Ecosystem services: putting a price on nature
There was an article in 2015 published by The Guardian titled “Nature gives us everything free — let’s put it at the heart of everyday economic life.” where the author stated that the natural assets that matter is the renewables assets. Nature keeps on providing us for free if we don’t deplete them beyond the threshold of sustainable reproduction.
But let’s take a step backwards. Is nature (capital) free?
OK, one more step. What “free” mean? I got the dictionary, and there were too many examples and ways of explaining, so I stopped.
In my language (Macedonian), we have two different words for free: 1) слободно (as in free speеch, lat. libre) and 2) бесплатно (as in free beer, lat. gratis). This “Free beer” vs “freedom of speech” distinction was discussed a long time in the open-source software community, where it says that: “in the free software movement feel strongly about the freedom to use the software, make modifications, etc., whether or not this freely usable software is to be exchanged for money.”
My opinion that we can define nature free as free speech (libre), rather than free as free beer (gratis). Why? Because you have the liberty to use the nature and the services provided by her, but this will not come without costs (that means it is not free (gratis). With this, we can accept that nature has value.
Now we can introduce the ecosystem services. Ecosystem services are defined in the Millennium Ecosystem Assessment (MA) as
“the benefits people obtain from ecosystems”.
The term was firstly introduced in 1970 “environmental services” in a report of the Study of Critical Environmental Problems. In the MA the ecosystem services were grouped in four groups: 1) provisioning services: wild foods, crops, freshwater and non-timber forestry products, then 2) regulating services: filtration of pollutants by wetlands, climate regulation — carbon storage and water cycling, pollination and protection from disasters, 3) cultural services: recreation, spiritual and aesthetic values, education and 4) supporting services: soil formation, photosynthesis and nutrient cycling.
Nature gives a lot of benefits to humans that are “free” for usage. When we use the land we have, agroecosystems, when we use the forest — we use the forest ecosystems, when we use of pastures — grassland ecosystems and when we use of fish — aquatic ecosystems. You can put a price on a farm product, timber or fish, so beside value, you can put a price on those ecosystem services.
But there are some ecosystem services like the natural pollination of crops, the clean air, and the extreme weather mitigation that are essential for the production of food. We can add clean drinking water, the decomposition of wastes, and resilience and productivity of food ecosystems.
All those ecosystem services have value, and the value can be determined based on different methodologies (Hedonic model, Contingent Valuation, etc.). When development is planned in the region that will destroy nature, investors should calculate as economic benefits lost.
Ecosystem services is a methodology to value nature in financial and economic terms. The idea of Ecosystem services is not to prevent development but to weight the development and provide the decision-makers on a transparent way to make their decisions, and calculate the potential worth of the natural value lost. With the presentation of results, decision-makers will be held responsible for their decision on a systematic and weighted way.
In the end, we are all going to pay the price for the destruction of nature, if we do not value it.
