Table 1 Watershed PES
From: The global status and trends of Payments for Ecosystem Services
PES mechanism (category) | Definition | Example | Market size 2009 → 2015 | Programmes 2005 → 2015 | Distribution (number of countries) |
|---|---|---|---|---|---|
Subsidy watershed PES (government-financed) | Public finance rewards land managers for enhancing or protecting ecosystem services. The funders do not directly benefit from the management activities. | Chinese government’s Sloping Lands Conversion Program pays farmers to stop cultivating on steep slopes. Roughly 53 million farmers receive compensation to improve water quality and flood control. | $6.3 billion → $23.7 billion (US$12.98 billion in China) | 17 → 139, with 69 in China | 39 |
Collective action watershed PES (user- and government-financed) | An institution pools resources from multiple water users (private parties, NGOs, government bodies) to pay upstream landowners for management actions that provide water quality and other benefits. | Quito’s Water Conservation Fund relies on a 1% surcharge on monthly water bills and monies from local electrical utility and beer company directed to finance projects protecting forests and grasslands in the watershed. | US$402 million → US$564 million | 16 → 86 | 22 |
Bilateral watershed PES (user- and government-financed) | A single water user compensates one or more parties for activities that deliver hydrological benefits to the payer or serves to mitigate impacts from their activities. | In the 1990s, New York City raised a bond to pay for land-use changes in the Catskills and Delaware watersheds to ensure the quality of their drinking water at much lower cost than installing a treatment plant. | US$13 million → US$93 million | 19 → 111 | 27 |
Instream buybacks (user- and government-financed) | Water rights are purchased or leased from historic rights holders and retired, which leaves the water in-stream to deliver water-quality benefits and ensure healthy ecological flows. | In Australia, the Restoring the Balance programme committed over $3 billion over a ten-year period to purchase water entitlements from farmers to ensure instream flows in the Murray–Darling Basin. | US$25 million → US$60.7 million | 15 → 20, with 18 in the United States | 3 |
Quality trading and offsets (compliance) | Water service providers comply with regulations by paying landowners for activities that improve a measure of water quality (such as nutrients, salinity or temperature) in exchange for credits. | In the Hunter River Salinity Trading Scheme, salt credits are traded among mines and power stations based on river conditions to control the salinity. | US$8.3 million → US$22.2 million | 10 → 31, with 29 in the United States | 3 |
