TEEB and climate by Patrick ten Brink of IEEP at Delta & Climate Conf Rotterdam 30 Sep 2010

1. The Economics of Ecosystems and Biodiversity initiative
(TEEB) and Climate Change
Patrick ten Brink
TEEB for Policy Makers Co-ordinator
Head of Brussels Office, Institute for European Environmental Policy (IEEP)
Deltas in Times of Climate Change
Session DP FE 1.3
30 September 2010
13:00 – 14:45
Beurs Lounge
Rotterdam, the Netherlands

2. Presentation overview
1. Introduction
– TEEB ambitions and process and approach
– Biodiversity and Ecosystem Services
– The growing awareness of value
2. Biodiversity and climate change
– Need for climate action : coral reef emergency
– Need for BD action for climate: mitigation –
Green Carbon and REDD+
– BD and adaptation – Ecosystem based
adaption
– Investment in natural capital
– Other responses and instruments
3. Summary

3. TEEB origins
Source: Bishop (2010) Presentation at BIOECON

4. TEEB‟s Genesis and progress
“Potsdam Initiative – Biological Diversity 2010”
1) The economic significance of the global loss of
biological diversity
Sweden
Sept. 2009
Brussels
13 Nov 2009
TEEB Interim London India, Brazil, Belgium,
Report @ CBD COP- July 2009 Japan % South Africa
9, Bonn, May 2008 Sept. 2010
CBD COP 10 Nagoya Japan

5. TEEB final reports for different audiences
TEEB Ecological and
Economic Foundations (D0)
www.teebweb.org
TEEB for Policy-Makers (D1)
www.teebweb.org
TEEB for Local Policy (D2)
September 2010
TEEB for Business (D3)
July 2010
TEEB for Citizens (D4)

6. What is biodiversity?
“the variability among living organisms from all sources including, terrestrial, marine
and other aquatic ecosystems and the ecological complexes of which they are part;
this includes diversity within species, between species and of ecosystems”
(CBD 1992).
In other words, biodiversity includes:
 Diversity within species populations - genetic variation;
• The number of species, and
• The diversity of ecosystems.
Both quantity and quality of biodiversity are important when considering the links between
nature, economic activity and human well being.

7. How does Biodiversity help economic activity and
human wellbeing ? Ecosystem Services
Ecosystem services = flows of value to human societies as a result of the state and
quantity of natural capital.
• Provisioning services – e.g. wild foods, crops, fresh water and plant-derived medicines;
• Regulating services – e.g. filtration of pollutants by wetlands, climate regulation through
carbon storage and water cycling, pollination and protection from disasters;
• Cultural services – e.g. recreation, spiritual and aesthetic values, education;
• Supporting services – e.g. soil formation, photosynthesis and nutrient cycling.
(MA 2005)
From an economic point of view, the flows of ecosystem services can be seen as the
„dividend‟ that society receives from natural capital.
Maintaining stocks of natural capital allow the sustained provision of future flows of
ecosystem services, and thereby help to ensure enduring human well-being.

8. Biodiversity and ecosystem services
Biodiversity „Quality‟ „Quantity‟ Services (examples)
Ecosystems Variety Extent • Recreation
• Water regulation
• Carbon storage
Species Diversity Population • Food, fibre, fuel
• Design inspiration
• Pollination
Genes Variability Number • Medicinal discovery
• Disease resistance
• Adaptive capacity
Source: Bishop (2010) Presentation at BIOECON

9. Links from Drivers to ecosystem functions
to impacts and wellbeing
Drivers Pressures State Impact
(Human)
Drivers
Human
e.g. Wellbeing
changes in &
land use,
Natural climate change, Biodiversity
Drivers pollution,
Ecosystem Economic
water use,
Services Value
invasive alien
species (IAS)
Policies
Nat. Reg.
Loc. Int. Ecosystem
functions
Response

