1. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Valuation of Ecosystem Services An Integrated Hydrological and Economic Model to Value the Enhanced Nitrogen Retention in Renaturated Streams Ingo Bräuer & Rainer Marggraf Institute of Agricultural Economics University of Göttingen

2. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Contents  Introduction  The Replacement Cost Method (RCM)  General Idea and Problems at Application  Chemical Processes in the River  Modelling Changes in the Nitrogen Retention  Valuation of the Nitrogen-Retention  Practical Problems using the RCM

3. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Aims 1.Development of a user-friendly procedure to evaluate the ecosystem function N-retention to promote the use of RCM 2.Discussion of the choice of technical substitutes

4. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Case study: the enhanced N-retention in renaturated streams to evaluate a conservation program The Replacement Cost Method Valuation by comparison of an ecological function and a corresponding technical substitute

5. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Replacement Cost Method Valuation Procedure 1. Quantification of the ecosystem function Quantity Price Value X = 2. Determination of the technical substitute and its marginal costs 3. Economic benefits of the ecosystem service

6. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Replacement Cost Method Valuation Procedure 1. Quantification of the ecosystem function Quantity Price Value X = 2. Determination of the technical substitute and its marginal costs 3. Economic benefits of the ecosystem service

7. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Study Area

8. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Investigated River Jossa-Insel Distelbach Sahlensee Pfaffenhausen Oberndorf Pegel „Kreuzgrund"

9. Ingo Bräuer Institute of Agricultural Economics University of Göttingen River System 1 1 Problem Models Denitrification- Processes Non-point N-Imission point N-Imission Rates of Denitrification (Literature) Model: Behrendt & Opitz (2000) Floodplain River Influence of Beavers on the Structure of the River Increase in flooded Area Lower runnig velocity Denitrification: N-Compounds N 2 GIS

10. Ingo Bräuer Institute of Agricultural Economics University of Göttingen River System Jossa 1 1 Problem Models Denitrification- Processes Diffuse N-Imission punktuelle N-Imission Influence of Beavers on the Structure of the River +15.500 m² Increase in flooded area Floodplain River + 460 kg/a + 710 kg/a + 1.170 kgN/a Hydraulic Load +15%

11. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Valuation Procedure Quantity Price Value X = 1. Quantification Spessart: 4.700 kgN/a

12. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Valuation Procedure (RCM) 1. Quantification of the ecosystem function Quantity Price Value X = 2. Determination of the technical substitute and its marginal costs 3. Determination of the economic benefits

13. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Price Sewage Plant + similar process and output - non-point emissions - no cost-efficient alternative + similar process and output - non-point emissions - no cost-efficient alternative Replacement Costs 55 € 7,5 € 2,5 € Drinking Water + non-point and point emissions - Standard too high + non-point and point emissions - Standard too high Agricul. Politics + most efficient method - atmospheric emissions + most efficient method - atmospheric emissions Overestimation Not identical Underestimation

14. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Valuation Procedure (RCM) 2. Replacement Costs Avoidance of N-Emissions 2,5 €/kgN Quantity Price Value X =

15. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Valuation Procedure (RCM) Quantity Price Value X = 3.Economic Value 2,5 €/kgN ca. 4.700 kgN/a ca. 12.000 €/a 12%

16. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Reference-Scenario 1. Drinking Water 2. Sewage Plant 3. Agricul. Pol. 55 €7,5 €2,5 € 260.000 €/a 36.000 €/a 12.000 €/a 290 %12 %40 % Factor >20

17. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Summary  An estimation of economic values is possible  The results depend highly on the reference scenario  A transparent procedure is essential to assess the quality of the results

18. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Replacement Cost Method Self-purification of o.E. Recharge Ground Water Flood Prevention etc. Total Econ. Value Nitrogene-Retention Evaluated Compound Non- Evaluated Compounds ?

19. Ingo Bräuer Institute of Agricultural Economics University of Göttingen The investigated Program: When: 1987 Reintroduction of 18 Beavers Where: Spessart (n-w) Jossa und Sinn What: Program included Purchase of Land and Habitat-Develpoment 2001: Population of ca. 180 Ind. in severeal River systems (u.a. Kinzig)

20. Ingo Bräuer Institute of Agricultural Economics University of Göttingen Total Economic Value (TEV) Recreation Species Obs. Direct UV Ecosystem Functions Indirect UV genetic Resources Option Value Use Values Habitat Bequest V. Habitat Species Existence V. Non-Use Values TEV Species Hedonic Pricing Travel-Cost- Method Replacement Cost Method CVM