A synthesis of approaches to assess and value ecosystem services in the EU in the context of TEEB Vilm, 23 May 2013 Strahil Christov European Commission, DG Environment, Unit B2 (Biodiversity)

Contents Brief overview of EU Biodiversity Strategy to 2020 TEEB in the context of the Strategy Study Objectives Work Description Task 1 - Review of existing Initiatives Task 2 - Analysis and synthesis of approaches Task 3 - Develop common conceptual framework Task 4 – Recommendations

TEEB in the EU 2020 Biodiversity strategy Rationale behind biodiversity strategy 6 Sub-targets with some specific measures related to TEEB Target 2 and related measures Cross-cutting issues: Financing Involvement of the private sector By 2020, ecosystem services are maintained and enhanced by establishing Green Infrastructure and restoring at least 15% of degraded ecosystems. MS with assistance of Commission, will map and assess state of Es/ES by 2014, value such services and integrate in Accounting and Reporting Systems by 2020 Green Infrastructure Strategy by 2012 to encourage investments in GI (and RPF) No Net Loss initiative by 2015 (through compensation and offsetting schemes) Main message is that the study is about delivering on the 2nd part of Action 5. In this context we have also launched a WG on MAES to address the first part of the action and a set of 6 pilots one of which is on Natural Capital Accounting and links to the contract. Here the aim is to provide guidance to MS on how to conduct valuation and how to integrate these values into accounting systems. Most important message is that TEEB has shaped the whole EU Biodiversity Strategy. Comments on above points - Rationale behind the biodiversity strategy is inspired by TEEB: what are the benefits from biodiversity, who does it benefit/values, what are the drivers of biodiversity loss, and what measures can be taken to address them (see Impact Assessment). - That lead to the definition of 6 targets, first two one protection and enhancement of biodiversity within protected areas (target 1) and of ecosystem services in the wider landscape (target 2), also focusing on the main drivers of biodiversity loss (agriculture and forestry (target 3) , fisheries (target4), IAS (target 5), and the last one is global dimension (target 6). - Within these targets some measures are directly related to TEEB – notably target 2. The relevant measures in Target 2 are; 1) MS to map and assess state of ecosystems and their services by 2014, assess their economic value and promote the integration of these values into accounting and reporting systems at EU and national level by 2020, 2) The Commission will develop a Green Infrastructure Strategy by 2012 and work on incentives to encourage investments in GI, 3) Initiative of No net loss of ecosystems and their services (through compensation and offsetting schemes) by 2015. - TEEB recommendations are also reflected in cross-cutting issues, e.g. financing issues: diversify financing sources including through innovative financing mechanims and market-based mechanisms; generally looking to more involvement from the private sector.

Main objectives Synthesize and evaluate recent and on-going initiatives and assess the scope for integrating these for accounting and reporting at EU level Formulate steps for ES assessment and valuation into a coherent framework that can be applied by Member States Assess different approaches for up-scaling and combining ES values into an EU level assessment

Task 1: Review of Initiatives using standard format Field Name of Initiative Institutions Contact Person Email Website Established in Steps in Assessment Process Approaches Used Data sources Biomes Categorisation of ES Coverage of ES Scale of Analysis Scale of Aggregation Key strengths Key limitations Screening of reports, proceedings from workshops/meetings and websites In addition, phone/email contacts with contact persons in 15 EU MS about national initiatives Two web-based surveys with experts and stakeholders - Among TEEB conference participants Leipzig 19-22 March (n=31) - Among TEEB practitioners and experts (n=18)

Task 2: Analysis and synthesis of approaches Focus on each step in the ES assessment-valuation-accounting/ reporting process Identify best practices/data requirements/conditions for success NOT ONE SINGLE STANDARD APPROACH ! Assessment Valuation Accounting/reporting Most efforts on Mapping, some on mapping and valuation together. Very few on accounting and valuation.

Task 3: Develop common framework Develop a common practical framework and guidance for ES valuation and accounting at MS level Draw on existing initiatives and outcomes of Tasks 1 and 2 Mapping and Assessment of Ecosystems and their Services (MAES) working group UK National Ecosystem Assessment (UK NEA) European Environment Agency (EEA) Common International Classification of Ecosystem Services (CICES) System of Environmental-Economic Accounting (SEEA) Experimental Ecosystem Accounts Challenges: Existing initiatives difficult to coherently combine Missing links between steps in assessment process Scaling up of ES values

Conceptual framework Consistent with MAES framework and CICES classification Adapted from Bateman et al. (2011), Mace al. (2011) and UK NEA (2011)

Applying the Conceptual Framework: Choices

Task 4: Conclusions and Recommendations No single standard "TEEB" approach on valuation (see graph) Different definition of economic value Es/ES Most efforts on mapping ES, limited in valuation and accounting Real and hypothetical adjustments (controversial in SNA!), actual and potential ES(stock/flow), Spatial scale and variability in ES values Choices to be made by MS when applying conceptual framework Crucial to establish links between biophysical provision of ES and their economic values When integrating in national accounts, important to maintain coherence with SNA based on guidance developed by statistical offices Careful, stepwise integration via satellite accounts seems most promising way in order to keep core SNA intact. Full integration requires close collaboration between statistical offices Further integration and implementation of CICES, MAES, SEEA is needed Step forward is to launch MS initiatives, allow them to mature through monitoring and refining based on empirical experiences (MAES Pilots) CICES – Common International Classification of Ecosystem Services MAES – Mapping and Assessment of Ecosystems and their Services SEEA - System of Environmental Economic Accounting

Thank you for your attention Key document links EU Valuation Study - http://ec.europa.eu/environment/nature/biodiversity/economics/ MAES documents - http://biodiversity.europa.eu/ecosystem-assessments/european-level

Work description Task 1: Collect information on relevant initiatives at MS, EU & other levels Task 2: Analysis and synthesis of different approaches Task 3: Propose a common framework and draft recommendations Task 4: Finalize recommendations

Number of initiatives addressing each step in the assessment process Task 2: Analysis and synthesis of approaches Number of initiatives addressing each step in the assessment process

Identified research priorities TEEB conference survey 1) Development common framework 2) Improvement economic valuation methods 3) Improved insight trade-offs biodiversity & ecosystem services 4) Improved accounting practices (national and business) 5) Translation research results into practical policy action Other: creation of public awareness creation of economic incentives more focus on managed ecosystems more focus on cultural services in urban areas

Key challenges identified in expert survey Valuation Reconciling different valuation methods Lack of reliable large scale valuation studies for key ES Lack of methods linking non-monetary and monetary valuation Spatially insensitive valuation methods Uncertainty precision of values Accounting Existing valuation data often not available for well-defined ES Lack of agreed UN guidance (no proper standards) Satellite accounts or full integration in core system of NA? Differences in scales economics and ecosystems Theoretical adjustments probably impossible with real data

EU Biodiversity Strategy to 2020 2050 Vision 2020 headline target 6 Targets: A Framework for Action for the next decade 6 mutually supportive and inter-dependent targets broken down into a package of actions; -Protecting and restoring biodiversity and associated ecosystem services (targets 1 and 2) -Enhancing the positive contribution of agriculture and forestry and reducing key pressures (fisheries, IAS) on EU biodiversity (targets 3, 4 and 5) -Stepping up EU’s contribution to global biodiversity (target 6) 1 Fully implement nature legislation 2 Maintain & restore ecosystems & services 3 Increase contribution of agri. & forest. to biodiversity 4 Achieve Maximum sustainable yield 5 Combat Invasive Alien Species 6 Help avert global biodiversity loss Actions / Monitoring