Pavan Sukhdev Gives Annual Darwin Initiative Lecture

Pavan Sukhdev, leader of the TEEB review (The Economics of Ecosystems and Biodiversity), yesterday delivered the 9th annual Darwin Initiative Lecture in London.

The central theme of Mr Sukhdev's presentation was the need for a 'new economics' to take into account measures of human progress traditionally excluded from nations' GDP figures. He gave the example of India, with newspaper headlines currently proclaiming 9% GDP growth, despite the global economic downturn. Mr Sukhdev challenged this figure: did this equate to a 9% increase in the quality of healthcare delivered for the population, for example? A quote from a leading economist, taken in 1968, stressed that "GDP is unfit for purpose"; Mr Sukhdev argued that nothing had changed in this respect.

The example of Yasuni National Park, Ecuador, ilustrated the possibilities offered by removing 'public goods' from the public domain and so avoiding the so-called 'Tragedy of the Commons'. Ecuador has pledged not to exploit the 20% of its proven oil field found within the national park, calculating a £1.6 billion opportunity cost for not doing so, and pricing the carbon it will have 'locked in' the oil field at £1.7 billion, based on the market rate for carbon. Ecuador is currently seeking investors under this REDD (Reduced Emissions from Deforestation and Degradation) initiative. The investment will allow the country to spend on renewable technologies, shifting away from oil dependence, and be channelled into communities for an improvement in the population's quality of life.

Breakout groups followed the lecture, considering the next stages of the TEEB review. It was clear from discussion that, in order to mainstream valuation of ecosystem services and 'natural capital' into decision making, the results of the review must be considered not just by countries' environment ministries but by their treasuries, and by the World Bank. Over the next few months the TEEB team will be seeking input into their review, in the form of evidence, and further suggestions for influencing policy-makers.

For more information see: http://ec.europa.eu/environment/nature/biodiversity/economics/

"It's the ecology, stupid"...

It's not the economy, but ecology which is the key to the survival of the human species, stated Sir John Harman, Chairman of the Environment Agency, in his closing remarks to the IEEM summer conference, attended by the BES's Policy Team. Sir John called for a 'new economics' to tackle the tough environmental challenges we face today. He also urged greater collaboration between ecologists and economists and stressed the importance of ecologists engaging with policy-makers.

The theme of the conference was "Moving to an Ecological Economy", with speakers discussing how ecology can drive the valuation of biodiversity and natural resources:

Peter Head, a Director of ARUP, outlined his work with the company in developing Dongtan, an innovative new eco-city to be built in China, on an island north of Shanghai. The first phase of construction will be completed in 2010, and when Dongtan is finished it will provide sustainable, 'green' homes for 80,000 people. Just some of the exciting measures to be adopted in the city include the use of used rice husks to power a Combined Heat and Power (CHP) plant, widespread use of photovoltaic cells to harness energy from the sun, the use of anaerobic digesters to process all biological waste and extensive food production within the city to compensate for the land lost through the building of the development.

Peter highlighted the work of ARUP in creating pilot schemes for public-private partnerships, which he hopes will lead to street by street transitions to sustainability and 'one planet living' at, at least initially, a regional scale.

Shulamit Alony, Business and Biodiversity Officer at the Countdown 2010 initative, developed by the IUCN, outlined the work of Countdown 2010 in encouraging Governments to increase momentum towards the CBD target. Countdown 2010 has also been working with industry to 'green' their activities, working with both multi-national companies and small and medium enterprises across Europe whose activities either impact on biodiversity or depend directly on biodiversity for their profits.

David Calpin, Defra's head of strategy in the Natural Environment division, outlined the shift in thinking at Defra towards a holistic whole ecosystems focus, discussing the Ecosystem Approach Action Plan.

Dr Mike Christie, University of Aberystwyth and Salman Hussein, Scottish Agricultural College, discussed separate studies they have undertaken for Defra to put a value on ecosystem services. Dr Christie has undertaken on valuing the Biodiversity Action Plan (BAP), whilst Salman Hussein has explored different scenarios for conserving biodiversity as proposed by the Marine Bill. Salman's team have developed a methodology to quantify the economic costs and benefits of implementing Marine Protected Zones as either 'Highly Restricted' or 'Maintenance of Conservation Status', under which different levels of potentially damaging activities would be allowed by the Marine Bill.

Overall, the message to emerge from the day was that innovative work was being undertaken by environmental economists, and by others in the economics and ecological communities in this area. Yet, putting a value on biodiversity and ecosystem services is never going to be simple and much more work is required in order for HM Treasury to take the Ecosystem Approach seriously. The Economics of Ecosystems and Biodiversity Review (TEEB) Review, being conducted at EU level, could provide a powerful tool to force the Government to recognise the true cost to the UK of failing to halt biodiversity loss.

Stern Warns that Climate Change Worse Than Feared

Sir Nicholas Stern has warned that his 2006 review of the economics of climate change has underestimated the risks posed by accelerating global warming. Speaking this week and reported in the Guardian today, Stern said that new scientific findings showed greenhouse gas emissions were are causing more damage than was understood in 2006, when he prepared his highly influential report. Stating that "emissions are growing much faster than we thought, the absorptive capacity of the planet is less than we thought [and] the risks of greenhouse gases are potentially bigger than more cautious estimates", he called for increasing commitments from countries to cut emissions of greenhouse gases to be translated into action.

Original article: "I underestimated the threat, says Stern", The Guardian, 18 April 2008
(with audio to accompany the story)

A New Model for Investment in Ecosystem Services

A deal between two environmental organisations could provide a blueprint for investment to conserve the world's vital ecosystem services. Canopy Capital, an environmental investment and development company, has struck a deal with Iwokrama International Centre for Rainforest Conservation and Development which owns a one million acre area of rainforest in Guyana. Canopy Capital will pay Iwokrama for the ecosystem services generated by the rainforest, including those supporting and regulating services which are often viewed as unquantifiable, such as water storage and climate regulation.

In return for its investment, Canopy Capital will receive a percentage of any income that might one day be made by the rainforest’s ecosystem services. The company hopes that the services will one day become tradeable commodities. Once the organisation has re-couped its investment, 80% of further profits will go back to the reserve to allow Iwokrama to carry out its activities.