Prof. Dr. Rudolf de Groot
Environmental Systems Analysis Group, Wageningen University, Netherlands
Chair of the Ecosystem Services Partnership
Decisions regarding landscape restoration or other interventions in the landscape are still based on incomplete information about the true costs and benefits which leads to continuing loss of natural ecosystems and landscape degradation. One of the barriers to attract funding for large scale landscape restoration is that money spent on nature conservation, landscape restoration and sustainable land management is still seen as a cost and not as an investment with a high return in benefits. More balanced and better informed decisions requires more inclusive, so-called Social- or Integrated Cost-Benefit Analyses (iCBA). Case studies applying iCBA consistently show that the true welfare effects of sustainable land use are higher than those of the non-sustainable alternative, provided all positive and negative externalities are accounted for.
To determine the true benefits (or costs) of investing in landscape restoration, guidelines are needed to analyze, quantify and, where possible, monetize the effects of all externalities (positive and negative) of changes in land use and management. In this talk I will illustrate one of these guidelines which has been developed for an organization called Commonland (www.commonland.com) that invests in large scale landscape restoration. As a case study I will use the results of an integrated assessments of the economic costs and benefits of large-scale landscape restoration in a dryland region in SE Spain that is facing serious land degradation. Based on fieldwork between 2017 and 2019, involving many stakeholders, we compared the net-benefits (or- costs) of several farms that are implementing aspects of a multi-functional sustainable land use system (called Almendrehesa, somewhat similar to the traditional land use in this region) with those of almond monoculture, both conventional and sustainable. The net benefits (or costs) of investing in landscape restoration are then derived from the differences in Net Present Value (NPV) between the three land use alternatives
Our study clearly showed that conventional, financial CBA almost always favors short-term usually non-sustainable land use. Using i-CBA gives much more realistic insight in the true welfare effects of the direct and indirect returns of landscape restoration. An added benefit of this integrated approach is that it enables identification of mechanisms to capture the ‘full value’ of sustainable, multi-functional land use through so-called blended financing mechanisms. Eventually sustainable (land) management will then become the norm, not the exception because it is both financially more profitable for the private land owner and economically and socially more beneficial to the community than non-sustainable land use.