10. Critical issues
The values of biodiversity and ecosystems are missing
• Many not known (but this is changing); widespread lack of awareness
• They are generally not integrated into the economic signals, into markets – the
economy is therefore often not part of the solution
• Values are not taken systematically into account in assessments and decision
making
• The value of nature is not reflected in national accounts nor in leading macro
economic indicators
Inappropriate incentives; misinterpretation of right solutions, insufficient
evidence base at policy makers‟ finger tips and weaker public support for action
There is not enough political will or conviction or awareness of benefits/cost to
launch due policies
Biodiversity loss continues – eroding natural capital base without realising its
value

11. The Global Loss of
Biodiversity
2000
Source: L Braat presentation COP9 Bonn May 2008 on the COPI Study; building on MNP data

12. The Global Loss of
Biodiversity
2050
Source: L Braat presentation COP9 Bonn May 2008 on the COPI Study; building on MNP data

13. TEEB for Policy Makers report
The Global Biodiversity Crisis
• Coral reef emergency
• Deforestation
• Loss of public goods…
Measuring what we manage
• BD & ecosystem service indicators
• Natural capital accounts
• Beyond GDP indicators et al
Available Solutions
• PES water, PES – REDD+
• Markets, GPP
• Subsidy reform
• Legislation, liability, taxes & charges
• Protected Areas
• Investment in natural capital et al
http://www.teebweb.org/
Responding to the value of nature

14. Part I: The Opportunity
Chapter 1: The Value of Nature for Local Development
Part II: The Tools
Chapter 2: Conceptual Frameworks for Considering the Benefits of
Nature
Chapter 3: Tools for Valuation and Appraisal of Ecosystem
Services in Policy Making
Part III: The Practice
Chapter 4: Ecosystem Services in Cities and Public Management
Chapter 5: Ecosystems Services in Rural Areas and Natural
Resource Management
Chapter 6: Spatial Planning and Environmental Assessments
Chapter 7: Ecosystem Services and Protected Areas
Chapter 8: Payments for Ecosystem Services and Conservation
Banking
Chapter 9: Certification and Labelling
Part IV: Conclusion
Chapter 10: Making Your Natural Capital Work for Local
Development
Overview of tools and databases

15. “I believe that the great part of miseries of mankind are brought upon them
by false estimates they have made of the value of things.”
Benjamin Franklin, 1706-1790
“There is a renaissance underway, in which people are waking up to
the tremendous values of natural capital and devising ingenious ways
of incorporating these values into major resource decisions.”
Gretchen Daily, Stanford University

16. Multiple benefits from ecosystems
Provisioning services Many services from the same resource
• Food, fibre and fuel
• Water provision
• Genetic resources
Regulating Services
• Climate /climate change regulation
• Water and waste purification
• Air purification
• Erosion control
• Natural hazards mitigation
• Pollination
• Biological control
Cultural Services
• Aesthetics, Landscape value, recreation and
tourism
• Cultural values and inspirational services
Supporting Services
• Soil formation Important to appreciate the whole set of
eco-system services
+ Resilience - eg to climate change

17. ‘We never know the worth of water 'til the well is dry’. ‘
English proverb
‘Men do not value a good deed unless it brings a reward’
Ovid, B.C. 43 – 18 A.D., Roman Poet

18. Ecosystem Services and awareness of values
Provisioning services
Market values – known and generally taken into account in decision
• Food, fibre and fuel making on land use decisions
• Water provision
• Genetic resources Value historically often overlooked; private sector exceptions
Regulating Services
• Climate /climate change regulation Value long ignored, now being understood >> new
instruments, markets, investments
• Water and waste purification
• Air purification
Value often appreciated only after loss/damage felt
• Erosion control
• Natural hazards mitigation
Value often appreciated only after service gone >>
• Pollination Replacement/substitute costs
• Biological control
Cultural Services
• Aesthetics, Landscape value, recreation and Sometimes value explicit / implicit in markets
tourism (e.g. tourism spend / house prices)
• Cultural values and inspirational services
Values generally rarely calculated
Supporting Services - e.g. soil formation
Habitat Services - e.g. nurseries The benefits to our economies, livelihoods and wellbeing have
generally not been taken into account. There is, however, now a
+ Resilience - e.g. to climate change new awareness of the value of ecosystem services and a growing
use of instruments to reward benefits.

