How to do a Cost-Benefit Analysis in ELD: a case study from the Ethiopian Highlands Hans Hurni University of Bern

ELD Ethiopia Project Scope: Soil degradation and sustainable land management in rain-fed agriculture Location: Ethiopian Highlands Spatial scale: Multi-scale from local to national Strategic focus: Provide a spatially explicit model for cost-benefit analysis (CBA) of sustainable land management (SLM). Define further inputs for modelling the total economic value (TEV) of the Ethiopian Highlands. Inform decision-makers about best options for sustainable water and land management in Ethiopia.

3 H. Hurni 1998

Definition of Total Economic Value (TEV): “The full economic value allocated by society as a whole. This includes use value (direct and indirect, option value) and non-use value.” ELD Initiative 2013 Case study Ethiopian Highlands: -direct use value through agricultural (crop and livestock) production -indirect use value through water (and sediment) delivery for lowland irrigation -option value for ecotourism and biodiversity (e.g. wildlife) conservation -non-use value through water (and sediment) delivery for lowland irrigation

Cost-benefit analysis: “A comparison of all of the costs and benefits associated with taking action, compared to ‘business-as-usual’ (changing nothing). ” ELD Initiative 2013 ELD Ethiopia Project 2014 Spatially explicit case study of the direct agricultural use value of land in the Ethiopian Highlands: -Costs and benefits of past and actual (SWC) action -Costs and benefits of optimum (SLM) action -Costs and benefits of ‘business-as-usual’ (inaction)

Recalling the 6+1 steps to estimate the economic benefits and costs of action 1. Inception: Identification of the scope, location, spatial scale, and strategic focus of the study 2. Geographical characteristics: Assessment of quantity, spatial distribution, and ecological characteristics 3. Types of ecosystem services: Analysis of ecosystem services stocks and flows 4. Role of ecosystem services in community livelihoods and economic valuation: Role of the assessed ecosystem services in the livelihoods of the communities; role of overall economic development 5. Land degradation patterns and pressure: Identification of land degradation patterns, drivers and pressure on the sustainable management of land resources 6. Cost-benefit analysis and decision-making: Assessment of sustainable land management options +1 step: Take action! UNCCD; in ELD Methodology 2013

7 K. Herweg 1989

9 Changes in cultivated biomass and grain yield in an Ethiopian catchment (110 ha) conserved in 1983 Source: Mirka Loetscher 2003, based on SCRP data Biomass Grain

ELD Ethiopia Project Approach (2014) Component 1: Land cover classification - Land cover map at the national level - Classification approach using GIS and Remote Sensing Component 2: Detection of physical SLM structures - Data availability (high resolution Google Earth) - Automated mapping of SLM structures (remote sensing) Component 3: Assessment of soil erosion and the relationship to crop yield - RUSLE model and calibration data from field experiments - Soil erosion assessment beyond RUSLE - Relating soil erosion to soil depth and crop yield Component 4: Evaluating the costs of soil degradation and the economics of SLM practices - Implementation steps of economic valuation - Spatial valuation of SLM measures - Discussion of livelihood options

Country Report CRA Watershed Management Ethiopia Map 47, p. 168

Comparison of Landsat classi- fication (left) with high resolution Google Earth image (below left); automated mapping and quality assessment of SWC structures in Anjeni, Ethiopia (below). 0 m 600 m

Crop yield (quintal/ha) versus soil depth (cm) relationship for a crop basket in the moist Weyna Dega agroecological zone with Fanya juu soil conservation structures (example no. 23, ELD Ethiopia model) Crop yield Soil depth

1. Land cover and traditional SWC

2. Soil erosion, crop yield and current SWC

3. Optimum SLM scenario