Marcela Quintero CIAT’s Ecosystem Services Strategic Initiative August 3, 2015 Hanoi, Vietnam

Introduction Growing interest of research and political sectors globally on understanding the socioeconomic and environmental implications of the increasing loss of ecosystem services in degrading/degraded landscapes (Nkonya et al.,2011). The Millenium Ecosystem Assessment (2005) The Economics of Ecosystems and Biodiversity initiative (TEEB, 2014) Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES)

The Importance of Ecosystem Services in Agriculture Crop yields rely on the provision of ecosystem services, which can be negatively or positively affected by agriculture, depending on the practices applied for managing crop systems and agricultural landscapes. Farmers can be beneficiaries of ecosystem services or coadjutants in their provision. Proper management practices at the crop field and landscape level may turn these disservices into ES, with agriculture becoming an ES provider benefiting other actors or sectors. Bommarco et al. (2013) presented the important relation between supporting and regulating ES and yield gaps

Selected ecosystem services (ES) and ecosystem disservices (ED) from and to agriculture (adapted from Stallman, 2011)

What ecosystem services is CIAT looking at, where, and for whom? Ecosystem Services in the CIAT research agenda

Ecosystem Services Research Agenda Development of tools and methodologies to quantify and map ES associated with different land-uses in agricultural landscapes. Economic valuation of ES that benefit agriculture and ES impacted by agriculture to determine the level of investment and incentives required for protecting ecosystem services provided in agricultural landscapes. Identification and assessment of alternative land-use and management practices based on their impacts on ES. A special contribution of CIAT on providing scientific evidence on the role of agriculture in both providing and using ES efficiently. 1.Demonstrate delivery 2.Put it on the map 3.Value the benefits, measure the threats 4.Assess alternative land- use practices 5.Support institutional innovations To maintain:

Ecosystem Services Research Agenda Direct and indirect contributions of ES to food security, nutrition, and well-being in impoverished rural areas. The impact of plausible socioeconomic and climate change scenarios on ES provision. Regional and global analyses on the state of knowledge, policy, and action to improve the provision of ES in agricultural landscapes. 1.Demonstrate delivery 2.Put it on the map 3.Value the benefits, measure the threats 4.Assess alternative land- use practices 5.Support institutional innovations To strength:

What ES should be targeted?

Some examples Assessment of Conservation Agriculture in the Colombian Andes Payment for Ecosystem Services in Peru Sustainable Amazonian Landscapes Environmental fooprinting ASSETS: Linkages between Food Security, Human well-being and Ecosystem Services

Assessment of Conservation Agriculture in the Colombian Andes Conservation agriculture Rotation with cover crop Minimun soil disturbance Permanent land cover

Understanding on-site impacts of conservation tillage 12 Conservation agriculture Traditional agriculture % Volumetric Water More water stored, restoring the buffer role of paramo Conservation agriculture Traditional agriculture Accumulated Organic Matter (g/g) Better soil porosity, filtration, increased carbon storage Impact of conservation tillage on soil and water conservation Resilient system Quintero et al. 2010

“Reduced tillage and cover crops in potato-based systems improved in a 7- year period the soil organic matter and carbon content in disturbed soils of the páramos of Colombia. The soil carbon concentration in the whole pro-file was 29% higher under conservation tillage than un-der conventional tillage sites and the carbon content was higher by 33%.” (Quintero and Comerford, 2013)

Impact of conservation tillage (CT) on nutrient and soil loss in Colombia Effects of CT can not be generalized The results showed statistical differences across crops in some, but not all, crop cycles Longer-term observations are required to evaluate the impact of the whole rotation Depend upon the type of soil and precipitation conditions as well as the fertilizer application timing

Nutrient and sediment losses are generally lower in Inceptisols than in Andosols

CT seems to have a positive effect on reducing nutrient losses in Inceptisols Due mainly to significant higher nutrient concentrations in runoff water and sediments from potato-IT than potato-CT

Nutrient losses vs. permissible levels

How to achieve reductions in nutrient losses? Efforts to reduce soil losses had to be combined with adjustment of nutrient application rates The reduction of nutrient loss is not achieved via reducing soil loss ab a a b a

Residues from precedent cover crop in potato-CT does not limit soil loss relative to potato-IT, especially during those specific events when highest loss typically occurs

Impactos en la cuenca

Institutions for Rewards for Ecosystem Services mechanisms in Peru

Upper basin( Ecosystem service provision (Water yield (mm)) Middle basin (350 – Lower basin (0-350) 0-50 Peruvian case study, Canete River watershed – Current situation Upper basin( River flow use (m3/s) 0 (mostly from springs) Middle basin (350 – , 64 Lower basin (0-350) Upper basin( Water and land uses Extensive degrading grazing, subsistence agriculture Middle basin (350 – 4000 Hydropower company Shrimp growers Lower basin (0-350) Urban dwellers Water inefficient commercial agriculture Tourists (rafting)

Desired situation: REWARDING for ES Upper basin( Middle basin (350 – 4000 Lower basin (0-350) Transfer part of their benefits Investment in conservation alternatives Watershed’s socioeconomic asymmetries might be balanced by this benefit-sharing mechanism

Research Highlights: Putting the pieces together for designing a PES Where payments should be targeted to? Identification of service providing areas using hydrological modeling What should be the payments amount to be made by ES beneficiaries? Estimation of economic value of watershed services for different ES users: Valuation of water-related ecosystem services* Type of downstream water user Value of the WES Current price of water Irrigated Agriculture (US$ m 3 ) Tourism (US$/ind)15.75n.a. Urban users Domestic (US$ mon -1 ) Commercial (US$ mon -1 ) These values are reference values to be used for anticipated negotiation processes. How payments should be used? Ecosystem conservation measures and social development projects.

