Browsing by Subject "Economic valuation"

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Open Access
Economic Valuation of Environmental Impacts of a 2D Seismic Survey in the Marañon River Basin, Peru
(2014-04-25) Manrique Zeder, Liseth
This study seeks to estimate in monetary terms the impacts on the ecosystem services of a 2D seismic Project in the rainforest region of Peru. Economic valuation of the environmental impacts of land use projects is an important part of Environmental Impact Assessments (EIA) in Peru. EIAs are used to establish a social and environmental base line, identify impacts, and establish mitigation measures and compensations. Legislation is very broad in regard to the goals and ways to conduct economic valuations. Assessments are not comparable and/or use overly general secondary data. In this context, this study proposes a way to both standardize and improve the economic valuation methods for EIAs in Peru by using local data on the impacts on the ecosystem services and on the economy of the people that depend on them and accounting for the impacts after the project has ended. The impact of the project on the carbon capture and storage are calculated through valuation of carbon stocks, deforestation carbon flux loss, and reforestation carbon flux. The impacts on the economic activities that depend on ecosystem services are also estimated for agriculture, hunting and fishing. The results of this analysis vary largely from the ones obtained for the same project using overly generalized data from literature reviews and research conducted in other parts of the world. This shows the bias that overly discretionary guidelines generates; it is also a call to the environmental authorities to establish a common ground for economic valuations in EIA and the benefits that this could represent for the authorities, local communities and the companies that conduct projects in Peru. The first part of this document provides an introduction to the topic, followed by a description of the methods applied and an identification of the project’s impacts. These impacts are then assessed by prevention and mitigation measures in the fourth part. The impacts are classified in potential and residual impacts. The residual impacts after the mitigation plans are valued using data from local sources, forest inventories, household surveys and relevant literature.
Open Access
Economic Valuation of Mangrove-Fishery Linkages in Guyana and Suriname
(2019-04-24) Bollini, Celeste; Millar, Emily
Mangroves are among the most productive ecosystems in the word. By providing valuable ecosystem services, mangroves enhance human well-being and contribute to biodiversity conservation in the tropical and subtropical regions where they are found. Mangroves provide nursery, feeding, breeding grounds, and shelter areas for many marine species, which in turn enhances the productivity of traditional and commercial fisheries. The objective of the present study is to evaluate how mangrove ecosystems affect fisheries in Guyana and Suriname, as part of a collaborative project between the Nicholas Institute for Environmental Policy Solutions and Conservation International. The evaluation involved conducting a meta-analysis of information drawn from 21 mangrove-fishery linkage studies from around the world to estimate a general model relating fish catch to mangrove area. A benefit transfer method was then used to apply the results from the meta-analysis to recent and projected future changes in mangrove areas in Guyana and Suriname, and thereby predict the impacts on fish catch in the two countries. The first section of this report provides an overview of mangrove ecosystems, definitions of the four types of ecosystem services identified by the Millennium Ecosystem Assessment, and an outline of the ecosystem services provided exclusively by mangroves. This section also highlights some of the main global drivers of mangrove loss. Lastly, it provides the main objectives of this project, an overview of Guyana and Suriname, and estimates of the areas and trends in mangroves in both countries. Mangrove area change was calculated using the average of estimates from two sources for each country. The estimated changes in mangrove area during 2000-2017 were -1.96% per year in Guyana and -0.76% per year in Suriname. The second section of this report describes the methods used to determine how these trends have affected fisheries in Guyana and Suriname. After providing an overview of the meta-analysis and benefit transfer methods, this section explains the variables selected for the meta-analysis. Variables were selected to capture essential characteristics of the study sites and the studies themselves. Finally, the equation estimated by the meta-analysis is defined. This equation relates the impacts of mangrove area reported by the studies to the selected variables. Observations were included in the dataset for estimating this equation only if a study included sufficient information for calculating the reported impact as an elasticity, which can be explained as follows: denoting the elasticity by Ɛ, a 1% increase in mangrove area increases fish catch by Ɛ%. The third section of this report applies the results from the meta-analysis to calculate the benefit transfer estimates for each country. There are two final models: a shellfish model and a finfish model. The shellfish model was used to generate the estimate for Guyana, while the finfish model was used to generate the estimate for Suriname. For Guyana, the predicted elasticity (Ɛ) is 0.924, which implies a 1.81% loss in shellfish catch per year resulting from the recent loss of mangroves in that country. For Suriname, the predicted elasticity (Ɛ) is 1.77, which implies a 1.34% loss in finfish catch per year resulting from that country’s recent loss of mangroves. These estimated losses in fish catch were calculated by multiplying each country’s elasticity by the observed changes in mangrove area noted previously. The fourth section of this study provides a discussion of the analysis and estimates the benefits of mangrove restoration in each country. If the estimated loss in mangrove area had not occurred in Guyana, the Guyanese fishery would have gained $586,440 in revenue net of costs. Similarly, if the estimated loss in mangrove area had not occurred in Suriname, the fishery in that country would have gained $180,900 in revenue net of costs. This section also provides a comparison to previous mangrove-fishery linkage studies. This is followed by a discussion of limitations of the present study, including the wide variation in mangrove area and mangrove area change estimates found in different sources. Lastly, recommendations for future data collection are provided. The final section of this study provides an insight into mangrove-fishery linkages within the countries of Guyana and Suriname for specific fisheries as well as the associated monetary gains resulting from conserving mangrove area. These estimates are insufficient for determining the total value of conserving mangrove area, but a more complete estimate of total value could be determined by applying valuation methods, similar to those used in this study, to additional ecosystem services.
