1. Promoting Payments for Ecosystem Services and related sustainable financing schemes in the Danube Basin Promoting Payments for Ecosystem Services and related sustainable financing schemes in the Danube Basin Wetlands – modern problem or forgotten old solution ? Examples of usage and developing of market mechanisms from wetlands restoration Georgi Stefanov Policy and Climate change expert WWF - Bulgaria Workshop Nisovo, 03.04.2012 Wetlands – modern problem or forgotten old solution ? Examples of usage and developing of market mechanisms from wetlands restoration Georgi Stefanov Policy and Climate change expert WWF - Bulgaria Workshop Nisovo, 03.04.2012

3. Nature park "Persina" was created in late 2000 by the Minister of Environment and Water and is one of the youngest parks in Bulgaria. Situated within three Danube municipalities Nikopol, Belene and Svishtov, with a total area of 21 762,2 ha and approximately 27 000 inhabitants. "Persina" is unique for Bulgaria and is the only park along the Bulgarian part of Danube. Declaring its objectives with conservation and restoration of Danube wetlands, with particular emphasis on preserving the natural state of numerous islands falling within the park - the islands are 24 in number, of which 5 are Romanian. There are 3 reserves, 2 natural landmarks and 1 protected area. The territory in 2007 became also a Natura 2000 site under the two directives (Habitats and Birds). In the park you can find more than 170 bird species and 450 plants species 1/3 of them directly related to the water ecosystems. The most important type of ecosystems in the park are flooded Danube forests (the Bulgarian jungles) and inland marshes. WWF has assisted the process of developing the park, and the last 10 years work in the all of it’s programs and implementing many different projects in the park area. Brief info about Persina nature park

4. Wetlands and marshes - what we know and what we don’t know about them ? Wetlands and marshes - what we know and what we don’t know about them ? Breading mosquitoes? (breeding fish) Breeding diseases? (used in medicine) Smell very bad? (methane production and use of biomass) Occupy unnecessary space for farmland? (minimum area, maximum benefits) (help for water balance, high value biodiversity, flood regulation) Other? (the highest productive ecosystems worldwide) Breading mosquitoes? (breeding fish) Breeding diseases? (used in medicine) Smell very bad? (methane production and use of biomass) Occupy unnecessary space for farmland? (minimum area, maximum benefits) (help for water balance, high value biodiversity, flood regulation) Other? (the highest productive ecosystems worldwide)

5. A) Environmental Benefits Sustainable management and use of biomass from wetlands and farmlands area of ​​ 5400 hectares (240 hectares are protected areas – “Kaikusha” marsh). Reduce the unsustainable agricultural practice of burning stubble in agricultural land and conservation of the biodiversity. Reduction of CO2 in the atmosphere associated with stubble burning and decompose of biomass in the fields / wetlands. Improve water regime of the marsh “Kaikusha” and recovery of its regulatory functions with respect to water, maintenance of fish stocks, absorption and fixation of CO2, maintaining biological diversity. Improvement of soil fertility on more than 5,000 ha of agricultural land. Improve water quality in the area of ​​ 150 ha. B) Economic benefits Creation of a business interest in the use of biomass by generating revenue from the sale of pellets and briquettes Creation of economic opportunities for users of land utilization of residues in the land as an additional source of income and the costs of collection and transmission (transport). Offering an alternative to the local population to shift from fossil fuels as coal and firewood consumption to pallets and briquettes and reduce the energy costs by an average of 30%. C) Social benefits Creation of employment among the local population by engaging them in processes of extraction and processing of biomass. Creation of jobs indirectly as an additional source of revenue for collection and transportation of raw materials. Nature Park – “Persina” and surrounding agricultural areas - creation of market scheme “biomass from wetlands” - maximum benefits for everybody

6. The scheme … Providers of ES: Farmers Providers of ES: Farmers Buyers of ES: Companies for production of pellets Buyers of ES: Companies for production of pellets biomass euro

7. Easy for connection with the other WWF programs, projects and activities in the region; High value and available area; Climate change orientated solution. Big potential for growing. Feasibilities studies show that in Bulgaria about 30% straw, 65% of cornstalks and 80% of other solid agricultural waste can be taken into account for energy production, an estimated 800,000 tons annually. Economical solution to find enough political support for wetland management and wetland restoration paid by itself. Approximately biomass production from the existing protected wetlands (40 000 hectares) by keeping nature condition (cut only 20% per year) an estimated 80,000 tons annually in production to pallets and briquettes. Why we choose to focused on biomass from wetlands and unused agriculture waste ?

