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Ina Porras and
Nigel Asquith,
2018Author name
Date
Ina Porras and
Nigel Asquith,
2018
MODULE 1: CONTEXT
Ecosystems,
poverty
alleviation and
conditional
transfers
Ina Porras and Nigel Asquith, 2018
http://pubs.iied.org/16639IIED/
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Ina Porras and
Nigel Asquith,
2018
A set of four modules for
practitioners and trainers
1Context
2Experiences
3Financing
4Implementation
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Ina Porras and
Nigel Asquith,
2018Module 1: outline
Definitions: PES and conditional
transfers
Externalities
Poverty alleviation
Enabling conditions for scaling up
Examples
4
Ina Porras and
Nigel Asquith,
2018Conditional transfers
• CTs are social benefits used by governments to address welfare.
• Target individuals economically at risk, chronically poor and/or socially vulnerable.
• Designed to have impacts on wellbeing: • Short-term: through direct cash injection
• Long-term: improving health when linked to ‘actions’, such as visiting a clinic
• Multiplier benefits: such as pushing the demand for better education facilities
Payments for Ecosystem Services are a form of CT linked to environment
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Payments for Ecosystem Services
Source: Menton and Barrett (2018), ESPA book
Focus Definition
International
organisations
•Brundtland Report (1987): we should economically reward resource managers for the provision of ecosystem services and are thus
characterised by (i) an ecological function subject to trade; (ii) the establishment of a standard unit of exchange; (iii) and supply,
demand and intermediation flows between those who sell and buy ecosystem services.
•World Bank: The central principles of PES are that those who provide environmental services should be compensated for doing s o
and that those who receive the services should pay for their provision (Pagiola and Platais, 2007).
•OECD (2010): PES is a direct and flexible incentive-based mechanism under which the user or beneficiary of an ecosystem service
makes a direct payment to an individual or community whose land use decisions have an impact on the ecosystem service provisi on.
•For Global Environmental Facility (GEF), the PES concept has been about arrangements between buyers and sellers of
environmental goods and services in which those that pay are fully aware of what it is that they are paying for, and those th at sell are
proactively and deliberately engaging in resource use practices designed to secure the provision of the services. ... The ado ption of a
wide-angle view of PES by the GEF is further justified by the fact that the different GEF Agencies have adopted different defini tions of
PES (Cavelier and Gray, 2014)
Focus on
economic
component
•Wunder (2005): Payments for Environmental Services defined as “a voluntary transaction where a well -defined ES (or land-use likely
to secure that service) is being ‘bought’ by a (minimum one) ES buyer from a (minimum one) ES provider if and only if the ES provider
secures ES provision (conditionality)”. He revised his definition ten years later as “voluntary transactions between service users and
service providers that are conditional on agreed rules of natural resource management for generating offsite service” (Wunder, 2015)
•Engel (2015): Two basic types of PES can be distinguished Coasean PES result from a direct negotiation between ES beneficiaries
and ES providers and Pigouvian PES resemble an environmental subsidy, where payments are made by a government agency out of
earmarked user fees (e.g., a water charge) or general tax funds... Many existing PES schemes represent hybrids of the two typ es.
•Reed et al (2017). This definition extends Wunder (2015) definition of PES, providing three additional components relating to: multi -
level governance; bundling or layering services across multiple scales; and shared values for ecosystem services.
Justice, equity
and poverty
focus
•Muradian et al (2010) PES as a transfer of resources between social actors, which aims to create incentives to align individual and/or
collective land use decisions with the social interest in the management of natural resources.
•Farley & Constanza (2010) – adapt Muradian et al’s definition because it is ‘more in line with ecological economics, in which
ecological sustainability and just distribution take precedence over market efficiency in furthering social interests’
•Kosoy and Corbera (2010): the narrow definition of Wunder (2005) is problematic because it excludes a variety of PES schemes
operating under different principles, with ill-defined ecosystem services or under inefficient provision levels… PES can in turn alleviate
poverty and establish a new ‘urban–rural compact’ by transferring funds from ‘consumers’ to ‘providers’ of these services
•Vatn (2010): PES, as defined by Wunder (2005), is more like a theoretical reference point. It does not emphasize the specific
problems involved when creating a market for environmental services, specifically how transaction costs influence the format of
payments. PES reliance on state/NGO engagement (to clarify property rights, as intermediaries) means that in practice it is n ot a
market-mechanism.
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Ina Porras and
Nigel Asquith,
2018High levels of academic research on PES.
Check Engel (2015) and Wunder (2015) for detailed review
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Ina Porras and
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2018
PES as conditional transfersEconomic incentives provide motivations
to behave in certain ways. They include subsidies, conditional and/or unconditional transfers, and integrated
tools such as ICDPs. Economic “disincentives” –e.g. taxes, charges, aim
at curbing negative behaviour.
Conditional transfers introduce
“conditionality” to the incentive.
PES are a form of CTs used to introduce positive rewards to better environmental
management.
“PES-like” deals involve various types of
institutional arrangements -they often have conditional and/or unconditional
components,
“Purist” PES (e.g. defined Wunder 2005)
are a subcomponent of these agreements. Wunder (2015) revised his
definition, which features conditionality as a key element of the incentive.
Economic incentives
“family”
Conditional
transfers
(CT)“PES-like” deals
“Purist”
PES
Source: Focus group at ESPA Science Conference, Edinburgh 2017
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2018
Externality
(private)
Benefit to
ecosystem
manager
Present Ecosystem
Management
Desired ecosystem
Management
(e.g. conservation)
Source: Pagiola and Platais, 2007; Engel et al., 2008).
Private benefit PES/
compensation
(social)
externality to
downstream
ES users/
beneficiaries
Users pay
Land use
Be
ne
fits
/co
sts
PES and externalities1. Existing payoffs
do not reflect value
of ES, making
conservation
unattractive
2. Lack of ES
provision results in
negative
environmental
externality
3. “User-pay”
principle
suggests that
those who
benefit from ES
pay for their
provision
4. The incentive
from ES (“provider
gets”) helps make
conservation more
attractive
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Ina Porras and
Nigel Asquith,
2018Conditionality
Politically attractive
Links an incentive (e.g. payment) to an outcome (e.g. number of hectares, number of jobs)
Linked to:
• Understanding to causality (science)
• Institutions and context
• Compliance and enforcement
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Ina Porras and
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2018
Poverty levels
Unconditional
transfers
Ecosyste
m im
port
ance
Conditional
transfers
Hig
hL
ow
Ultra poor Medium poor Better-off
Including direct interventions
through job creation, and
indirect through behavioural
change (PES, eco-
compensation, REDD+)
where incentives can tip the
balance of cost of
engagement.
