Presentation by Prof Mark Reed to DICE (University of Kent), 3rd December 2016

1. Prof Mark Reed
Birmingham City University
Research Manager, IUCN UK Peatland Programme
Payments for Ecosystem Services:
A Place-Based Approach

2. Introduction

3. The problem

4. 2 What are our options?
 Nationalisation of land
 Information provision and capacity building
 Regulation
 Financial mechanisms
 Creation of new markets

5. What are our options?
 Nationalisation of land
 Information provision and capacity building
 Regulation
 Financial mechanisms
 Creation of new markets

6. Payments for Ecosystem Services
 A voluntary transaction where
 A well-defined ecosystem service (or land use
likely to secure that service)
 Is being “bought” by a (minimum one)
ecosystem service buyer
 From a (minimum one) ecosystem service
provider
 If and only if the ecosystem service provider
secures provision (conditionality)

7. Who should pay?

8. Putting a price-tag on nature?

9. Problems with PES
 How do you (cost-effectively) quantify the
ecosystem service benefits?
 How do you attribute ecosystem service
enhancements in complex systems where their
delivery is influenced by many factors?
 How do you prevent markets for one ecosystem
service compromising other services?
 Main approach to date: bundling and layering

10. Bundling and layering

11. Problems with bundling/layering
 Tend to target single habitats (ignore
interactions between wider ecosystems and
underplay role of cultural ecosystem services)
 Pay little attention to governance of ecosystem
services in complex social-ecological systems
 To be robust, PES schemes need multi-level
governance, based on a better understanding of
social dynamics and shared, cultural values
associated with habitats and ecosystem services

12. Bundling and/or
layering of the
widest possible
range of ecosystem
services over
multiple spatial and
temporal scales in
the same location
Multi-level
governance
mechanisms
Prices that reflect
the shared values
of multiple
ecosystem service
beneficiaries
A place-based approach to PES

13. Case Study

15. Approach
Deliberative, non-monetary
valuation with the development
of multi-level governance
mechanisms, including new
methods for monitoring and
verifying ecosystem service
delivery

16. Elicitation process
Deliberated values
Non-deliberated values
Value intention
Other-
regarding
values
Self-regarding
values
Value
dimensions
Value scale
Value to
society
Value to
individual
Value concept
Transcendental
values
Contextual
values
Value
Indicators
Value provider
Societal & cultural
values
Communal
values
Individual
values
Group
values

17. Deliberative value formation model

18. Phases
Phase 1 Underpinning
research
Phase 2 Piloting
Phase 3 Code
development

19. Phase 1: underpinning research
 Market research (interviews with businesses) & draft UK Code
 Analysis of international cases, to develop PES Best Practice Guide
 24 ecosystem service beneficiary interviews from selected sectors
 2 workshops & comparative analysis of pilot Peatland Code &
MoorFutures
 Stakeholder workshop & fieldwork with Local Nature Partnership to
develop a place-based approach for South Pennines
 Interviews with visitor giving schemes across the UK, with case
study research in Lake District National Park leading to phone apps
 Economic assessment of Code leading to project feasibility tool
 Emissions factors to cost-effectively monitor GHG emission
reductions from restoration projects

20. Phase 2: piloting
 Piloting with project developers: pilot restoration
and research projects in North Pennines,
Exmoor, Lake District and South Pennines, and
Peatland Action in Scotland. Field protocol for
assessing GHG emission reductions trialled in
further 22 sites
 Piloting with landowning community: 5 focus
groups with landowners and other stakeholders
 Piloting with the business community through
events organised by IUCN UK Peatland
Programme

21. Phase 3: Code development
 Governance structures: to oversee the operation
of the Code
 Peatland Restoration Handbook
 The UK Peatland Code 1.0 and final draft of the
Project Design Document were launched at the
World Forum on Natural Capital in Edinburgh, in
November 2015

22. Bundling and/or
layering of the
widest possible
range of ecosystem
services over
multiple spatial and
temporal scales in
the same location
Multi-level
governance
mechanisms
Prices that reflect
the shared values
of multiple
ecosystem service
beneficiaries
Findings

23. Findings
 Supply side:
 Complementary ecosystem services and trade-offs
associated with peatland restoration
 Interest from many stakeholders in layered schemes
that target payments for different ecosystem services
from different beneficiaries
 Bundled approach more realistic and likely to avoid
tradeoffs
 Potential to integrate payments for cultural services
via visitor giving schemes

24. Helping walkers and cyclists learn about
nature – and pay for it

25. Findings
 Initial business survey: limited awareness and
immediate opportunities (passing the buck down
the supply chain), local authorities more likely to
be sellers/intermediaries than buy on behalf of
taxpayers
 Market research for a peatland scheme: niche
but strong demand
 Result: water company funding for pilot phase,
launched Peatland Code 1.0 with initial
investment from a multinational

