VALUING ECOSYSTEM SERVICES
TOWARD BETTER ENVIRONMENTAL DECISION–MAKING
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NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance.
Support for this project was provided by the U.S. Environmental Protection Agency under Award No. X-82872401; U.S. Army Corps of Engineers Award No. DACW72-01-P-0076; U.S. Department of Agriculture, Cooperative State Research, Education, and Extension Service under Award No. 2001-38832-11510; U.S. Department of Agriculture-Research, Education, and Economics, Agricultural Research Service, Administrative and Financial Management, Extramural Agreements Division under Award No. 59-0790-1-136. Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of the organizations or agencies that provided support for the project.
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COMMITTEE ON ASSESSING AND VALUING THE SERVICES OF AQUATIC AND RELATED TERRESTRIAL ECOSYSTEMS
GEOFFREY M. HEAL, Chair,
Columbia University, New York
EDWARD B. BARBIER,
University of Wyoming, Laramie
KEVIN J. BOYLE,
University of Maine, Orono
ALAN P. COVICH,
University of Georgia, Athens
STEVEN P. GLOSS,
Southwest Biological Science Center, U.S. Geological Survey, Tucson, AZ
CARLTON H. HERSHNER,
Virginia Institute of Marine Science, Gloucester Point
JOHN P. HOEHN,
Michigan State University, East Lansing
CATHERINE M. PRINGLE,
University of Georgia, Athens
University of Minnesota, St. Paul
University of Connecticut, Storrs
University of Notre Dame, Notre Dame, Indiana
National Research Council Staff
MARK C. GIBSON, Study Director
ELLEN A. DE GUZMAN, Research Associate
WATER SCIENCE AND TECHNOLOGY BOARD
R. RHODES TRUSSELL, Chair,
Trussell Technologies, Inc., Pasadena, California
MARY JO BAEDECKER,
U.S. Geological Survey (Retired), Vienna, Virginia
GREGORY B. BAECHER,
University of Maryland, College Park
JOAN G. EHRENFELD,
Rutgers University, New Brunswick, New Jersey
Massachusetts Institute of Technology, Cambridge, Massachusetts
GERALD E. GALLOWAY,
Titan Corporation, Reston, Virginia
Pacific Institute for Studies in Development, Environment, and Security, Oakland, California
CHARLES N. HAAS,
Drexel University, Philadelphia, Pennsylvania
KAI N. LEE,
Williams College, Williamstown, Massachusetts
CHRISTINE L. MOE,
Emory University, Atlanta, Georgia
National Audubon Society, New York, New York
JERALD L. SCHNOOR,
University of Iowa, Iowa City
Resources for the Future, Washington, DC
KARL K. TUREKIAN,
Yale University, New Haven, Connecticut
HAME M. WATT,
Independent Consultant, Washington, DC
University of Maryland, Baltimore County
JAMES L. WESCOAT, JR.,
University of Illinois at Urbana-Champaign
STEPHEN D. PARKER, Director
LAURA J. EHLERS, Senior Staff Officer
MARK C. GIBSON, Senior Staff Officer
JEFFREY W. JACOBS, Senior Staff Officer
WILLIAM S. LOGAN, Senior Staff Officer
LAUREN E. ALEXANDER, Staff Officer
STEPHANIE E. JOHNSON, Staff Officer
M. JEANNE AQUILINO, Financial and Administrative Associate
ELLEN A. DE GUZMAN, Research Associate
PATRICIA JONES KERSHAW, Study/Research Associate
ANITA A. HALL, Administrative Assistant
DOROTHY K. WEIR, Senior Project Assistant
The development of the ecosystem services paradigm has enhanced our understanding of how the natural environment matters to human societies. We now think of the natural environment, and the ecosystems of which it consists, as natural capital—a form of capital asset that, along with physical, human, social, and intellectual capital, is one of society’s important assets. As President Theodore Roosevelt presciently said in 1907,
The nation behaves well if it treats the natural resources as assets which it must turn over to the next generation increased and not impaired in value.1
Economists normally value assets by the value of services that they provide: Can we apply this approach to ecological assets by valuing the services provided by ecosystems?