Regulation/
PES?
None/
education/
prevention
None
Other
instruments
to reach the
ultra-poor
alongside other measures
e.g. addressing
institutional gaps and
drivers for deforestation.
ideally used for wealthier
members of society,
without having to
provide incentives.
PES, conditionality and poverty
alleviation
Adapted from Rodriguez et al (2011)
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Why link to poverty
alleviation?Nature benefits people (e.g. MEA, 2005; TEEB 2011)
Frameworks and evidence that show poor and vulnerable people are more reliant on ecosystems and their services (e.g. Diaz et al, 2015; Fisher et al 2014)
Natural capital and green growth links nature to wealth
Convergence provides a fresh entry point to mainstream P&E into policies, design instruments that deal with multiple objectives and trade-offs.
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Ina Porras and
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2018PES in the practice
Targeting
those who
provide the
ES
Intermediary
Impacts on ES beneficiaries(externalities)
Consumption/
wellbeing
Inputs to
production
Industry, private sector, water utilities, municipalities, tourism
operators, domestic and international
Financial
flowsAims at ‘cashing
in’ externalities
(e.g. ear-mark ing)
Conditional
transfer linked
to ‘job done’
Positive action
Actions by ES
providers(heterogeneous)
Well-offPoorUltra-poorEcosystems that generate
important externalities. Requires
SCALE for meaningful impact
PE$Designs and implement
CT/PES within rules,
regulations and institutions
“Ultra-poor”May be best with unconditional
incentives
People Ecosystems Systems and institutionsIntermediaries,
incentives, rules
“Ultra-poor” has higher dependency on quality of ES
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2018
Conditional Social
Transfers tend to:
PES tend to:
• Have a clear social objective
and are able to focus on the
poor and ultra-poor
• Have rural development as a
secondary objective, but often as
an afterthought
• Promote direct, one-off
interventions with short-term
impacts, which may not
change long-term behaviour
• Provide continuous low-level
support that can change social
norms and behaviour over the
long term
• Provide tangible benefits to
the ultra-poor, including
people without land
• Support landowners and land
managers, and so cannot
effectively alleviate extreme
poverty
• Undertake environmental
projects at large scale, but
struggle to do so efficiently.
• Have environmental objectives as
their primary goal
Learning from CT and PES
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2018
Enabling conditions for scaling up
•The ability to make a compelling case for initial (meaningful and sustained) investment and for the use of conditional transfers within a portfolio of economic and regulatory instruments.
Political support
•How projects take the step from one-off, usually donor funded initiatives, to a programme/process with financial sustainability that allows for replication and scaling up.
Sustainable financing
•How programmes are designed to operate in practice, including the ways to coordinate across different government sectors (linking environmental and social departments to ministries of finance).
Lean institutional set up
•How to improve programme effectiveness, such as by using the latest scientific and technological advances to help inform the design, implementation, replication and monitoring of these programmes.
Tools and systems for effective implementation
•How programmes reach people, how they manage ecosystems, how the incentives help reduce poverty or prevent people from falling into poverty, and how conditionality/compliance are implemented.
Ability to demonstrate impact
Source: Based on Porras et al. (2016), from practitioners and policy makers’ experience in cases reviewed in MODULE 2.
What does experience tell in terms of scaling up action?
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2018
Bolsa
Floresta,
Brazil
Costa Rica PSA
WaterShared
(Bolivia, Ecuador, Colombia)
Mexico PSA/
Scolel-Te
South Africa: “Environmental
works programme”
Madagascar
(emerging) PES
The Philippines
Greening the Nation
Bangladesh Jatka
conservation programme
Uganda: Trees for
global benefit
India Mahatma Gandhi Rural
Employment Guaranteed
PRC SLCP/ Eco-compensation
Kenya: Blue carbon/mangroves
Bhutan/ Nepal/
Vietnam emerging PES
ExperiencesDetailed case studies and engagement of ongoing CT/PES
See MODULE 2
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2018
PES in Costa Rica – Module 2
Regulation: Prohibition
to deforest reduces
opportunity cost of
forest\s, but places
protection costs on the
landholder. Local facilitators:
officially registered, they
provide technical and
logistic support to
landowners (e.g.
management plans,
paperwork) and first stop
for monitoring.
Reward: Cash
payment to landowner
Annual conditional
payments per hectare
for forest protection
and reforestation
helps compensate for
costs of protection
Rules on rent capture:
PES Law creates rules
and the system to
extract rents from users
(water users) and
polluters (through fuel
tax), and international
sources.
Ecosystems Fund:
Independently managed,
it collects revenues from
multiple sources and
provides financial
sustainability
National programme
manager: legally
appointed, it manages and
monitors systems
EconomyEcosystem services
as inputs to
production or for final
users
Prohibition
Institutions
and tools
Rewards
Tools and systems for implementation
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2018
PES design as a business proposition
Source: See Module 2 Bolsa Floresta
See next page
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2018
Source: See Module 2 Bolsa Floresta
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Ina Porras and
Nigel Asquith,
2018Sustainable financing
Public
budgets
International finance
Voluntary contributions
Conservation finance
Financing:
Charging users
for ES
Transferring
resources to
ecosystem
managers
Implementation
(technical and
governance)
POLITICAL SUPPORT
Source: See Module 3 SUSTAINABLE FINANCING
Multiple sources,
but Governments
vital for scaling up
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Ina Porras and
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2018
Demand led:
consolidation of
household
applicationsCounty Forestry Bureau
Households
National Development and
Reform Commission (NDRC)
Voluntary
applications to
participate
State Forest
Administration (SFA)
Ministry of
Finance
Funding from central
budget
(US$69 billion between
2002-2012)
Determines
reforestation targets
and allocates provincial
quotas
25 Provincial
governments in 82% of
PRC
Councils
Townships/ local
governments
Responsible for meeting targets,
distributing payments, providing
technical support and monitoring
impact
32 million
households
between 2002
and 2012
Direct ES
beneficiaries
Programme
encourages the
promotion of
local deals with
beneficiaries of
ecosystem
services
China’s
Eco-compensation
/ SLCP
Source: See Module 2 China
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2018
Conflict resolution by talking, raising awareness and
small reward
Downstreamlocal fund:
commitment to local, long-term
financing
Upstream communities
provide and protect water quality and
quantity
Rewards: Selection criteria is a simple mix of
hydrological rules of thumb,
conservation priorities and
downstream requirements,
with light-touch monitoring.
