Benefit transfer ecosystem services valuation of the mining area

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Economic valuation study on biodiversity, Mt. Hamiguitan, Philippines by Roy G. Ponce, royg.ponce@gmail.com

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Benefit transfer ecosystem services valuation of the mining area

  1. 1. Benefit-Transfer Ecosystem Services Valuation of the Mining Area in Mt. Hamiguitan Ranges and its Environs Ponce, R. & Tabora, J.
  2. 2. Rationale <ul><li>Failure to account for the natural ecosystem services in any benefit-cost exercise of an economic activity may undervalue or even neglect the said services to the point of compromising sustainability of humans in the biosphere. </li></ul>
  3. 3. Rationale <ul><li>Mt. Hamiguitan, a tropical mountain range in Southeastern Philippines is rich in biodiversity and mineral resources. But it is confronted with ecological and economic issues over an approved mining area of significant scale relative to the remaining forest cover of the mountain range (57% of Mt. Hamiguitan area). </li></ul>
  4. 4. Objective <ul><li>This paper tries to establish information on the value of the Mt. Hamiguitan ecosystem services that maybe reduced or lost when renewable ecosystem services are compromised in favor of extracting non-renewable mineral resources. </li></ul>
  5. 5. Conceptual Framework Holistic Benefit-Cost Analysis Economic Efficiency & Equity Economic Value of Ecosystem Services Benefit Transfer Valuation Biodiversity Research
  6. 6. Methodology <ul><li>This study uses the benefit value approach (Pattanayak, Smith & Van Houtven, 2003) using single point estimates by a synthesis of valuation studies done by Constanza et al in 1997 </li></ul><ul><li>Uses Constanza et al (1997) estimates of ecosystem services </li></ul>
  7. 7. Methodology <ul><li>The following steps were undertaken in this benefit value approach: </li></ul><ul><li>Identification of existing studies where the benefit has been estimated; </li></ul><ul><li>Identification of the resource and relevant values to be applied; </li></ul><ul><li>Substitution of the values to calculate benefits; </li></ul><ul><li>and calculation of the present value. </li></ul>
  8. 8. Limitations <ul><li>Credibility of Constanza et al (1997) estimates </li></ul><ul><li>No information as to the health status of ecosystems when the estimates were derived </li></ul>
  9. 9. Results and Discussions
  10. 10. Table 1 Ecosystem Services Aesthetic information** Recreation Cultural and artistic information** Spiritual and historic information** Science and education** Information Functions Food production Raw materials Genetic resources Medicinal resources* Ornamental resources* Production Functions Refugia Nursery Habitat Functions Gas regulation Climate regulation Disturbance prevention Water regulation Water supply Soil retention Soil formation Nutrient regulation Waste treatment Pollination Biological control Regulation Functions Ecosystem Service Primary Category
  11. 11. Table 2 Summary of global value of annual ecosystem services grouped by primary category as applicable to Mt. Hamiguitan and its environs 8,498 20,945 230 567 41 101 - 8,227 20,277 Lakes/Rivers 9,990 24,624 658 1,622 628 1548 169 417 8,535 21,037 Mangroves 244* 601 2 5 67 165 - 175 431 Grass/Rangelands 2,008** 4,949 114 281 388 956 - 1,506 3,712 Tropical forest 6,076** 14,975 3,009 7,416 247 609 7 17 2,813 6,933 Coral reefs 19,004 46,840 - 2 5 - 19,002 46,835 Seagrass/Algae beds 22,832 56,276 410 1,011 546 1,346 131 323 21,745 53,596 Estuaries Total Value Information Function Production Function Habitat Function Regulation Function Average Ecosystem Services per Hectare per Year in 1994 US$ and 2010* US$ Biome
  12. 12. Table 3 Mt.Hamiguitan Ecosystems
  13. 13. Table 4 Valuation of Ecosystem Services of Mt. Hamiguitan Mining Area and its Environs by Primary Function in 2010 US$
  14. 14. Other Studies (Coral Reefs) <ul><li>US$ 4,238 (Economic Value of Corals, 2008) </li></ul><ul><li>US$ 15,118 (Seenprachawong, 2004) </li></ul><ul><li>US$ 14, 975 (This Study) </li></ul>
  15. 15. No Estimates <ul><li>Sandy Floor </li></ul><ul><li>Crop lands </li></ul><ul><li>Habitat Function </li></ul><ul><ul><li>Seagrass </li></ul></ul><ul><ul><li>Seaweeds </li></ul></ul><ul><ul><li>Tropical Forests </li></ul></ul>
  16. 16. Discussion Points <ul><li>US$ 88.6M/year of the 18,000 hectares is a floor estimate </li></ul><ul><li>An underestimate </li></ul><ul><li>How would it fare to mining income projection? </li></ul><ul><li>Tangible value vs intangible value (incentives approach) </li></ul><ul><li>How do we estimate ‘habitat function’? </li></ul>
  17. 17. Conclusion <ul><li>The total value of ecosystem services of Mt Hamiguitan and its environs, across 21,941 hectares in 2010 US Dollars per year amounts to US$88,657,479.00. </li></ul><ul><li>This estimate accounts 79% for regulation function value, 13.5% for production function value, 1% for habitat function value, excluding most of the ecosystem areas, and 7% information function value. </li></ul>
  18. 18. Conclusion <ul><li>This value can be set as the minimum value of Mt. Hamiguitan ecosystem services. </li></ul><ul><li>This value represents the ‘forgone’ or ‘reduced’ benefits once mining activities are in full operation. </li></ul><ul><li>It is the regulation function of the ecosystem services which will be directly affected once mining operations are made. </li></ul>
  19. 19. Conclusion <ul><li>These values are underestimates since some ecosystem are not valued including the infrastructure value of the entire ecosystem. </li></ul><ul><li>The habitat function being the least valued need further study specially on the values of endemic and rare species. </li></ul>
  20. 20. Conclusion <ul><li>These values can serve a basis for studying the possible loss or reduction made on the ecosystem once compromised. </li></ul><ul><li>These could also represent the minimum replacement value if the ecosystem services lost be reconstructed or restored once damaged </li></ul>
  21. 21. Recommendations <ul><li>Estimate habitat function value using proxy secondary data on existing conservation cost of rare and endangered species. (e.g. Philippine eagle, tarsier & butterflies) </li></ul><ul><li>Update calculation of estimate on crop lands. </li></ul><ul><li>Need of robust biophysical data as estimation basis </li></ul><ul><li>Possible Journal Publication (Asian Journal of Biodiversity) </li></ul>
  22. 22. Thank You

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