Seven million dollars, if you don't want to read any further. A mangrove swamp doesn't seem to have any value at all: in coastal areas, mangroves are low-growing trees with long, tangled roots that thrive in water instead of in soil. They blanket shallow brackish waters in the tropics, and they're the first thing to be cleared for shrimp farming. Shrimp farming provides profit, while mangroves aren't good for much beyond wood gathering, right?
A new United Nations report, The Economics of Ecosystems and Biodiversity, quantifies the benefits of ecosystems. They're staggering.
TEEB involved rounding up over 1,100 studies done on ecosystems around the world, and analyzing the distinct ecosystem services they each offer, such as freshwater supply and erosion control. Maintaining nature's capacity to fulfill their functions is less expensive than investing in technological solutions.
A shrimp farm in Thailand brings net private economic returns of $1,220/hectare/year; but the swamp brings benefits of $10,821/hectare/year for protecting the coast against storms, $987/hectare/year for acting as a nursery for offshore fisheries, and $584/hectare/year for wood gathering. The study didn't attempt to quantify what might be the largest benefit: the carbon sequestration value of the mangrove trees. In other words, the purportedly useless mangrove swamp is worth ten times as much as the productive shrimp farm. A different study of mangroves in Vietnam found that planting the trees cost $1.1M but saved annual expenditures on dike maintenance of $7.3M.
Need another concrete example? In Costa Rica, preserving a forest increases the yield of coffee farms by 20% because the forest shelters pollinating insects. In New Zealand, a grassland conservation park acts as a natural water catchment, supplying the Otago region with free water that would cost $136M/year (in New Zealand currency) to bring in from elsewhere.
The study quantifies REDD (reducing emissions through deforestation and degradation), an important acronym for climate talks next month in Copenhagen. Expanding REDD (paying people to not cut down forests) to REDD-Plus (paying them to restore trees) increases carbon mitigation potential. Currently, REDD is estimated to cost the world $17B to 33B/year, while the long term benefits are $3.7T in present value; deforestation is generally believed to account for 15-20% of all the carbon emissions of the world, or more carbon than all cars, trucks, planes, and ships combined.
The TEEB report provides reasons to invest in "natural capital." Among them are climate change mitigation and adaptation (REDD is a very inexpensive way to cut down carbon emissions, compared with fantastically expensive methods such as carbon capture and storage, or so-called clean coal); ecological infrastructure such as water purification; investment in protected areas; and restoration of degraded ecosystems.
What's the most surprising aspect of the study? The researchers report, via Newsweek, the high ratios of return when conservation projects were undertaken. With agriculture alone, addressing problems with soil consistency or water contamination would pay substantial dividends, they found -- an average global rate of return of $60 for every $1 invested.
I was struck by a different issue -- the paucity of United States examples. In New York, payments to maintain water purification services in the Catskills watershed were $1B - $1.5B, significantly less than the cost of constructing ($6-8B) and maintaining ($300M-500M/year) a filtration plant. That's smart thinking. However, compare the typical United States Forestry Service timberboard-feet thinking with that of India, as described in the TEEB report. The Indian Supreme Court has drawn up a scheme of payments for converting forests to other uses, based on values such as timber, fuel wood, ecotourism, and values for conserving habitat of charismatic species such as the Bengal tiger and Asiatic lion. If you cut down a tree, you pay the Afforestation Fund, which releases 143M Euros every year for afforestation, wildlife conservation, and rural jobs.
What would happen if the United States were to calculate the nitrogen cost for every bag of chemical fertilizer sold, and tax accordingly? Nitrogen from agriculture causes dead zones in the Gulf of Mexico and Cheseapeake Bay.
What would happen if the United States Forest Service were to assess the true carbon sequestration value of boreal forests in considering logging requests? Boreal forests account for 60 percent of all forest carbon sinks.
What would happen if the United States were to require that all operators of confined animal feedlot operations pay for the methane emissions of their animals? Methane from cattle is a major contributor to climate change. Even a minor matter such as changing cows' diet from corn and soy to alfalfa and flaxseed cuts methane emissions 18%.
Some governments are on board with the TEEB concept already: Germany, which initiated the project in 2007, Norway, and Britain. However, common sense, long term thinking, and making the polluter pay are novel concepts in the United States. We need to better calculate the economic benefits of ecosystems along with the costs of ecosytem destruction.