Institutions and tools: • Water utilities
• Municipal
governments
• NGO (Natura)
Conflict: • Solutions reached by
negotiation;
• Rewards are social
recognitions of mutually
beneficial deals;
Development
projects
Upstream-downstream linkages
Source: See Module 2 Watershared, BOLIVIA
Water
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2018
Offset demand
Intermediaries
Smallholder carbon offset chain1. Community
engagement
2. Project idea
note (PIN)
4. Validation and
project registration
6. Periodic third
party verification
7. Over the counter
offset sales or direct deals (e.g. insetting)Offset
resellers
and buyers
Communities and
technical experts
CO2
absorption
CO2 emission
and offset purchase
Local offset supply
Communities and
technical experts
Third party carbon
standard, independent
verifiers and auditors
5. Reporting
and issuance of certificates
3. Project
design
Source: See Module 2 Carbon offsets
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2018
Carbon offsets: energy
and agriculture1. Cows
must be
kept in
specially
built pens at
all times,
where dung
is collected
2. Dung is mixed with water to
achieve required consistency
and enters the digester system
3. The process moves through
a series of interconnected
underground containers
4. The biogas is transferred to
the household for clean, on-
demand energy
5. Bioslurry is used as a
highly valuable natural
fertiliser for agriculture
6. Carbon offsets from
avoided deforestation are
issued to international
markets
Source:
IIED/ HIVOS
Carbon
and agriculture
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2018
Voluntary
carbon
offset
buyers
Farmers Project developers Independent
standards
Buyers
Who
are they?
Heterogeneous. Seek added
value to agriculture. Carbon-generating activities must combine with existing
farming activities. Commitment: long-term to
access project
Absorb risk of price
volatility.Carbon as single activity or part of
portfolio.Must comply with
requirements. Manager and seller.
Standardisation
of carbon as over-the-countercommodity.
Establish criteria to provide
credibility.
Offsets as compliance
or CSR. Heterogeneous and not grouped. Individuals or
companies. Respond to shareholder
and public pressure.
Link to
M&E
Useful feedback on the quality of
their activities but may divert from other activities. Helps understand when they may be at
risk of default and why.
Legitimacy to access
international markets but need to keep transaction costs
down.
Trust that is
reflected in market share.
Trust re. legitimacy of
transaction is reflected
in prices and repeat
purchases.
Ability to demonstrate impact: monitoring
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CO2
CO2
CommunitiesPrivate
sector
CSR
Project
developer
Communities
get paid to
reduce carbon
emissions
SDG1: Reduce poverty through (1) Short-term improvement in food security
and cash payments from PES and (2) long-term investment
in resil ience to climate change
SDG 2: Food
security through promotion of agroforestry systems
SDG 7:
Sustainable
energythrough timber from managed
forests
SDG 13: Reduce climate change
threat through offsetting unavoidable
carbon emissions
SDG 17: Means of
implementation through a
certified ethical carbon market in partnership with local
partners, including governments
SDG 8: Grow th and
employment through creation of
multiple jobs along carbon value chain, especially for youth and
women (monitoring, technical support, nurseries, etc)
SDG 15: Protect local ecosystems and
biodiversity by using native species and
promoting conservation and enhancement of existing habitats
Private
sector
buys
carbon
offsets
Source: Porras 2015
Links to wider agenda: SDGs
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Ina Porras and
Nigel Asquith,
2018Where now?
• Research can help, but needs to reach practitioners
• Many useful tools to:• Improve design, targeting, and monitoring;
• Measure impacts using models and open source data;
• Help understand behavioural heterogeneity and design evidence-based responses;
• Help measure the economic impacts of environmental investments (ERR) at scales
• Need practitioner-friendly tools
• Capacity building and South-South exchanges
• More active engagement academic-research-practitioners
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Ina Porras and
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2018
Useful materialsTopic Description and source
Ecosystem-poverty linkages
• ESPA book on ecosystem services and poverty alleviation (Mace et al., 2018).
• PROFOR (2017) Poverty-Forests Linkages Toolkit. http://bit.ly/2nf751v
PES • FAS (2017) PES guidelines for the Amazon region. PES toolkit: designing innovative schemes for environmental services. http://bit.ly/2DRSt26
• Birdlife International (2017) Toolkit for Ecosystem Service Site-based Assessment (TESSA). http://bit.ly/1XGAF9n
• World Agroforestry Center (Namirembe et al., 2017) Co-investment in ecosystem services: Global lessons from payment and incentive schemes. http://bit.ly/2DBv0Py
• Payments for Watershed Services: The Bellagio conversations (Asquith and Wunder, 2008). http://bit.ly/2DMHKaf
Conservation finance
• Credit Suisse AG and McKinsey Center for Business and Environment (2016). Conservation Finance. From Niche to Mainstream: The Building of an Institutional Asset Class. http://bit.ly/2zngacJ
• UNPEI handbook for planning and budgeting (Forbes et al., 2015). http://bit.ly/2ncwCrV
• BIOFIN (UNDP, 2016) Workbook: Mobilizing Resources for Biodiversity and Sustainable Development. http://bit.ly/2wi6vpU
• UNDP Financing solutions for sustainable development: www.undp.org/content/sdfinance
Quantification and valuation
• ValuES: Methods for integrating ecosystem services into policy, planning, and practice. www.aboutvalues.net/
• OpenNess Project: Integrated assessment and valuation of ecosystem services. Guidelines and experiences (Barton et al., 2017a). www.oppla.eu
• AmbioTek/Kings College London: Policy Support Systems and online models. www.policysupport.org
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Ina Porras and
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2018
This work represents the reflections of a wide range of
practitioners, researchers and policy makers involved in the daily implementation of conditional transfers and payments for ecosystem services programmes. We would like to thank the ESPA
programme for providing the funding to conduct this review, as well as the space to access the very latest scientific advances on
ecosystems and poverty alleviation in developing countries. We would like to especially thank Paul Steele, Bhaskar Vira, Esteve Corbera, Virgilio Viana, Mahesh Poudyal, Kate Schreckenberg and
Julia Jones for their insightful comments and feedback along various stages of this work. We would also like to specially thank
Zaiza Khan and Cinzia Cimmino for their support in editing this document.
