Costing Mother Nature's Service: The Central Role of Healthy Ecosystems in Providing Critical Services Has Been, until Very Recently, Overlooked and Often Taken for Granted
Salzman, James, Ecos
When we bite into a juicy apple, we might think of soil and water but probably not of the natural pollinators that fertilise the flower so the fruit can set. When we think of clean water, we may not think beyond the tap, but the real source of the clean water lies many miles upstream in the wooded watershed that filters and cleans the water as it flows downhill. When we think of a fun day at the beach, we appreciate the warm sun but perhaps not the carbon sequestration by plants that contributes to climate stability.
Created by the interactions of living organisms with their environment, a suite of 'ecosystem services' underpin society by purifying air and water, detoxifying and decomposing waste, renewing soil fertility, regulating climate, mitigating droughts and floods, controlling pests and pollinating vegetation.
While awareness of ecosystem services dates back to Plato, ecologists and economists have only recently begun systematically examining the extent and value of their contributions to social welfare. Not surprisingly, recent research has demonstrated the extremely high costs to replace many of these services if they were to fail. They are in the order of billions of dollars in the US for pollination alone.
Given their significance, once might expect that ecosystem services would be prized by markets and explicitly protected by the law. With few exceptions, however, neither has been the case.
The primary reason ecosystem services are taken for granted is that they are free. We explicitly value and place dollar figures on certain 'ecosystem goods' such as timber and seafood, yet the services underpinning the production of these goods--almost without exception--have no market value because there is no market to capture and express their value directly. When we buy a wetland, we are paying for location and scenic beauty, not its role as a nursery for sea life. Such circumstances make ecosystem services easy to forget--until they fail.
Consider the service of water purification and the Catskills watershed in New York state, USA. Under a new US law in the early 1990s, water suppliers were required to filter their water unless they could show they had taken alternative steps to ensure safe drinking water. New York City faced a choice: it could invest in building a filtration plant for US$6 billion to $8 billion (and another $300,000 annually to operate) or it could invest in natural capital, restoring water purification services in the upstream Catskills watershed at a cost of roughly $1.5 billion (to pay for changes in land management practices).
The City chose to invest in the ecosystem service, the lowest cost option. Upper catchment landowners, the stewards of the watershed, are compensated for the purification services they provide to the city. More broadly, those who value other services supplied by the Catskills ecosystem (e.g. carbon storage, aesthetic and recreational benefits, cultural preservation) will see these better protected under the umbrella of water purification. …