REDD, Markets) Opportunities and needs for reforming subsidies so that they reflect tomorrow’s priorities (fisheries, agriculture, bio fuels et al) Needs for a range of measures to make the polluters pay (legislation, restoration, liability, compensation) Engage the power of the government, consumers and the supply chain (green public procurement, certification) Protected areas (too small, lacking in some zones, lacking in marine area, e.g. usually not well protected – need for designation, funding/investment, management and enforcement. 9/4/2009 31
  32. 32. The D1 (Policy Level) TEEB Report: Chapter 5 Policies to Reward (unrecognised) Benefits of Ecosystems and Biodiversity 1 Introduction 2 Payments for Environmental Services (PES) 3 IPES: REDD (Reduced Emissions from Deforestation and Degradation) & more 4 Access and Benefits Sharing (ABS) 5 Other compensation/financing mechanisms 6 Markets 7 Green public procurement (GPP) 8 Synthesis 9/4/2009 32
  33. 33. PES & REDD Contributions to today’s debate - key points and questions - ESS values and geographic scales - links between the principles of PES and PPP 9/4/2009 33
  34. 34. PES - A set of Instruments to Reward Ecosystems Services: Locally, Regionally and Nationally; but also Globally? Application of PES - dynamic field; diverse tools, diverse challenges, lots of lessons. Where do you see potential to build on existing tools? Needs and Opportunities for IPES– launching new approaches eg REDD Where is there potential for new tools ? Design & implementation What are necessary or enabling conditions to make them work? Different Geographic roles Are some PES for local ESS, other national, others Global? Are there some regions of the world with greater practical potential than others? - for discussion - 9/4/2009 34
  35. 35. Local action leads to local, to national & to global benefits - scope for PES? Mainly local benefit = Local PES? Mainly global benefit = global PES? Biochemicals & pharmaceuticals 5 Climate / climate change Pollination / seed dispersal 4 regulation Water and air purification & 3 Genetic / species diversity waste management maintenance 2 Natural hazards control (fire, 1 Biodiversity flood) 0 Erosion control Ecotourism & recreation Food/Fibre/Fuel Education, art & research Water (quantity) Cultural & amenity values Additional national benefit: national PES?
  36. 36. Payments for Environmental Services (PES) and the Polluter Pays Principle (PPP) Reducing emissions/impacts example farming & PES Zero emissions Zero impact (within assimilative capacity) Costs born by society (env impacts) Environmental target (practical /politically feasible Government pays PES to help env optimum at the time) PES? farmers pay for measures to meeting targets/objectives beyond legislative requirements Legal requirements (“reference level”) Costs of measures borne by farmer – eg Polluter Pays Farmer Economic Principle (partly implemented) Optimum Self-damaging practice (Damage) Costs to farmers No control – “full damage” and society
  37. 37. REDD (Reduced Emissions from Deforestation and Forest Degradation) REDD – An Instrument to Reward the Carbon Storage Function of Forests; and also other Forest Ecosystem and Biodiversity Benefits ? “Global warming may dominate headlines today. Ecosystem degradation will do so tomorrow.” Corporate Ecosystem Services Review, WRI et al. March 2008 Can REDD address them both? 9/4/2009 37
  38. 38. D1: REDD Working key Messages REDD and Biodiversity - Synergies in both directions How to capture the synergies? What are the scale of benefits in both directions? REDD in the Context of the Conventions - UNFCCC and UNCBD (CBD) – policy process realism How to make it happen institutionally? REDD Benefits to Biodiversity and Ecosystems; yet also Risks – results realism What are the key risks, how can they be avoided? Design and implementation – making it work What is needed to make it work? - for discussion - 9/4/2009 38
  39. 39. PES instruments and ESS - potential for the future? -for discussion Ecosystem service “Today” Future Provisioning services $$$$$$ $$$$$ Fibre / materials, e.g. timber et al $$$$$$ (Timber) $$$$$ (FSC or equiv.) Natural medicines $ (biotrade) $$$ (biotrade) Biochemicals & pharmaceuticals $$ $$$ (ABS) Water provision (quantity) $ (PES) $$$$ (PES) Cultural & social services $$$ (tourism et al) $$$$ (tourism et al) Regulating services $ $$$$$ Climate / climate change regulation - $$$$$ (REDD, PINC) Water regulation / purification (quality + risks) $ (PES) $$$$ (PES, IPES) Air quality regulation - $$$ (direct investment) - $$$ PES Ag Erosion control Dir. investment ? Genetic / species diversity maintenance inc. endemic $ (investment seed banks) $$ ? breeds and varieties Aggregate – as a whole Protected Areas $$ (dir. investment) $$$$ (+PES?) Biodiversity rich agriculture $$$ (PES) $$$$ (PES) Provisioning service led values Greater balance across services Synthesis Existing Markets PES creates new markets
  40. 40. Thank You & looking forward to your questions and feedback & also your presentations on PES/REDD! Patrick ten Brink ptenbrink@ieep.eu not-for- IEEP is an independent, not-for-profit institute dedicated to the analysis, understanding and promotion of policies for a sustainable environment in Europe 9/4/2009 40
  41. 41. Thank You! • Further information and Call for Evidence: www.teebweb.info • Contact Scientific Coordination: teeb@ufz.de • TEEB for Policy Makers: ptenbrink@ieep.eu • Further contributors: 41
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