The Economics of Restoration: Costs, benefits, scale and spatial aspects
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Transcript of The Economics of Restoration: Costs, benefits, scale and spatial aspects
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The Economics of Restoration: Costs, benefits, scale and spatial aspects
Bernardo BN Strassburg Agnieszka E Latawiec
Global Landscape Forum, 2013
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Structure
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape
Introduction
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Structure
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape
Introduction
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115 million hectares
The Atlantic Rainforest Biome
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Less than 14% of original forest remains
Less than 8%, if only fragments > 100 ha.
45% of species under risk of extinction due to Climate Change
70% of Brazilian GDP
2/3 of Brazilian Population
250 mammals (22% endemic)
340 amphibians (26% endemic)
197 reptiles (30% endemic)
1,023 birds (18% endemic)
More than 20,000 vascular plants
World record of tree species per hectare (458, ac. NYBG)
About 7% of global biodiversity
Source: Conservation International
The Atlantic Rainforest Biome
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(William F. Laurence, 2009)
The Atlantic Rainforest Biome
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Structure
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape
Introduction
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Our goal, our challenge: Restoration of 15 million
hectares by 2050
Through: • Protection and restoration of ecosystem services • Legal compliance of agribusiness and food production • Job and income generation for local communities
The Atlantic Forest Restoration Pact
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To articulate public and private institutions, governments, NGO, researches, corporations, landowners, etc... ...To integrate knowledges, efforts and resources... ...To promote large-scale restoration and conservation of biodiversity... ...At the most critical areas in the Atlantic Forest.
Our strategy
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Government: 47
Private Sector: 66
Third Sector: 127
Labs and universities: 17
257 members
Members
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Thinking at large-scale, or the challenge to upscaling more and more. An approach based on landscape ecology and environmental services. The concept of forest restoration supply chain. Matching and applying science and economic incentives to legal compliance.
The Pact´s impact
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Members
Board of Coordination
Steering Committée
Executive Secretary
Task Forces Technical and scientific issues
Knowledge and information
Communications
Forest restoration economy
Governance
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IIS- PACTO – Agenda Economics Working Group
•Phase 0: Define the models and structure the questionnaire
•Phase 1 : Costs and revenues
•Phase 2: Risks, market and business case
1. Financial analysis of the reforestation models
•Phase 1: Prioritization for carbon, water, biodiversity, costs and opportunities, pasture productivity, legal deficit
•Phase 2: Incorporation of the spatial aspects of restoation models (inc. relation com infrastructure and markets)
•Phase 3: Optimized multiobjective spatial prioritizaion 2. Spatial prioritization analysis
•Phase 1: Jobs and income
•Phase 2: Poverty and inequality reduction
3. Socioeconomic impacts of reforestation models
•Development of financial models (in function of the models)
•Survey of the potencial financing sources
4. Development of financial mechanisms
•Ompacts on biodiversity
•Impacts on climate mitigation
•Impacts on water resources
•Impacts on other ecosystem services
5. Estimate of environmental benefits of large-scale reforestation (e.g. Pacto)
•Estimate of the potencial job screation (direct and indirect within the entire chain), income, poverty and inequality reduction following large-scale reforestation
6. Estimate of socio-economic benefits of large-scale reforestation (e.g. Pacto)
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• Phase 0: Define the models and structure the questionnaire
• Phase 1 : Costs and revenues
• Phase 2: Risks, market and business case
1. Financial analysis of the reforestation
models
• Phase 1: Prioritization for carbon, water, biodiversity, costs and opportunities, pasture productivity, legal deficit
• Phase 2: Incorporation of the spatial aspects of restoation models (inc. relation com infrastructure and markets)
• Phase 3: Optimized multiobjective spatial prioritizaion
2. Spatial prioritization
analysis
• Phase 1: Jobs and income
• Phase 2: Poverty and inequality reduction
3. Socioeconomic impacts of
reforestation models
IIS - PACTO – Agenda Economics Working Group
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• Development of financial models (in function of the models)
• Survey of the potencial financing sources
4. Development of financial mechanisms
• Ompacts on biodiversity
• Impacts on climate mitigation
• Impacts on water resources
• Impacts on other ecosystem services
5. Estimate of environmental benefits
of large-scale reforestation (e.g. Pacto)
• Estimate of the potencial job screation (direct and indirect within the entire chain), income, poverty and inequality reduction following large-scale reforestation
6. Estimate of socio-economic benefits of
large-scale reforestation (e.g. Pacto)
IIS - PACTO – Agenda Economics Working Group
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Structure
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape
Introduction
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Paradigm shift - Current Prevalent Paradigm
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Paradigm shift - Current Prevalent Paradigm
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Paradigm shift