19. Multiple Benefits: at the Urban level – City of Toronto
• Estimating the value of the Greenbelt for the City of Toronto
• The greenbelt around Toronto offers $ 2.7 billion worth of non-market ecological
services with an average value of $ 3, 571 / ha.
→ Implication re: future management of the greater city area ?
Ecosystem Annual Value
Valuation Benefits (2005, CDN $)
Carbon Values 366 million
Air Protection Values 69 million
Watershed Values 409 million
Pollination Values 360 million
Biodiversity Value 98 million
Recreation Value 95 million
Agricultural Land 329 million
Value
Source: Wilson, S. J. (2008)
Map: http://greenbeltalliance.ca/images/Greebelt_2_update.jpg

20. Taking account of public goods
…can change what is the “right” decision on land/resource use
US$ Based only on private gain, the “trade-off” Shrimp Farm
/ha/yr choice favours conversion….. Mangroves
$12,392/ha
10000
$9632/ha
After
Adding Storm
Public protection
5000 Benefits
From
mangroves
$1220/ha Fishery
$584/ha nursery
$584/ha
private profits private private
0 profits profits Net of public
less costs of
subsidies restoration
needed
after 5 years
If public wealth is included, the “trade-off”
choice changes completely…..
-ve $11,172/ha
>> fundamental rationale for public policy Source: Barbier et al, 2007

21. Presentation overview
1. Introduction
– TEEB ambitions and process and approach
– Biodiversity and Ecosystem Services
– The growing awareness of value
2. Biodiversity and climate change
– Need for climate action : coral reef emergency
– Need for BD action for climate: mitigation –
Green Carbon and REDD+
– BD and adaptation – Ecosystem based
adaption
– Investment in natural capital
– Other responses and instruments
3. Summary

22. TEEB Climate Issues Update
Coral reef emergency
Forest carbon for climate
mitigation
National accounting for
forest carbon
Ecosystem investment for
climate adaptation

23. Coral Reefs
•Major coral reef loss already happening given temperature rise to date.
•Need as ambitious commitments as possible for GHG emissions reductions -
450ppm and 2 degrees already accepting major losses

24. WHAT WE LIKE TO THINK ALL CORAL REEFS LOOK LIKE….

25. WHAT CORAL REEFS INCREASINGLY LOOK LIKE….

26. Coral Reef valuations thresholds…
• Coral Reef Services (per hectare) can have very high values
• global valuation studies place the value as high as US$ 172 billion
per annum
• Over 500 million people a year dependent on the services from reefs
• however…. Coral Reefs are an ecosystem at the threshold of
irreversibility
• ethical choice coming up : stabilization targets …
– at 450 ppm CO2 for 2 degrees
– at 350 ppm CO2 for Coral Reef survival in the long term

27. “Playing the full hand” of carbon colours
• Brown Carbon
– CO2 emissions from human energy use and industry
• Green Carbon
– carbon stored in terrestrial ecosystems, e.g. plant biomass and soils in
forests, agricultural lands, wetlands and pasture
• Blue Carbon
– 55% of all carbon in living organisms are stored in oceans, most of this in
mangroves, marshes, see grasses, coral reefs and macro-algae
• Black Carbon
– soot emissions from incomplete combustion of fuels absorb heat in the
atmosphere and reduce ability to reflect sunlight
 By halting the loss of “green” and “blue” carbon, the world could
mitigate as much as 25% of total GHG emissions, with co-benefits for
biodiversity, food security and livelihoods (IPCC 2007, Nellemann et al. in press)

28. Tropical forests of the world:
largest terrestrial carbon sinks

29. Areas of rapid land use cover change

30. The role of tropical forests in climate regulation
• tropical forests store a fourth of all terrestrial carbon
– 547 gigatonnes (Gt) out 2,052 Gt (Trumper et al. 2009)
• tropical forest capturing
– up to 4.8 Gt CO2 annually! (Lewis & White 2009)
• stopping deforestation holds an excellent cost-benefit
ratio
– halving deforestation generates net benefits of about
$ 3.7 trillion (NPV) including only the avoided damage costs of
climate change (Eliasch Review 2008)
30