All errors and omission remain the responsibility of the authors.
Ina Porras and Nigel Asquith, 2018
For more information and materials visit
www.iied.org/
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Ina Porras and
Nigel Asquith,
2018
Notes by slide2
This guidance focuses on the use of conditional transfers (CTs) – such as PES – in the context of ecosystems and poverty alleviation. CTs are a type of
economic incentive that often w orks alongside regulatory instruments such as standards and prohibitions. Incentive-based policies provide inducements –
monetary and otherw ise – to encourage good behaviour (ie investments in w atershed protection) or discourage bad practices (ie pollution or forest
degradation).
In this module w e discuss some of the main elements of designing CTs for ecosystems and poverty alleviation. Modules 2 and 3 bring in-depth lessons from practical experiences.
How to use this handbook
The handbook is organised into four modules, accompanied by dow nloadable Pow erPoint presentations and links to other dow nloadable materials.
We start w ith the observation that PES is not a stand-alone concept that w as recently developed within the conservation movement. Rather, PES is a form of
conditional transfer (CT) w ith a strong environmental component (Ma et al., 2017; Rodríguez et al., 2011) that in practice of ten operates alongside other policy
instruments (Barton et al., 2017b). We therefore base many of our lessons on the extensive global experiences in conditional transfers for social protection, and
in particular the large- scale public w orks programmes that have already had important environmental impacts (Devereux, 2009; Kakw ani et al., 2005; Koohi-
Kamali, 2010; McCord, 2013; Uraguchi, 2011).We build on previous publications and guides (see Table 2) w ith new research f indings, such as those from ESPA researchers, and add practical know ledge of
practitioners and researchers on key enabling conditions for success, brought together at several recent international w orkshops in Cambridge, UK (Sept 2016),
Kunming-PRC (November 2016) and Chongqing, PRC (December 2017).
4Conditional transfers (CTs) are social benefits used by governments to address w elfare (Devereux, 2009; Fiszbein et al., 2009). They are usually targeted at
individuals economically at risk, chronically poor and/or socially vulnerable. Already in use for many years, they have also been w idely evaluated. A w ealth of
know ledge has been produced on the w ay that conditionality affects outcomes (see for example Abdoulayi et al. (2017) and Rodriguez et al. (2011). CTs are
designed to have short-term impacts on w ellbeing (usually through a direct cash injection), long-term impacts (eg improving the health of people w hen linked to
‘actions’, such as visiting a clinic), and potential multiplier benefits across the economy, such as pushing the demand for better education facilities (Kakw ani et al., 2005)
5Menton, M., Bennet, A., 2018. Payments for Ecosystem Services in Principle: ‘true-PES’ unicorns, ‘PES-like’ umbrellas and the call for locally driven, equitable
approaches to PES, in: Mace, G., Schreckenberg, K., Poudyal, M. (Eds.), Ecosystem Services and Poverty Alleviation: Trade-offs and Governance.
Routhledge, London.
7Definitions are important – not just as “academic quarrel” but to the implementation of the instrument. Wunder (2015) is a very good paper to look at the
evolution of definitions, and w hy are they important. There is an element of vagueness implied in “PES-like” approached. Among other problems, it can lead
diff iculties in monitoring impacts on the ground.
Conditional transfers (CT), such as guaranteed job schemes, pensions and food transfers, have been used for achieving social objectives and raising the living standards of vulnerable people. Conditional transfers are also used to pursue environmental objectives, for example promoting agroforestry or forest protection
w ith incentives such as environmental subsidies and payments for ecosystem services (PES). Both social CTs and PES have the s ame starting point: the
assumption that direct, conditional incentives are the most effective way to change behaviour. Carefully designed, these incentives can contribute to the
w ellbeing of people, especially poor and vulnerable groups.
8Pagiola’s basic f igure provides the logic underlying PES: Under the current policy structures, the value of ecosystem services is not included in private decisions
making conservation economically unattractive.
The private gains of existing management are higher than conservation. But often result in high societal costs (externalities).
PES proposes transfers from the costs/losses from externalities to make conservation more attractive. Engel, S., Pagiola, S., Wunder, S., 2008. Designing
payments for environmental services in theory and practice: an overview of the issues. Ecol. Econ. 65 (4), 663–675. Pagiola, S., Platais, G., 2007. Payments for Environmental Services: From Theory to Practice. World Bank, Washington DC
30
Ina Porras and
Nigel Asquith,
20189The conditionality element is w hat appears to make PES politically attractive. Conditionality offers a simple w ay to link policy (eg payment) to relatively simple
outcomes (eg number of hectares of forest protected, number of jobs created). A w ealth of know ledge has been produced on the w ay that conditionality affects
outcomes (eg MIT Poverty Action Lab, 3ie, and the World Bank Impact Evaluation Group). Conditionality is linked to: The understanding of the causal links
betw een actions, ecosystem services and outcomes, w hich defines the ̀ actions’ promoted; The institutional context that enables ecosystem providers to
comply w ith these actions, w hich includes property rights and collective action, as w ell as access to technical and f inancial resources; and The extent to w hich the programme implementers enforce compliance (Hejnow icz et al., 2014; Porras et al., 2013a; Wells et al., 2017).
10Political support by actively engaging the poverty agenda:
Ultra poor: Ultra poor requires help w ithout conditions attached. People live in extreme poverty w ith very little access to support. Imposing conditions on
payments can make them w orse-off and create further unbalances.
