jp8589 WRI.qxd - World Resources Institute

CHAPTER 4
FOUR STEPS TO ENVIRONMENTAL INCOME
TABLE 4.2 PAYMENTS FOR ENVIROMENTAL SERVICES
Locale
Costa Rica
Pimampiro, Ecuador
Cauca Valley, Columbia
Kerala, India
Botswana, Kenya,
Namibia, South Africa,
Tanzania, Zimbabwe
Scholel Té, Chiapas, Mexico
Enviromental Service
Forest conservation and
reforestation for watershed
maintenance and carbon storage
Forest protection of headwaters to
ensure clean water supply for the town
Forest management to improve
stream flows and reduce sedimentation
of irrigation canals
Discovery and maintenance of a
continued supply of Jeevani, a
commercially marketed medicine
Support of ecotourism in southern
and eastern Africa through the maintenance
of landscapes, natural
resources, and wildlife habitat
Forest management leading to carbon
sequestration
Value to Community
More than US$100 million disbursed under 10-15 year contracts with over
450,000 ha enrolled in program. Funded by a fuel tax and contributions from
private companies.
Rodriguez 2004
$1 per hectare payments constitute 30% of income for those households
participating in forest protection.
Grieg-Gran and Bishop
US$1.5 million invested in poor communities in the upper watershed by
downstream farmers.
Scherr et al. 2004
500-1000 families will earn wage income from cultivation and harvesting of
the fruit and leaves that are used to manufacture the drug. Ongoing royalty
payments to the community from drug sales.
Landell-Mills and Porras 2002
Direct employment of 3000 people; over US$100,000 reinvested in local
economic development and conservation activities.
Landell-Mills and Porras 2002
Two-thirds of the value from the sale of carbon contracts goes to farmers. In
2002, US$120,000 was distributed to 700 participants.
IUCN 2003
ecosystem services have a quantifiable economic value. If people
downstream are being regularly flooded, the ability of the intact
forest to moderate stream flows and lessen the flood risk will be
worth something to them, and they may be willing to pay the
upstream forest owners to preserve and protect this service—or
even to restore it.
In the last decade or so, markets based on this kind of interchange—called
payment for environmental services (PES)—have
begun to develop worldwide. (See Table 4.2.) The most
common environmental services marketed so far have been
associated with forests and fall into four categories: watershed
services like those described above, carbon storage, biodiversity
conservation, and preservation of landscape beauty. Since the
poor are the stewards of many rural ecosystems, it makes sense
that they should be able to tap these payments for environmental
services (PES) as an additional source of environmental
income—another element of their “nature portfolio.” In a few
cases, they have been successful in doing so. But for the most
part, the markets for environmental services, which are still in
their infancy, do not yet serve the poor well.
Deals involving PES range in scale from local to international
and are undertaken by a range of actors, including private
companies, NGOs, communities, and state governments. Private
businesses that depend on natural resources are sometimes
willing to pay for protection of ecosystems, usually following
signs that a resource is threatened or already in decline. In one
promising example in Colombia’s Cauca Valley, downstream
sugarcane growers hurt by flooding paid upland communities—
predominantly poor—to change their land management
practices to protect the watershed. This evened out the water
supply on the valley sugarcane farms and reduced crop damages,
while bringing public benefits—clean water supply, sanitation,
and other economic development projects—to the upland
communities. (See Box 4.4.)
Payments for preserving biodiversity and landscape
beauty often come from conservation NGOs or local businesses
involved in ecotourism. For example, Rainforest Expeditions, a
private company in southeastern Peru, signed a 20-year agreement
with the local Infierno community, splitting profits and
management of the business in return for preservation and
access to the forest and wildlife on the community’s lands
(Landell-Mills and Porras 2002:166).
Governments often act as originators or participants in
PES schemes. In 1996 the Costa Rican government became a
leader in PES when it established the first national program to
dispense payments to farmers willing to maintain or restore
forest ecosystems and their services. The program pays
landowners to reforest their lands or conserve forest lands they
already own, rather than convert them to pasture. By 2004,
more than 450,000 hectares were included in the program, and
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