31. REDD-Plus: Reducing Emissions from Deforestation and Forest
Degradation-Plus
Major potential for this instrument to address Green carbon
• Curb deforestation/degradation - deforestation ~17% of global GHG emissions
• Could offer substantial biodiversity co-benefits: range of ecosystem services
• Eliasch (2008) estimated that REDD could lead to a halving of deforestation rates by 2030
and have an estimated long-term net benefit of US$3.7 trillion in present value terms
• One of the few areas given fairly solid support at the UNFCCC’s Copenhagen COP
• Many risks that need to be addressed: carbon leakage, additionality, permanence,
biodiversity impacts (carbon only focus; plantations), competition for land
Needs:
Confidence: monitoring & verification; natural capital accounts
Experience: pilot projects, capacity building, monitoring solutions
Investment: money for the projects and payments.
Evolution: phasing from pilot, to funds, to market links….

32. Investment in ecological infrastructure
Ecological infrastructure key for adaptation to climate change
• Afforestation: carbon store+ reduced risk of soil erosion & landslides
• Wetlands and forests and reduced risk of flooding impacts
• Mangroves and coastal erosion and natural hazards
• Restore Forests, lakes and wetlands to address water scarcity
• Coral reefs as fish nurseries for fisheries productivity / food security
• PAs & connectivity to facilitate resilience of ecosystems and species
From local to national to EU efforts
Global responsibility / contribution

33. Nature-based climate change mitigation in Germany
• drainage of 930,000 ha peatlands in Germany for agriculture cause
emissions of 20 Mio. t of CO2-eq. per year
• total damage of these emissions amounts to 1.4 billion €
• peatland restoration: low cost and biodiversity friendly mitigation option
Mecklenburg-Vorpommern:
• pilot project between 2000-2008
• restoration of 30,000 ha (10%)
• emission savings of up to 300,000 t CO2-eq.
• avoidance cost of 8 to 12 € / t CO2
• if alternative land use options are realized
(extensive grazing, reed production or alder
forest) costs decrease to 0 to 4 € / t CO2
• where Maize can be grown restoration can not
compete
Restored peatland in Trebeltal 2007
Source: Federal Environmental Agency 2007; MLUV MV 2009; Schäfer 2009
Foto: D. Zak, http://www.fv-berlin.de

34. Investments in Ecological Infrastructure
• restoration can be cost effective way of
providing a service :
planting mangroves along coastline in Vietnam cost
$1.1 million but saved $ 7.3 million annually in
dyke maintenance (GRID-Arendal 2002; Reid and Huq
2005)

35. Protected Areas (PAs)
• Better managed, better connected, better governed and better
financed protected areas are recognised as key to both mitigation and
adaptation responses to climate change.
• Climate change mitigation: 15% of global terrestrial carbon stock is
contained in protected areas (Campbell et al.2008).
• Adaptation: help people adapt - maintaining ecosystem services that reduce
natural disaster impacts (coastal and river protection, control of desertification), stabilise
soils and enhance resilience to changing conditions.
Finalisation of the networks (in EU – notably MPAs - & globally)
Address financing gap – new funding, new instruments (eg PES)
In EU: use of funding – better integration (EAFRG, LFA, EFRD etc)
New Biodiversity fund ?

36. Subsidy Reform : Win-win biodiversity & climate
1 trillion US$/year spent on subsidies – value for money ?
Establish transparent and comprehensive subsidy inventories
Develop prioritised plans of action for subsidy removal or reform,
for implementation in the medium term

37. “Imaginary public goods of avoided public bads”
- Biofuels
 Early stated ambitions: helping avoid climate
change – avoiding a public bad.
 Subsidies in many forms launched
 US$ 11/yr („06: US+EU+Canada) (GSI 2007, OECD 2008)
 Cost of reducing CO2 ~ US$ 960 to 1700/tCO2
equiv. (OECD 2008)
Not cost effective cf EU-ETS: ~ US $ 30-50 / t
Where biofuels fom converted forrest lands –
there may be net increase of emissions
Effect opposite to stated objective.
Urgent need to review biofuels policies / instruments