Medium poor; Medium poor” refers often to smallholders w ith limited (but some) access and control to resources. Conditional transfers tend to w ork better for
this group.Better off: Wealthier landow ners are, in theory, better equipped to comply w ith regulation w ithout incentives. In the practice how ever these groups have more
pow er and often appropriate resources available.
The linkages betw een ecosystems and poverty alleviation are neither simple nor linear. Mace et al. (2018) summarise the latest evidence on the nature of these
relations and governance structures that help improve the w ellbeing of vulnerable people. In this handbook, w e ask w hether conditional transfers such as PES can help alleviate poverty, in the context of ecosystem management. Table 3 and Menton and Barret (2018) provide a synthesis on the arguments in favour and
against. Our entry point in this handbook, presented in Figure 2, does not suggest a ̀ one tool f its all’ approach. Rather, it acknow ledges that CTs operate w ithin
a w ider range of policy instruments, w hich can be used to target ecosystems of high importance (eg fragile, or in need of restoration), w hile bringing forward the
issues surrounding heterogeneity of ecosystem service providers. As the Figure show s, the choice of policy instrument to use can be – and should be – linked
to poverty levels. As presented, conditional transfers may w ork better in the `medium-poor’ range, w here incentives can be more competitive and ‘tip the balance’ of costs of engagement. Very poor members of society, or ‘ultra-poor’, may benefit better from unconditional transfers and other measures that
address contextual and institutional gaps. As mentioned before, CTs are favoured by its proponents as a means to provide shor t-term poverty alleviation
through a payment, and long-term benefits by improving their natural assets. These potential benefits could be signif icant, for example new forms of income,
diversif ication, technological transfer, increased land security, capacity building, improved natural conditions, etc. But the poor may also be affected by
signif icant barriers to access the programme, by being unable to satisfy the conditions and indeed to derive meaningful benef its. Constraints for the poor can be high, and can include high transaction costs, unclear property rights, weak bargaining pow er, an unclear regulatory framework, inadequate skills, market
contacts, know ledge, and coordination.
In practice, poverty alleviation can be addressed at least at three fronts: 1) by directly supporting the poor people located at project sites; 2) by making clear the
linkages to poor people w ho benefit from ecosystems, and 3) through this, make the case to access social/rural development budget lines.
11The multiple interactions of ecosystems and people became clear w ith the milestone publications of the Millennium Ecosystem Assessment (MEA, 2005) and
The Economics of Ecosystems and Biodiversity (TEEB, 2011). Subsequent publications stress the importance of nature in providing good quality of life,
supporting people and communities “free from poverty and disease” (Díaz et al., 2015, Fisher et al., 2014), w hile the grow ing emphasis on green grow th and
natural capital unequivocally link nature and ecosystem services to wealth (Cohen et al., 2017).
This convergence of multiple agendas opens a policy w indow to bring traditionally “niche” issues -such as poverty alleviation or w atershed protection – into mainstream economic policy. This means an opportunity for actively designing policy instruments to deliver multiple objectives and bringing in tools and systems
to help manage the inevitable trade-offs that will emerge. This document focuses on the potential of using conditional transfers to support the provision of
ecosystem services and help alleviate poverty for vulnerable groups.
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12Introduce the basic PES framew ork: it’s about people. Through their behaviour they affect ecosystems and generate externalities to production inputs (e.g.
hydroelectricity, water utilities) and consumers. These could be costly (to lose, or replace). PES is a conditional transfer that acknowledges the link (e.g. not just
subsidy) and seeks to change behaviour.
First group: ecosystem managers, they get benefits (goods and services) from managing their land. But their actions can also affect others, either by affecting inputs to production (e.g. hydroelectricity, water utilities, tourism), or f inal consumption (food, clean
air). The benefits, or costs, of these externalities are not usually accounted. This is called externalities. There is little incentive to manage ecosystems in w ays
that improve or maintain the benefits to others, as the costs of doing so falls completely on the ecosystem managers.
The idea behind PES is to “cash in” these externalities, otherw ise unpriced. This is done either through voluntary agreements (direct, such as w ater funds in
South America or indirect such as carbon offset deals). Most often the government acts on behalf of society and redirects funds by earmarking revenues for conservation. For example by increasing prices (e.g. of w ater), relocating budget lines (through fiscal transfers or environmental f iscal reform) or introducing
new taxes (e.g. carbon tax).
These revenues are transferred via an intermediary (or a group of facilitators) w ho manage and implement a programme that ens ures that the resources are
allocated tow ards providing positive actions.
This includes identifying the ecosystems located in the areas that provide these ecosystem services – this is called targeting, as w ell as designing actions that are more likely to be follow ed (in line w ith existing regulations), and ensuring that harmful activities are simply not displaced somew here else (called ‘leakage’),
as w ell as looking at the existing rules and regulations (policymix)
The targeted group receives a compensation, incentive, rew ard or payment, either in cash or in-kind.
This rew ard is conditional on complying w ith pre-agreed activities – or positive actions – that are expected to result in better ecosystem services.
Careful w ith “ultra-poor”. The conditionality needs to be aligned w ith context and capacities of ecosystem managers. Ultra-poor land managers may be w orse off if bounded by conditionality. In these cases PES is not likely to help and may result in making them w orse off.14
14Notes: based on Porras et al. (2016a). An international w orkshop in Cambridge (co-funded by ESPA, September 2016) brought together policy makers,
practitioners and donors to share practical experiences on the enabling conditions for PES. A full list of participants is av ailable in the w orkshop report (Porras
et al., 2017). These conditions w ere discussed in more detail by participants to the 5th International Eco-Compensation Conference in Kunming, PRC,
November 2016.
Successful CT/PES schemes exhibit a series of enabling conditions: high level political support, sustainable f inancing streams, lean institutional set ups, tools
and systems for effective implementation and a clear ability to demonstrate impact. Cross learning from our cases has proved to be an effective way to build
capacity, and to improve CT/PES programmes from the ground up. Capacity building, bringing in scientif ic advances in modelling, monitoring, and
understanding behaviour should include mid-level technical government staff and not only universities. Research into the gaps and potential of including poor
and vulnerable people into environmental policy needs to reach a w ider audience that includes not just Environmental Ministries and conservation professionals, but also mainstreaming into the agendas of Ministries of Finance, Ministries of Employment and the private sector.