8. New renewable energy sources (RES). Jobs, business, cheap heating for local people. Wetlands as a "reservoir" of carbon Biomass, in all its aspects, energy, construction, customs, traditions and culture Explore the possibilities of voluntary trading markets Energy use of biomass and Ideas for implementation in coming years

13. Amount of carbon sequestration by the most typical species (plants) of “Kaikusha” marsh (150 ha) P gC/m2/yD gC/m2/yArea haP gC/m2/yR gC/m2/y Phragmites (reed) 802617120104,380,2 Typha (bulrush) 95573521150,669,3 Schoenoplectus (sedge) 8906859127,277,2 “C” lost 20 total production 719 total respiration 499 “C” accumulation 201 Total average of 2 tones / ha / year = 600 tons Kaikusha marsh > Euro 6000 Production (P); decomposition, absorption (D); carbon accumulation (R)

14. ФондОписаниеКонтакт Multilateral Carbon Credit Fund (съвместна инициатива на ЕБВР и ЕИБ) Допустими проекти Въглеродните кредити могат да се генерират от разнообразни проекти, включително:  Енергия от ВЕИ – вятър, води, биогас, биомаса  Енергийна ефективност в индустрията (когенерация) и строителството  Избягване на аварии и изтичане при добива и обработката на природен газ и нефт.  Преминаване към въглеродно-неутрални горива  Поглъщане на емисии парникови газове (въглеродно свързване в гори) Jan-Willem van de Ven, Head of the MCCF Secretariat Phone: (+44)2073387821 (+44)2073387821 Email: vandevej@ebrd.com European Bank for Reconstruction and Development One Exchange Square, London EC2A 2JN, United Kingdomvandevej@ebrd.com Kristin Lang, Deputy Head of the MCCF Secretariat Phone: (+352)437987009 (+352) 4379 8 7009 Email: lang@eib.org European Investment Bank 100, boulevard Konrad Adenauer, L-2950 Luxembourglang@eib.org West zone Carbon manager: Haskoning, cmwest@ebrd.com cmwest@ebrd.com Prototype carbon fund на Световна банка PCF финансира разнообразни пилотни проекти за редуциране на въглеродните емисии в рамките на механизмите Чисто развитие и Съвместно изпълнение. Carbon Finance Unit, ENV The World Bank, 1818 H Street, NW, Washington, DC 20433, USA phone 202.473.9189 fax 202.522.7432 helpdesk@carbonfinance.org BioCarbon Fund на Световна банка Това е специализиран фонд на Световна банка за демонстрационни проекти, които свързват въглеродни емисии в горски екосистеми и земеделски култури. Фондът е публично-частна инициатива, администрирана от WB, която цели ценово-ефективно поглъщане на въглерод, съчетано с опазване на биоразнообразието и социални ползи. Фондът може да одобрява разнообразни проекти, свързани с подобряване на управлението на земите и горското стопанство. Такива са залесяване, попълване, редуциране на емисии от обезлесяването, земеделски ползвания. Carbon Finance Unit, ENV The World Bank, 1818 H Street, NW, Washington, DC 20433, USA phone 202.473.9189 fax 202.522.7432 helpdesk@carbonfinance.org Italian Carbon Fund (ICF) ICF финансира проекти в широк диапазон, включително въглеродно свързване. Фондът е създаден от правителството на Италия по споразумение със Световна банка. Carbon Finance Unit, ENV The World Bank, 1818 H Street, NW, Washington, DC 20433, USA phone 202.473.9189 fax 202.522.7432 helpdesk@carbonfinance.org Danish Carbon Fund Фондът обединява финансов ресурс от Правителството на Дания и няколко големи датски енергийни компании по споразумение със Световна банка Carbon Finance Unit, ENV The World Bank, 1818 H Street, NW, Washington, DC 20433, USA phone 202.473.9189 fax 202.522.7432 helpdesk@carbonfinance.org