38. Natural resource management & spatial planning
• Flooding of River Elbe, Germany (2002)
• Damage over EUR 2 billion
• Assessment that flood damage (+ cost of dams) by far exceed costs of upstream flooding
arrangements with land holders
→ The value of upstream ecosystems in regulating floods was re-discovered !
→ Local authorities start changing spatial planning & seeking arrangements upstream

39. River Elbe flooding, Germany
Step 1: Specify and agree on the problem
• August 2002 heavy floods of the river Elbe, direct economic damage of over 9 billion €
• occasion to revise system of flood protection
towards integrated flood risk management © DPA
Step 2: Which ecosystem service are relevant
• flood protection
• habitat for a multitude of species
• nutrient retention
Step 3: Define information needs and select methods
• CBA of different alternatives (relocate dykes, establish polder)
• replacement costs for assessment of the nutrient and pollutant filters
• contingent valuation for the willingness to pay for flood control

40. Step 4: Conduct the assessment
• relocation of the dykes creates a new flood retention
area of just 35,000 ha of land
• establish polder includes the creation of a surface of
3,248 ha
• combination of both measures with dike relocations
(3402 ha) and steered polders (4143 ha)
Step 5: Identify and appraise policy options
• all options have a positive benefit-cost-ratio if
environmental benefits are included in the calculation
• BCR: - relocation of the dykes = 3.1
- establish polders = 9.9
- combination = 4.6
Step 6: Assess the distributional impacts of policy
response
• Maps are being made that indicate economic losses and
social impacts involved in flooding
© Grossmann, M.; Hartje, V.; Meyerhoff, J.
Sources: Grossmann, M., Hartje, V., Meyerhoff, J. (2010) Ökonomische Bewertung
naturverträglicher Hochwasservorsorge an der Elbe. Naturschutz und Biologische
Vielfalt 89, Bundesamt für Naturschutz: Bonn.

41. TEEBcases – online accessible best
practice examples
• final version will
contain more than
100 cases from
around the world
• showcasing the
incorporation of
economic valuation
into local decision-
making
• In cooperation with
EEA - accessible via
teebweb.org
http://www.eea.europa.eu/teeb/map

42. The Business Angle: Aspirations/objectives
From carbon neutral …
… to biodiversity positive
• Danone Group: “Attain carbon neutrality for the major Danone brands,
including Evian, by the end of 2011.”
• Marks & Spencer: “Our goal is to become carbon neutral by 2012 in our UK
and Republic of Ireland operations.”
• Coca Cola: “Our goal is to safely return to communities and nature an amount of
water equivalent to what we use in all of our beverages and their production.”
• BC Hydro: “long-term goal of no net incremental environmental impact.”
• Walmart: “Committed … to permanently conserve at least one acre of
priority wildlife habitat for every developed acre.”
• Rio Tinto: “Our goal is to have a „net positive impact‟ on biodiversity.”
Source: Bishop (2010) Presentation at BIOECON

43. Biodiversity and Climate
• Important synergies: win-wins for the two.
• Cannot address climate without biodiversity - mitigation & adaptation
• Or address biodiversity without addressing climate – e.g. corals, IAS
• Avoid partial solutions that focus only on part of the picture - eg wrong
REDD design/implementation; biofuels subsidies that encourage land conversion)
• Moving to a low-carbon economy critical
• This is only part of the solution – need to move to a resource efficient
economy & work within natures resource and ecosystem limits
• With 9 billion people in 2050, a lot of resource boundaries and ecosystem
thresholds risk being crossed.
• Need systematic use of windows of opportunity at global to local
levels, and realise policy synergies and avoid policy disconnect
• Taking account of the services from, and values of, nature in
decisions will be essential and cost effective.

44. Thank you
Where do you see particular needs and opportunities for working with
nature for Delta cities in Times of Climate Change?
TEEB Reports available on http://www.teebweb.org/
& TEEB in Policy Making will come out as an Earthscan book in March 2011
`
Patrick ten Brink, ptenbrink@ieep.eu
IEEP is an independent, not-for-profit institute dedicated to the analysis,
understanding and promotion of policies for a sustainable
environment in Europe www.ieep.eu
Manual of EU Environmental Policy:
http://www.earthscan.co.uk/JournalsHome/MEEP/tabid/102319/Default.aspx