New advances from academic research can help understand these trade-offs, as well as design informed policy responses (see for example Mace et al. 2018,
w hich summarises eight years of research on ecosystems and poverty alleviation).
15SEE MODULE 2 FOR DETAILS. We looked at a w ide variety of programmes that:
Managed to go beyond “project” to “programme”
Managed to achieve scale
Are promising examples of incentives tow ards stewardship for good ecosystem management.
We also looked at tw o types of conditional transfers: 1) Conditional transfers supporting direct interventions through job schemes (e.g. gully control) – w hich ARE NOT PES, but provide good examples of how to engage w ith landless, poor/vulnerable people. These programmes also have env ironmental w orks in their
portfolio and can benefit from experiences from PES elsew here. And 2) Conditional transfers supporting positive changes in behaviour, more in line w ith PES
idea. Some are national programmes (scaled up) or replication of local-based initiatives (scale out).
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16Tools: CR provides a good example of an integrated approach to PES: Financial sustainability – by providing the revenues from fuel tax, even if the pledged
amount has changed throughout the years. Also, by allow ing the managing institutions to capture payments from direct users (make international sales, deals
w ith local users, etc); Creation of the legal framew ork that recognises the principle; Institutional framew ork to administer the programme, allow s for the f inancial
and technical groups to w ork together. The managing institution, FONAFIFO, is a public organisation managed as a private one,w hich gives enough flexibility to
w ork. Political support from the highest to the low est levels – the Programme has “survived” several changes in administration and political parties. Participation of civil society has been key at all stages, and provides important feedback to the programme. Transparency and credibility frommonitoring, administration, forest
regents, audits, GIS, etc. .
17 and
18
Tools: Business case using a business canvas in Bolsa Floresta, Brazil. The design of the BFP follow s a business approach, based around the business canvas
model – see Figure . Some of the main components are presented in the next section, but for more information see FAS (2017).
Law s and regulations. This programme is part of the state public policy, instituted by the Government of Amazonas in 2007. The main law s underpinning the
programme are Law 3135 on Climate Change, Environmental Conservation and Sustainable Development of Amazonas, and Supplementary Law 53 concerning
the State System for Protected Areas (SEUC). The law s determine environmental legislation at the State level, and paved the way for forest-based environmental services linked to social justice and equality.
Targeting and prioritisation. The prioritisation of areas in the Bolsa Floresta Program have the follow ing reference attributes:
identif ication of relevant areas, focusing on Sustainable Use Protected Area (PA) as w ell as the presence of potential providers, i.e. forest guardians and riverine
communities, for environmental services in the area;
Identif ication of critical areas by looking at risk of reduction in provision, taking into account existing provision of ecosystem services, level of coverage by command and control structures, external pressure on the PAs w ith impacts on ecosystem conservation and occurrence of unsustainable activities in the territory.
Identif ication of potential areas by understanding needs of potential providers, including social vulnerability and access topublic services; level of social
organization, w illingness to conserve;
Priority areas for PES schemes also taking into account cost versus conservation impact (resident populations versus area of the PAs).
These attributes are rated numerically (e.g. 3=high, 2=medium, 1=low ; Yes=1, No=0) and added to identify the areas w ith higher potential. FAS (2017) provides in-depth details on implementing these targeting strategies.
Type of transfers: The structure of BFP begun w ith three components considered basic for quality of income (Figure 12): community infrastructure, cash reward,
and community empow erment. After 2008, following a series of w orkshops and consultations, the program w as re-organized, with additional components aimed
at promoting sustainable income, supporting grassroots organisations and social investments (education, transportation, health, and communication). These
additional components are funded by the project, not as (government) public services. The relative w eight of the of the incentive package w as re-arranged, with more emphasis on cash rew ard, in response to the community feedback. The consultation process also determined the stronger focus on w omen as main
recipients of the cash and proposed equal level of investments across different communities.
Figure 12. Payment modalities in Bolsa Floresta
FAS management strategies. Several factors appear also help improve programme effectiveness:
The development and use of cost indicators (e.g. % overall implementation costs; number of days before purchasing air ticketscontrolled per individual staff) presented and discussed at length on quarterly FAS staff and board meetings lead to creation of an institutional culture of cost reduction.
The use of indicators of key outcomes (e.g. gender - % of w omen participation, % projects fully implemented), presented and discussed at monthly (up to 2013)
or quarterly (2014 onw ards) internal management meetings at FAS helped identify problems and develop solutions for improved eff icacy. Partnerships with other
organizations (e.g. state and municipal governments, NGOs, grassroots organizations) helped reducing costs of f ield journeys,demand of staff and improved
outcomes. When possible, bulk purchase equipment and goods by FAS administration, w hich increases the bargaining pow er with suppliers and helps reduce costs. ICT systems for inclusion. The Family (cash) component is paid through a Bradesco Bank debit card, directly to the account of individual families. This
benefit is paid every month and accumulates in the beneficiary’s account until collected w hen the family goes to tow n or to aremote Bradesco express ATM
machine. All families visit the city at least tw o or three times per year, w hen they visit relatives, for education, medical purposes etc. The link to bank account
reduces paperwork and the chances of mismanagement of resources, while promoting f inancial inclusion by encouraging the creation of bank accounts for the
families in these remote locations. Programme’s theory of change, based on four points: 1) Intermediate results that should be achieved by the providers in termsof changes in practices, 2) direct
results anticipated from rew ards foreseen in the scheme; 3) complementary actions to be realized by the leader of the scheme or partners; and 4) complementary
actions outside the governability of the scheme. FAS (2017) provides clear details on the specif ic components of this theory of change.
