1. Valuation of nature in political decision making Experience in the Netherlands Dr.ir. E.C.M. Ruijgrok, 09/2002

2. Acidification abatement leads to increased nature quality To include this benefit in Cost Benefit Analysis: Nature must be valued in monetary terms. Nature and Acidification

3. Key questions 1. What is socio-economic valuation? - how do different views on nature determine valuation? 2. Why economic valuation of nature? - what is the role of valuation in political decisions? 3. How to determine the economic value of nature related to acidification abatement? - how much experience do we have in the Netherlands?

4. Hands- off Classical Nature development Co-evolution Functional What is the value of nature? This depends on your view! Do not value Ecological Valuation Both socio-economic and ecological valuation Financial valuation Views on nature: Valuation:

5. Financial value: Income for humans Socio-economic value: Welfare for humans, by production-, regulation-, information- and non-use functions Ecological value: Welfare for plants and animals The financial value of not exploited nature areas is very small or even zero!

6. Why valuation of nature? In general: To make the trade off between economic and ecological interests more balanced In today’s political context: To complete Cost Benefit Analyses in such a way that: they can support investments in nature they can prevent damage to nature

7. Cost Benefit Analyses Important role in national en regional infrastructural works The role of the Enviromental Impact Assessment is reduced Nature is not included in CBA’s The position of nature is deteriorating

8. Including nature in CBA Some pitfalls: Is nature valued financially of socio-economically? Are all functions of nature included? Do not replace intrinsic valuation by economic valuation; make them complementary!

9. How to determine the economic value of nature related to acidification abatement? Can unaffected nature perform this function better? Overlap? Out: functions affected by acidification In: all kinds of ecosystem functions

10. Functions affected by acidification: CO2 fixation Nitrogen storage Aluminium binding Binding heavy metals Recreational perception Non-use Different functions, different valuation methods

11. Total economic value Non-use value Use value Option/ Quasi- option value Bequest value Existence value Indirect use value Direct use value Production value Information value Regulation value Contingent Valuation Market Analysis Contingent Valuation Hedonic Pricing Travel Cost Damage cost avoided Abatement costs A combination of valuation methods:

12. Socio-economic valuation = Importance Material and immaterial welfare Representation of social preferences Willingness to pay as measurement

13. Dutch experience with valuation (1973-2002) Source: Historical overview of Dutch valuation studies

14. Platform for Economic Valuation of Nature Aim: to strengthen the position of nature, landscape, cultural heritage and environment in the public decision making process http://www.fsd.nl/naturevaluation. Network of specialists Learn from experience in other countries