26. Bundling and/or
layering of the
widest possible
range of ecosystem
services over
multiple spatial and
temporal scales in
the same location
Multi-level
governance
mechanisms
Prices that reflect
the shared values
of multiple
ecosystem service
beneficiaries
A place-based approach to PES

27. Findings
 Highly dependent on institutional capacity of
local actors
 NGOs more likely to benefit in early phases
 Working with Welsh Government to open up to
commoners
 Developed methods for practitioners to cost-
effectively and easily monitor GHG emission
reductions

34. Bundling and/or
layering of the
widest possible
range of ecosystem
services over
multiple spatial and
temporal scales in
the same location
Multi-level
governance
mechanisms
Prices that reflect
the shared values
of multiple
ecosystem service
beneficiaries
A place-based approach to PES

35. Findings
 Social valuation of ecosystem services can help
quantify cultural and social value/impacts of
changes in ecosystem services arising from
restoration
 Impacts on production
(way of life?)
 Cultural benefits e.g.
aesthetics, access,
recreation

36. Findings
 A sense of duty and responsibility:
 “This is all about custodianship…It’s all about
sustainability. It’s about handing over something in a better
state than what you were lucky enough to get it at.”
(Cairngorms, storyteller 1)
 “You never become an estate owner through financial
reasoning…I think we are just stewards and passing
through and doing the best we can in many ways.”
(Dumfries, storyteller 2)
 “I do feel I am probably a better steward than a public
organisation because I have a heart, I have a stake in it.”
(Thurso, storyteller 2)
 “Because I’ve been there a long time, so know how it
changes. I’ve seen it for a long time now.” (Thurso,
storyteller 2)

37. Findings
 A sense of achievement, self-respect and belonging:
 “The hills have to have sheep, because this is the one and only
place where you find the Shetland sheep.” (Shetland, storyteller
1)
 “Shetland men have sheep.” (Shetland, storyteller 2)
 “The first time I went I was 1 year old. My mother had been going
since she was 11. In family terms, there’s a certain responsibility
over the years.” (Dumfries, storyteller 1)
 “I can see five kingdoms from up there… To be master of all you
survey is a wonderful thing.” (Dumfries, storyteller 1)
 “I love creating all the different habitats.” (Dumfries, storyteller 2)
 “You’ve got to understand a bit how it developed, why it looks
like that…how it got there and how old it is…you’ve got to have a
perception of that before you can appreciate them fully.” (Thurso,
storyteller 1)

38. Findings
 Concerns over threats to traditional way of life
 Managed burning and grouse in the Peak District
 Peak District burning
premium: example of
transcendental values
being reflected in fair
price negotiation

39. Findings
 Fair prices:
 Deliberated fair price ranged from £11.18 per tonne of
CO2 equivalent in Dumfries to £15.65 per tonne in
Thurso, with substantially higher prices reached in the
Peak District of £54 and £107 per tonne for
revegetation and ditch blocking respectively
 Additional payment sought by landowners, after
meeting the costs of restoring peatland under the
Code, was £2 per tonne of CO2 equivalent generated
through restoration in Thurso, £3 per tonne in
Dumfries and the Cairngorms, £3.50 per tonne in
Shetland and £4.30 per tonne in the Peak District

40. Conclusions

41. Benefits of place-based approach
 Co-ordinate delivery of ecosystem services between
different ecosystems and habitats to minimize
ecosystem service trade-offs
 Social valuation of ecosystem services, using a
structured, deliberative approach has the potential to
engage with and empower diverse stakeholders in the
design and governance of PES schemes

42. Benefits of place-based approach
 Monitoring and verification can engage empower
landowners and managers to monitor ecosystem
services, providing important feedbacks to sustainable
land management
 By eliciting a broader range
of shared values, including
transcendental values, it is
possible to better capture
cultural ecosystem services
and deliver value from PES to
a wider range of stakeholders
(not just buyers and sellers)

43. Challenges
Incompatibilities
with landowner
objectives
High perceived
risks among
sellers
Lack of business
awareness
Quantifying
biodiversity co-
benefits
Barriers to
collaboration
across property
boundaries

44. Future research
 Research challenges:
 Developing cost-effective
monitoring
 Understand & overcoming
barriers to collaboration for place-based PES
partnerships
 Different sellers have different motives, perceptions of
risk and values

45. Future policy
 Policy challenges:
 Integrating schemes for
multiple habitats and services:
a role for Government?
 Need to integrate public & private PES
 Opportunities: shrinking CAP
 Challenges: incompatible timescales?
 Social justice concerns: PES for commoners?

46. Find out more
www.profmarkreed.com
Twitter: @profmarkreed