Clear gender equity agenda, that includes objectives, resources, indicators and monitoring. The programme has defined clear strategies for action, w hich include:
1) control of cash resources by women; 2) incentive for participation of w omen in participative planning w orkshops, leadership meetings and other processes of participatory management; 3) incentivize leadership of w omen in projects that generate income and enterprise; 4) educational actions on the rights of w omen;
and 5) support for the creation and strengthening of clubs and associations of w omen;
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17and
18
Ensuring transparency and feedback. Transparency is a key element of the implementation strategy of FAS. The governance of the BFP includes a leadership
meeting, w hich includes 40 to 70 presidents and other leaders of grass root organizations that represent the over 40 thousandbeneficiaries of different areas.
These are umbrella organizations (“associaçao mãe”), which are formally established and represent small community level associations, mostly informal. These
meetings take place tw ice a year, usually in Manaus (in 2012 took place in Rio de Janeiro, at Rio+20 meeting) and last f ive days. These leadership meetings
provide a unique space for open evaluation and discussion of the BFP, w ith a focus on challenges and solutions. These meetings also provide a unique space for the leaders to engage in direct debate w ith high ranking governmental off icials, thus empow ering them to claim their rights. Finally, the leadership meetings
provide an opportunity for sharing lessons and for developing new leaders. Since 2016, the leadership meetings are also receiving 10 to 20% of youth
participants.
Once a year the results of the BFP are discussed in seminars held at local universities (UFAM, UEA) or at FAS. These public seminars provide a space for multi-
stakeholder interaction, especially w ith academia and NGOs, focusing on sharing know ledge and reduce partisan criticism of the BFP. Complete f inancial statements of FAS and the BFP are published in full in the w eb and registered in a public notary. This disclosure is precededby an annual independent audit by
Pw C, w hich is reviewed and approved by the Fiscal Board and the Board of Administration of FAS. A detailed activities report (+100 pages) is published yearly
and also posted in the w eb for open access.
19Governments in India, China and South Africa pledge signif icant budget allocations to CT/PES. Costa Rica and Mexico show thatit is possible to earmark w ater
and fuel taxes for environmental activities. Local schemes such as Watershared in South America demonstrate a w illingness from local governments and w ater
utilities to pay tow ards watershed conservation.
Climate change and SDG agendas bring the environment back onto the discussion table, as w ell as the potential to scale up f inancial f low s towards conservation
and restoration of ecosystems. This section focuses on how PES/CT programmes are f inanced and presents strategies to secure sustainable f inancing to scale up and achieve long-term
impacts of the programmes. It is based on lessons from ongoing programmes review ed in Module 2 and emerging systems from international climate and
conservation f inance.
We identify three main types of funding for CT/PES (Figure 4): a) direct deals and voluntary contributions, especially for carbon and w atershed local deals; b)
public budgets, through ear-marking, general budget or public debt; and d) international f inance, for example linked to REDD+ and climate change resources. An incipient sector is linked to d) conservation f inance, which focuses on the potential of initiatives to generate f inancialreturns to investments. Political support
and viability underscores any strategy for sustainable f inancing.
20Implementation: China: : http://pubs.iied.org/search/?k=G04270. The People’s Republic of China (PRC) has been experimenting for many years now on eco-
compensations programmes, as w ays to redress missing market signals for ecosystem services (Zhang et al., 2009). This section provides a quick insight into
one of its larger programmes: the Sloping Land Conversion Programme. The Sloping Land Conversion Program (SLCP, also know n as “Grain for Green”) is the
largest ecological restoration project in PRC and PES initiative in the developing w orld, with a total current investment of more than US$69 billion (Liu and Lan,
2015). It w as launched together w ith the Natural Forest Protection Program (NFPP) as a response to the w idespread f lood in the PRC in 1998 and has undergone several development stages. It is a key component of the Eco-Compensation Programme, w hich is a compendium of environmental policies and
instruments, including environmental f iscal reform. The programme uses a series of conditional transfers alongside w ider policies promoting off-farm income to
encourage ecological restoration and contribute tow ards PRC’s vision of EcoCivilization.
Several useful lessons can be draw n from the SLCP experience, all pointing to the crucial, inextricable link betw een the institutions, incentives, and ultimate
success of a programme. Decentralisation under the SLCP focused disproportionately more on distributing responsibilities thanon fostering a local sense of ow nership, causing the programme to expand too fast in its Phase I and f irst half of Phase II (1999-2005) at the cost of its budgetary burden, its democratic
character and effective targeting. Recognising the trade-offs inherent between scale and targeting, the critical importance of the latter should not be understated,
as revealed by its connection w ith the SLCP’s unintended, negative impacts on the environment (ie w ater shortages, decreased biodiversity) and local livelihoods
(ie low er incomes, higher inequality, disempow ering of nonparticipants). Therefore, implementation, including compensation, should be sensitive to local
heterogeneity and be guided by a management strategy that is f lexible, inclusive and responsive to feedback (Yin et al., 2014a). Beyond implementation, scaling up a program of such magnitude requires a strong focus on the initial phases of planning, demonstration and piloting, as w ellas on strong safeguards that w ill
maintain the programme’s incentive structures long after its implementation and thus guarantee its long-term success (Yin et al., 2014b; Chen et al., 2015).
Fortunately, some of the lessons learned from the previous phases of the Programme have been used to re-shape the Programme. For example, in its latest
Phase IV, the Programme is targeting only those w ho are poor, w illing to convert and w hose crop lands are in a steep slope (25o in one circumstance, and 15-25o in another). Adaptive management is vital for the Programme’s success, yet absence of independent monitoring and evaluation might undermine its adaptive capacity in the long run.
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21Implementation: Watershared: The principles of a Watershared agreement (follow ing the RED/AMBER/GREEN format:
Red: Conflict resolution by negotiation, not prohibitions or regulation;
Amber: Financially sustainable system w ith long-term dow nstream contributions, supported by NGO/donor contributions;
Green: Positive rew ards that act as social recognitions of the mutual benefits of upstream protection. The activities and target areas follow simple, clear
guidelines to understand hydrological linkages. The Water Fund w orks like this: The development NGO, the Municipal Government and the Water Cooperative each invest in--and play a decision-making role
in--the Water Fund. The three-institution board decides annually how money w ill be spent: in annual payments, in-kind support, land purchases, or w hatever
else. These compensation payments are paid to upstream landow ners, who in turn sign contracts to guarantee land use, and (supposedly) provision of the w ater
service.