Current Prevalent Paradigm
Restoration involves very high costs per hectare…
… with no financial return for the land owner…
… only has environmental benefits…
… and these environmental benefits are poorly perceived…
… and not internalised
New Paradigm
R&D and extension help to reduce costs…
… and, in some cases, increase revenues…
Restoration is an industry that create jobs, contributes to the general economy…
… and the resulting Natural Capital provides goods and services to humanity, including spiritual services and existence value of biodiversity
… and should be at least partially internalised
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One word of caution
• Natural Capital, Ecosystems Services and similar approaches have a tremendous potential to help society realize the value Nature provides for humans;
• Included in these are spiritual and existence values (recognizing that biodiversity have value for us even if there are not direct or indirect benefits);
• These might be enough to justify “Ecocentric” restoration for wild habitat;
• But these approaches do not include a potential intrinsic value of nature, an ethical perception that other living beings have value in themselves;
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Challenges
• Of production, of the market, legal aspects Risks
• Farmer and the society do not recognize the value of forests Incomplete information
• Even if the the will exists, there is a lack of extension for forest restoration Extension
• Very long time horizon (esp. for small-holder farmer) Time
• Current cost per hectare is very hingh, perception of opportunity costs, costs of transition Costs
• Uncertainty com future prices Returns
• Externatilites are still not internalized, high costs of the transition in incipient markets Incomplete market
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Some possible solutions
• R&D, consolidation of the market, simple and clear legal frame Risks
• Roboust research and research-based dissemination Incomplete information
• Better extension from public sector, incentives for private extension Extension
• Non-timber products, consorcium with the species of fast growth, PES Time
• R&D, dissemination, experience, scale Costs
• Consolidation of the markets, warranty for the demand/prices, consorcium with the leading species Returns
• Internalization of the benefits, PES Incomplete market
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Tropical forest restoration: show us the money P.H.S. Brancalion, R.A.G. Viani, B.B.N. Strassburg & R.R. Rodrigues
Developing commercially viable systems
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Level the playing field
Perceived Value
Not Perceived Value
Low-productive Cattle Ranching
Restored Ecosystem
Subsidies
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To further level the playing field
Perceived Value
Not Perceived Value
Low-productive Cattle Ranching
Restored Ecosystem
Subsidies
Partial PES
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The current playing field
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Structure
The Pact for the Restoration of the Atlantic Rainforest
Developing a Restoration Economy
Large Scale restoration and the Landscape
Introduction
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The Economies of Scale and Spatial Prioritization of Restoration
Ecological value
connectivity
potential habitat
water
carbon
border effects
conflict with other land-uses
Economic and Social values
Economies of scale due to reduced costs
higher resiliency
lower border effects
reduced conflicts and opportunity costs
increased value of services
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Addressing fragmentation
New study showing effects of isolation on mammal communities
Although the study is based on islands the authors hihglight “ a dire need to maintain large intact forest blocks to sustain tropical biodiversity"
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Competition for land
• Lambin and Meyfroidt, 2011 Global land use change, economic globalization, and the looming land scarcity, PNAS; Smith et al., 2010 Competition for Land, PTRS
• In Brazil – competition with agriculture (in all biomes) • Atlantic Rainforest – extensive pasturelands, no ongoing deforestation (around
90% already gone) • Espirito Santo State – plans to both increase agricultural productivity and
forest cover • Difficult without produtivity increase (except in abandoned areas)
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Competition for land, leakage
Pasturelands
Forests Elsewhere
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The “Land Neutral Ecological Restoration” Mechanism B
efo
re
Aft
er
Multiple Uses (Crop-Livestock)
In-Farm Mitigation Consortium Compensation Single Use +
Intensification
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Reducing competition for land and sparing land for reforestation
Latawiec AE, Strassburg BBN, Brancallion P, Rodrigues R., in prep
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• Current productivity : 118 million Animal Units;
• Potential sustainable carrying capacity: 367 mi Animal Units;
Current productivity only 32-34% of potential
Current Productivity Potential Productivity
Restored Areas
All 2040 production targets + 36 million hectares restored
Avoiding the “Conflict for land”
Strassburg, Latawiec et al. (submitted)
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• The Atlantic Rainforest has lost 88% of its area, and is under risk from climate change;
• A movement with significant representation from Brazilian society is pushing for large scale restoration;
• A paradigm shift is need in terms of financing landscape restoration;
• Restoration systems delivering goods and services can be financially attractive;
• Special attention to landscape benefits and risks are needed when designing large scale restoration;
Take home messages
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Thank you [email protected]