Potential for Payments for Ecosystem Services in UK Uplands


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Presentation given as part of DEFRA workshop for project on "Opportunities and Barriers to Payments for Ecosystem Services", which is feeding into the development of the Government's forthcoming White Paper on the Natural Environment

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Potential for Payments for Ecosystem Services in UK Uplands

  1. 1. Potential for PES in the uplands Mark Reed
  2. 2. Plan <ul><li>Upland ecosystem services </li></ul><ul><li>Opportunities and barriers for PES in uplands </li></ul><ul><ul><li>Focus on carbon </li></ul></ul><ul><ul><li>Considering water quality and other ecosystem services </li></ul></ul>
  3. 3. A land of many uses The Future?
  4. 4. Opportunities for PES <ul><li>Climate regulation through carbon sequestration and storage in peat soils </li></ul><ul><li>Regulation of water quality </li></ul><ul><li>Regulation of flood risk </li></ul><ul><li>Regulation of wildfire risk </li></ul><ul><li>Cultural ecosystem services </li></ul>
  5. 5. 1. Climate regulation <ul><li>Potential to enhance this service: </li></ul><ul><li>UK’s largest carbon store </li></ul><ul><li>Losing carbon from degraded peatlands </li></ul><ul><li>Restoration can stem loss & absorb carbon </li></ul><ul><li>Short-term CH 4 problem, long-term GHG benefit </li></ul><ul><li>Co-benefits </li></ul>
  6. 6. Market demand <ul><li>Market demand estimated between 1-10M tonnes carbon reduction p.a. (BRE, 2009) </li></ul><ul><li>Companies and individuals </li></ul><ul><li>Companies interviewed more interested in CSR than tradable credits </li></ul><ul><li>Pay premium for UK-based carbon from land-based project that has co-benefits </li></ul><ul><li>Must meet rigorous, recognise standards </li></ul>
  7. 7. Supply <ul><li>Many land owning organisations want to restore damaged peatlands but do not have the means </li></ul><ul><li>Keen to use private investment </li></ul><ul><li>For example: </li></ul><ul><ul><li>National Trust, Country Land & Business Association, National Park Authorities, AONBs </li></ul></ul>
  8. 8. Intermediaries <ul><li>Many exist and have expressed an interest in carbon sequestration in peatlands </li></ul><ul><li>Need cost-effective verification and some form of accreditation </li></ul><ul><ul><li>e.g. Voluntary Carbon Standard (VCS) </li></ul></ul>
  9. 9. Barriers <ul><li>May not be possible to satisfy additionality criteria to access voluntary carbon markets </li></ul><ul><ul><li>Peatland restoration in RDPs </li></ul></ul><ul><li>Accessing compliance carbon markets under Kyoto would require legislative changes at UK and EU levels </li></ul><ul><li>To count towards Government commitments under Kyoto and domestic climate legislation, all peatlands need to be counted in GHG inventory </li></ul>
  10. 10. One way around this... <ul><li>CSR scheme: private investment in restoration </li></ul><ul><li>Co-ordinate/integrate with existing schemes? </li></ul><ul><ul><li>UELS, Glastir </li></ul></ul><ul><li>Conservative analysis: carbon payments could subsidise restoration options by around 20% </li></ul><ul><ul><li>In some cases, could completely pay for options or generate surplus </li></ul></ul><ul><ul><li>Depends on carbon price & restoration costs/access </li></ul></ul><ul><li>If in GHG inventory, CSR scheme (no tradable credits) counts towards legislative targets </li></ul>
  11. 11. One way around this... <ul><li>GHG Accounting Guidelines allow UK companies who have reduced emissions at source to become carbon neutral via offsetting </li></ul><ul><li>Consultation on a UK forest carbon code </li></ul><ul><li>Worth consulting on a peatland code? </li></ul><ul><li>Initial work done to outline technical, legal, financial and organisational design of code </li></ul><ul><li>If consistent with VCS requirements, voluntary carbon markets remain future option </li></ul>
  12. 12. 2. Regulation of water quality <ul><li>Land management (including restoration) can reduce DOC and POC </li></ul><ul><li>Benefits for water companies </li></ul><ul><li>United Utilities (paid by OFFWAT) already paying for WQ via land managment </li></ul><ul><li>Interest varies between companies </li></ul><ul><ul><li>Those without major DOC problems not interested </li></ul></ul><ul><ul><li>Those who perceive WQ legal responsibility of land managers under WFD won’t pay people to keep law </li></ul></ul>
  13. 13. 3. Regulation of flood risk <ul><li>Evidence that restoration reduces steam peakflow and hence may reduce downstream flood risk </li></ul><ul><li>Effect is short-lived and once the capacity of the soil to store water has been reached (e.g. following a heavy storm), restoration has little effect on flood risk </li></ul>
  14. 14. 4. Regulation of wildfire risk <ul><li>Restoration raises water table </li></ul><ul><li>Reduces risk of wildfires burning deep into peat </li></ul><ul><li>No market for wildfire risk regulation, but may contribute towards the attractiveness of PES schemes based on carbon or water </li></ul>
  15. 15. 5. Cultural Ecosystem Services <ul><li>Hard to monetarise, but options emerging </li></ul><ul><li>Visitor payback </li></ul><ul><ul><li>“ Our Man at the Top”: £50K from £2 accommodation surcharge in the Lake District </li></ul></ul><ul><li>Spatial planning approaches </li></ul><ul><ul><li>Section 106 agreements/CIL </li></ul></ul><ul><li>Habitat banking: biodiversity credits to offset impacts of development </li></ul><ul><ul><li>Like for like under Habitats/Birds Directives </li></ul></ul><ul><ul><li>Given upland designations, unlikely to be significant </li></ul></ul>
  16. 16. Conclusion <ul><li>PES by water companies happening already </li></ul><ul><li>Possible to overcome carbon scheme barriers? </li></ul><ul><li>Markets for cultural services at early stage of development, no markets for wildfire regulation </li></ul><ul><li>Bundling co-benefits with carbon and/or water may increase the attractiveness/value of carbon/water schemes </li></ul>