Open Access
Economics Valuation of Flood Mitigation Services Provided by Tropical Forests in Malaysia
(2010-04-30T17:58:37Z) Tan-Soo, Jie-Sheng
Forests are provider of many ecosystem services which benefits a wide group of people. But the lack of markets to capture payments for these services meant that forest owners chose to convert their assets to provide marketable goods for a smaller group. Payment for ecosystem services (PES) schemes was developed specifically to ensure that forest owners can receive payments in return for providing ecosystem services. One such service provided by forests is flood mitigation and valuing this service has always been challenging due to the lack of suitable data. This study has the unique opportunity to fill in this knowledge gap by using a 20-year flood data from Malaysia. The purpose of this study is thus to measure the economic benefits derived from flood mitigation services by increasing forest cover by 10%. The conceptual approach is the Freeman three-stage framework and the main techniques employed are regression analysis and benefits transfer. In the first stage, it was found that the 10% increase in forest cover leads to a reduction in number of days flooded by 1.552 days for every flood in West Coast Malaysia. In the second stage, we found that one lesser day of flood decreases the number of evacuees by about 10.4% and number of deaths by about 3.62%. These two results are combined to show that a 10% increase in forest cover reduces the number of evacuees and deaths by 16.1% and 5.61% respectively. Valuation of these benefits is undertaken in the third stage using benefits transfer where it was calculated that the flood mitigation benefits provided by 10% increase forest cover is about 3.5 million ringgit over 20 years on West Coast Malaysia. This figure not only provide a good starting point for implementing a PES scheme but is also useful for conducting a cost-benefit analysis of different flood mitigation policies. However, it should be highlighted that this value is an understatement of the actual benefits as there are many other prominent averted damages not included.
Open Access
Impact of Ecosystem Services Loss to Macroeconomic Productivity
(2022-04-22) Hermanson, Max; Chen, Mingyi; Vanasse, Sam; Wang, Yifan
Ecosystem service losses pose an enormous threat not only to the environment, but also to businesses and society. The Duke student team helped its client, Ortec Finance, assess frameworks around ecosystem service losses and risks to different business sectors by conducting a literature review, describing analysis methodologies, and providing recommendations. The literature review showed that quantifying the economic impacts of ecosystem services is effectively done through either partial-equilibrium or computable general-equilibrium models (CGE’s). The foremost publication regarding CGE models was found to be a report by the World Bank, which provides insights into how countries and economic sectors will differ between 2021 and 2030 due to BES losses. Additional literature showed consensus on three sectors: agriculture, raw material mining, and manufacturing are at the highest risk from ecosystem service losses. A flowchart was created to easily summarize how different ecosystem services link to various economic sectors. Geopolitically, developed countries in North America and Europe have low direct GDP dependency on BES. Other developing countries like China, India, and Brazil all have moderate to high GDP dependency. In comparing quantification methodologies used to analyze the economic impacts of ecosystem services, we recommended that Ortec Finance focuses on the Swiss Re BES Index as well as the ENCORE tool. The results from these two main approaches conducted by this report should feed into the expansion of Ortec Finance’s proprietary tool, Climate Maps, on ecosystem services.
Open Access
Quantification of the Health Impacts Associated with Fine Particulate Matter due to Wildfires
(2008-04-24T16:18:09Z) Douglass, Rachel L.
Wildfires can be devastating to property and the ecological landscape; they also have a substantial impact on human health and welfare. Wildfires emit a variety of air pollutants such as fine particulate matter (PM2.5), coarse particulate matter (PM10), volatile organic compounds, as well as nitrogen and sulfur oxides. Fine particles (PM2.5) have been linked to many cardiovascular and respiratory problems such as premature death, heart attacks, asthma exacerbation, and acute bronchitis. This project focuses on quantifying the incidence and monetary value of adverse human health impacts resulting from wildfire emissions of PM2.5 in the Pacific Northwest during the summer of 2007. Using a combination of tools, including geospatial analysis and a benefits assessment tool developed by U.S. EPA (BenMAP), this project investigates the changes in incidence of certain health outcomes resulting from the change in air quality attributable to wildfire. The changes in incidence can then be given a dollar value using valuation functions to highlight the magnitude of the health effects caused by PM2.5 wildfire emissions. In light of current climate change predictions, PM2.5 wildfire emissions may be expected to increase in the future.