An ecosystem is generally accepted to be an interacting system of biota and its associated physical environment. Aquatic and related terrestrial ecosystems are among the most important ecosystems in the United States, and Congress through the Clean Water Act has recognized the importance of the services they provide and has shown a concern that these services be restored and maintained. Such systems intuitively include streams, rivers, ponds, lakes, estuaries, and oceans. However, most ecologists and environmental regulators include vegetated wetlands as aquatic ecosystems, and many also think of underlying groundwater aquifers as potential members of the set. Thus, the inclusion of “related terrestrial ecosystems” for consideration in this study is a reflection of the state of the science that recognizes the multitude of processes linking terrestrial and aquatic systems.
Many of the policies implemented by various federal, state, and local regulatory agencies can profoundly affect the nation’s aquatic and related terrestrial ecosystems, and in consequence, these bodies have an interest in better understanding the nature of their services, how their own actions may affect them, and what value society places on their services. The need for this study was recognized in 1997 at a strategic planning session of Water Science and Technology Board (WSTB) of the National Research Council (NRC). The Committee on Assessing and Valuing the Services of Aquatic and Related Terrestrial Ecosystems was established by the NRC in early 2002 with support from the U.S. Environmental Protection Agency (EPA), U.S. Army Corps of Engineers
(USACE), and U.S. Department of Agriculture (USDA). Its members are drawn from the ranks of economists, ecologists, and philosophers who have professional expertise relating to aquatic ecosystems and the valuation of ecosystem services.
In drafting this report the committee members have sought to understand and integrate the disciplines, primarily ecology and economics, that cover the field of ecosystem service valuation. In fact, the committee quickly discovered that this is not an established field—ecologists have only recently begun to think in terms of ecosystem services and their determinants, while economists have likewise only very recently begun to incorporate the factors affecting ecosystem services into their valuations of these services. If we as a society are to understand properly the value of our natural capital, which is a prerequisite for sensible conservation decisions, then this growing field must be developed further and this report provides detailed recommendations for facilitating that development. Although the field is relatively new, a great deal is understood, and consequently the committee makes many positive conclusions and recommendations concerning the methods that can be applied in valuing the services of aquatic and related terrestrial ecosystems. Furthermore, because the principles and practices of valuing ecosystem services are rarely sensitive to whether the underlying ecosystem is aquatic or terrestrial, the report’s various conclusions and recommendations are likely to be directly, or at least indirectly applicable to valuation of the goods and services provided by any ecosystem.
The study benefited greatly from the knowledge and expertise of those who made presentations at our meetings, including Richard Carson, University of California, San Diego; Harry Kitch, USACE; John McShane, EPA; Angela Nugent, EPA; Michael O’Neill, USDA; Mahesh Podar, EPA (retired); John Powers, EPA; Stephen Schneider, Stanford University; and Eugene Stakhiv, USACE Institute for Water Resources. The success of the report also depended on the support of the NRC staff working with the committee, and it is a particular pleasure to acknowledge the immense assistance of study director Mark Gibson and WSTB research associate Ellen de Guzman. Finally, of course, the committee members worked extraordinarily hard and with great dedication, expertise, and good humor in pulling together what was initially a rather disparate set of issues and methods into the coherent whole that follows.
This report was reviewed in draft form by individuals chosen for their diverse perspectives and technical expertise in accordance with the procedures approved by the NRC’s Report Review Committee. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published report as sound as possible and to ensure that the report meets institutional standards for objectivity, evidence, and responsiveness to the study charge. The review comments and draft manuscript remain confidential to protect the integrity of the deliberative process. We wish to thank the following individuals for their review of this report: Mark Brinson, East Carolina University, Greenville, North Carolina; J. Baird Callicott, University of North Texas, Denton; Nancy Grimm, Arizona State University, Tempe;
Michael Hanemann, University of California, Berkeley; Peter Kareiva, The Nature Conservancy, Seattle, Washington; Raymond Knopp, Resources for the Future, Washington, D.C.; Sandra Postel, Global Water Policy Project, Amherst, Massachusetts; and Robert Stavins, Harvard University, Cambridge.
Although the reviewers listed above have provided many constructive comments and suggestions, they were not asked to endorse the conclusions or recommendations, nor did they see the final draft of the report before its release. The review of this report was overseen by John Boland, Johns Hopkins University, Baltimore. Appointed by the National Research Council, he was responsible for making certain that an independent examination of the report was carefully carried out in accordance with institutional procedures and that all review comments were carefully considered. Responsibility for the final content of this report rests entirely with the authoring committee and the NRC.
Geoffrey M. Heal, Chair