Creation of a trust fund to provide rewards and incentives for conserving upper watershed ecosystems Who should contribute to the trust fund?

Requirements for the RES schemes design and implementation Targeting actions: What and where? Economic values of ES for the demand as a reference value to negotiate contributions to a ES Fund Willingness to pay Enabling the legal environment Enabling institutional environment

Progress towards implementation Quintero, M., Pareja, P., Rivera, G. (Forthcoming).

What is impeding the implementation of RES schemes in watersheds of Peru?

Falta de claridad sobre cuál es la estructura institucional viable y efectiva que administrará la retribución Municipalidad EPS Facultad de recaudación a través de tributos Facultad de disposición de recursos determinados (FONCOMUN, CANON, etc.) Facultad de recaudación a través de la tarifa de agua Facultad de recaudación a través de un cobro voluntario anexado al recibo de agua Facultad de transferir los recursos a un Fondo Municipal Facultad de transferir los recursos a un Fondo privado o mixto Facultad de transferir los recursos a un Fondo Municipal Facultad de crear una cuenta independiente. Facultad de invertir los recursos a través de SNIP Facultad de hacer retribuciones directas a los caodyuvantes o por subvenciones Institución Independiente (Empresa privada/ONG/Juntas de Riego) Facultad de recaudar recursos públicos Falta de lineamientos para el diseño de mecanismos de RSEH Gobernabilidad Facultad de invertir los recursos a través de SNIP Facultad de hacer retribuciones directas a los caodyuvantes o por subvenciones Facultad para celebrar contratos y/o acuerdos en tierras con y sin título. Capacidad operativa débil e insolvencia económica Alta morosidad en el pago de tributos Consejos o Comités de Recursos Hídricos (ANA) Aun débil capacidad de gestión y gobernanza Se requiere reconocimiento como cuenca prioritaria por el ANA Falta claridad sobre el rol y/o las facultades que podrían tener en los mecanismos de RSEH Grupo impulsor /Comité gestor /Grupo técnico de gestión Nivel de articulación con la institucionalidad creada por el ANA Empresa de Luz: Facultad para recuadrar a través de la tarifa de luz o cobro voluntario anexo Necesidad o no de personería jurídica DESIGN DIAGNOSTIC Falta de recursos para la realización de estudios de diagnóstico Escasa disponibilidad de información técnico- científica

NEGOTIATION OF BENEFIT-SHARING AGREEMENTS Escasos incentivos para estimular involucramiento de la empresa privada Potencial de recaudación no explotado (1 beneficiario) Voluntariedad de la retribución Falta de recursos para fortalecer las estrategias de comunicación IMPLEMENTATION Recursos recaudados insuficientes Falta de planes financieros Aportación de beneficiarios no recurrentes y con expectativas de cambio a corto plazo Inapropiado conocimiento sobre la relación ecosistema - agua Falta de propuestas técnicas efectivas para la conservación y/o recuperación de SEH Falta de organizaciones a quien se les delegue la implementación técnica de las alternativas para proveer SEH

Legal bottlenecks Inability to transfer voluntary contribution from urban water users to an indenpendent Fund for PES How to channel public resources of local governments into PES funds? How to ensure sustainability of the fund –voluntary vs mandatory?

Legal and institutional bottlenecks Financial independence Lack of trust on current organizations Lack of guidelines on how to establish new institutions for operating RES (rules and organizations) Who should manage the ES trust fund?

RES implementation requires multisectoral coordination for operating There is a lack of an institutional structure for an integrated watershed management National policy on water resources proposed the creation of watershed councils, however the process of creation is incipient and lack a specific funding for its funtioning How to articulate RES into future wateshed councils?  intersectorial coordination and need for official guidelines SERNANP: National Service of Protected Areas Local water authority / National water authority

Analysis of bottlenecks in the implementation of Rewards for Ecosystem Services schemes in watersheds of Peru

Overcoming bottlenecks for RES implementation New Law on RES Offical recognition of RES, eventhough are voluntary Definition of RES: Rewards and incentives Avoid perverse incentives Enable transfer of urban water users contributions into RES funds Highlights the importance of articulating PES with existing land and water use/management plans Offical recognition of RES, eventhough are voluntary Definition of RES: Rewards and incentives Avoid perverse incentives Enable transfer of urban water users contributions into RES funds Highlights the importance of articulating PES with existing land and water use/management plans Remaining gaps How to become voluntary contributions in a legally binding to ensure continuity Management design that guarantees independency and transparency How to become voluntary contributions in a legally binding to ensure continuity Management design that guarantees independency and transparency Canete institutional arrangement for implementation Creation of ad-hod watershed committee for PES governance  transition towards watershed councils National organization that currently manages conservation project will manage the PES Fund High replicability potential Creation of ad-hod watershed committee for PES governance  transition towards watershed councils National organization that currently manages conservation project will manage the PES Fund High replicability potential

Project components improving the capacity to monitor land cover changes in order to assist the monitoring of the effectiveness of land-use based mitigation and national adaptation plans. identifying the likely pathways the countries may take towards sustainability in terms of ambitious climate protection and around which the mitigation-adaptation land-use options might be framed. enhancing country capacity to assess cost-efficiency of the adoption of these options in terms of improving adaptive capacity while providing other co-benefits (i.e. carbon sinks enhancement, protection of natural forests and water ecosystem services of importance for local livelihoods). providing national authorities with validated land-use options, designed in cooperation with rural communities, that contribute to the design of low-carbon development, and climate change mitigation and adaptation strategies Land use- based alternatives Cost-efficiency analysis Monitoring of land cover changes Transition pathways toward sustainable development Multi-scale approach

Marcela Quintero Thanks for your attention