Valuation of Biodiversity Benefits (OECD)

2) Service capacity sub-indexIndicators of landscape conditions that limit or enhance the level of services expected perunit of function.3) Service value sub-indexIndicators of local, regional, and national supply and demand conditions, individual andcommunity preferences, and the substitutability and replaceability of the service which reflect theexpected value per unit service.4) Service risk sub-indexIndicators of the likelihood of future disruptions in service flows that affect the value ofexpected ecosystem services. These are related to the exposure and vulnerability of the site or othercritical landscape features to such threats as floods, droughts, fire, disease, infestations, waterdiversion, pollution, and industrial development.Flow of Indicator DevelopmentThe flow of indicator development using site capacity indicators and the four sub-indiceslisted above is displayed in Figure 7.4. The initial assessment of the site’s functional capacity can beexpressed using any of the biophysical ecosystem assessment methods and ecosystem conditions withrespect to particular functions. 40 A recent paper Bartoldus (1999) describes approximately 30ecosystem assessment methods that generate “functional capacity indicators” or “habitat suitabilityindicators”. 41 The sub-indices listed above are then used to adjust site indices of functional capacity toreflect how landscape factors influence expected levels of service, value, and risk. If necessary the“adjusted service value” estimates associated with each function can be weighted using servicepreference weights and aggregated to form a single overall value index.The details of how individual sub-indices are developed are provided in the last section ofthis paper. The following section provides an illustration showing how the indicator system can beused to assess wetland trades.Illustrations of Indicator ApplicationsWetland trading: For illustration, assume that each of the four sub-indices listed above isdesigned to range around a mean or average value of one. At a site in a landscape context that is4041The review of ecosystem assessment methods provided in Bartoldus (1999) provides evidence thatmost of them focus on site conditions and ignore landscape linkages. They establish the capacity of anecosystem site to provided functions, not the opportunity the ecosystem site has to provide functions,and usually do not address landscape factors that link biophysical functions with services that matterto people.Most “functional capacity indicators” and habitat suitability indicators” range from zero to one withzero representing no functional capacity and one representing a high level of functional capacity.Several recent methods rely on high quality specimens of an ecosystem as a reference to establishbenchmark indicator values, which are then used to rank other sites. See the description of the“hydrogeomorphic”(HGM) wetland assessment method in Brinson, et al (1993).135