15. № Type of the fuelCalorific valueEfficiency Price of the fuel (by 2010) Price per 1 КW 1 Diesel 11,67 KW/liter88%2.07 lv/liter0.204 2 Electricity 1 KW100%0.173lv/kw0.173 3 Nature gas 9,89 KW/m 3 90%0.9349lv/m30.105 4 Wooden chips 4.9/KW/kg90%0.36lv/kg0.081 5 Pallets from wetlands and agriculture waste 5.16/KW/kg90%0.28lv/kg0.063 Comparison table of prices of heat from different fuel types allows automation of the heating process

16. Type of culture Sown area ha Average yield per ha - ton Overall biomass production - ton Wheat and barley 140045604 Corn 2875721125 Sunflower 102733081 Reed 17901017900 TOTAL47 710 Biomass amounts of a different cultures

17. № Name of indicatorsUnit of quantity Standardized methods, validated internally lab № for the record Results form tasting Norm DIN 51731 1. Moisture%DIN 51718638-35,1 ±0,2 12 max 2. Specific heating value kcal/kgDIN 51900638-3-- 2.1 Working fuelkcal/kgDIN 51900638-34346 ±25 4181- 4657 2.2 Working fuelKJ/kgDIN 51900638-318196 ±90 17500- 19500 3. Sulfur content of dry mass %DIN 51724638-30,056 ±0,003 0,08 max 4. Balance after incineration / ash / dry weight of %DIN 51719638-35,5 ±0,1 1,5 max 5. Extraction of volatile substances on dry weight %DIN 59700638-378,2 ±0,2 - Test results of the Reed - Independent laboratory analysis – Sofia

18. Comparisons of the financial value of biomass yield in two versions: option 1 Processing of 1 ton of biomass in the village Lesidren (150 km) option 2 Processing of 1 ton of biomass in Belene (20 km) Leva per ton Production of biomass 40,00 lv. Primary processing (baling) and transport 120,00 lv.30 lv. Processing of biomass supply and delivery 200,00 lv. Labor 100,00 lv. Value of the pallets 460,00 lv.370,00 lv. Market value of conventional pellets 400,00 lv. Reserve / Balance + 40,00 lv.- 30,00 lv.

19. Economical conclusion based on the analysis and calculated potential, says that the indicators for evaluating the effectiveness of the investment and financial indicators give reason to believe that the investment is effective and the idea could be realized Net Present Value – by 33% for 10 years Internal Rate of Return – approximately by 68% Profitability Index – 6,3% Payback period – 2 years

20. Indicators of treated water, meeting the required values ​​ for the discharge of treated wastewater in accordance with national legislation in this area. Two to three times lower financial costs for construction and maintenance of such equipment compared with conventional treatment plants. Cover within the European requirements concerning the construction of treatment facilities in small settlements less than 10 000 people. Possibilities for utilization of biomass from these wetlands, such as renewable Creation of semi-natural habitats suitable for a significant part of the flora and fauna that inhabit these types of habitats. Create additional opportunities for tourism and recreation around those areas adjacent to settlements. And more benefits…: constructed wetlands as a wastewater treatment system – very suitable for small villages

21. Conclusion for wetlands  The highest - productivity ecosystems  Opportunities for additional income for local people  Diverse benefits, including all  Local energy source  Decision to costly problems such as floods and construction of treatment plants for domestic wastewater in in small settlements  Highest absorbability of C02

22. ЗАКЛЮЧЕНИЕТО ! ‘It takes a new way of thinking to solve the problems that we created by the old way of thinking’ "Трябва нов начин на мислене за решаване на проблемите, които ние сме създали поради стария модел на мислене"

23. Thank you! Georgi Stefanov gstefanov@wwfdcp.bg www.panda.org/dcpo