22Implementation. Transprarency in long value chains for carbon. Any growing tree can f ix and reduce carbon emissions. But it takes a series of extra steps to
make this action into a commodity that can be traded in carbon markets. Figure 1 show s how a typical Plan Vivo carbon offset project operates. A project
developer w orks with smallholders, communities and supporting agencies to develop a project idea note (PIN). This is submitted to Plan Vivo w here it is initially
checked against the eligibility criteria set out by the Plan Vivo Standard. Amongst other key aspects, the Plan Vivo Standardhas a particular focus on w hether
the project secures land tenure or carbon rights for participating communities and uses native or naturalised species in its project activities. If it fulf ils the eligibility criteria, the carbon accounting methodology goes into the Project Design stage. After submission, the carbon accounting methodology is evaluated through a
peer-review process and assessed by Plan Vivo’s technical committee. Successful projects go through validation and project registration. Through the
submission of annual reports, projects can demonstrate compliance w ith their project design and monitoring targets, w hich will lead to the issuing of valid carbon
certif icates. The project developer is then able to sell these certif icates in voluntary carbon markets. Regular third-party evaluation takes place to ensure the
validity and permanence of carbon sequestration rates and that the proper dispersal of funds to communities in an equitable benefit sharing that is fair and transparent.
23Implementation. Carbon and smallholder agriculture value chains. This example show s how carbon offsets can be brought alongside initiaties that support
BIOGAS for smallholder agriculture. Payments for Ecosystem Services in smallholder agriculture: lessons from the Hivos-IIED Learning Trajectory.
http://pubs.iied.org/16598IIED/
This synthesis report presents highlights from six projects w hich are part of the joint Hivos-IIED PES Learning Trajectory Programme in f ive countries –
Guatemala, Indonesia, Kenya, Nicaragua and Peru – that are exploring the use of carbon projects in smallholder farming. Through this research IIED and Hivosexplore the feasibility of payments for ecosystem services (PES) as incentives to promote a shift to sustainable smallholder agriculture. Results from this
research are published in the Payments for Ecosystem Services in Smallholder Agriculture series. We focus on practical learning from existing smallholder and
community PES projects linked to energy and agroforestry activities. Working with local partners and project practitioners, we analyse the opportunities,
challenges, strategies and potential ‘no-go’ areas in a pre-selected group of smallholder projects and analyse them w ithin the global context of w ider learning on
w hat works and w hat does not in PES. Based directly on lessons drawn from our partner studies, w e adapt the LINK methodology tools developed by the International Center for Tropical Agriculture (CIAT), to understand if and how PES and carbon approaches can help smallholders successfully enter and benefit
from existing markets.
24Figure 2. Monitoring along the value chain. Monitoring and evaluation (M&E) becomes the tool by w hich projects prove the existence of the carbon offset and its
co-benefits. International certif ication bodies such as the Plan Vivo Foundation or the Gold Standard act as independent agents that ensure transparency and
credibility of these transactions. Monitoring is important along the chain for several reasons (see also Figure 2):
For farmers, it checks compliance of agreed activities, and provides useful feedback to them on the quality of their activities – for example, how well their trees
are grow ing or if any remedial actions are necessary if operational issues arise.For project managers, it helps align incentives to performance and triggers payments.
For transferring technology, capacity and feedback related to the activities promoted from project developers to farmers, creating a w ider community of practice
and sharing lessons and strategies w ith other smallholder and community projects.
For validating assumptions for model development.
For supporting transparency and credibility for buyers to foster sales. Community monitoring plays an important role in REDD+ projects in monitoring carbon stocks (Larrazábal et al., 2012). For example, communities can provide a
large w orkforce to facilitate collection of large amounts of data at large scales; they can bring their local skills and knowledge to complement expertise (Berkes et
al., 2000), and they can provide ecological data w here there are gaps in academic studies (Dosw ald et al., 2010). The cost of hiring local labour is, for the most
part, relatively cheap (see Box 2). There are, how ever, some risks. For example, training is required to ensure that protocols and procedures approved by IPCC
are met (see glossary). Supervision is required (especially in early stages) and procedures to ensure the reliability of datacollected must be adhered to. Larrazábalet al. (2012) also point out that local people might be tempted to exaggerate the carbon stock increases if this is linked to payments received.
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25Figure 3. Smallholder carbon offsetting and the SDGs
Source: Porras, I., 2015. The Plan proposal tow ards the Sustainable Development Goals. Plan Vivo Foundation, Edinburgh.
The Sustainable Development Goals (SDGs) are a new , universal set of targets and indicators. UN member states are expected to incorporate them into
their agendas and political policies over the next 15 years. They include a commitment to end poverty and hunger, improve health and education, make cities more sustainable, combat climate change and protect oceans and forests. The investment required w ill run into trillions of US dollars. This w ill mean
forming partnerships across the w hole spectrum of society: government, the private sector, international and local NGOs, and communities.
The mutually beneficial, ethical partnerships promoted by Plan Vivo are w ell placed to support the implementation of at least seven of the SDGs (Porras
2015b), as show n in Figure 3 and outlined below .
SDG1: End poverty. Partnerships can cut through many of the roots of poverty in several w ays. Direct cash transfers estimated in proportion to the amount of carbon absorbed in the plot provide short-term poverty alleviation. Projects build human and natural capital w ithin communities, helping eliminate long-
term poverty. And Plan Vivo operates in many places ignored by others. For instance, it w orks in remote locations/farms and in areas divided by conflict. In
these situations, the projects provide much-needed technical support in the design of the individual farm-management plans. The farmers ow n the trees
planted and are able to use and/or sell the timber in both the medium and long term depending on the species used. Some projects help communities
establish small-scale timber w orkshops, and local people are learning how to produce furniture or crafts. SDG2: Achieve food security. During the initial stages of a project, farmers and project developers hold regular meetings. Their objective is to design a
management plan that w ill ensure the long-term survival of tree species without compromising family food security. Plan Vivo promotes a mixed portfolio of
activities to spread risk. For example, different types of tree species are appropriate for timber, fruit, fodder and shade f or intercropping, considering w hat
w orks best with the agricultural crops the farmers have available. Activities like beekeeping produce honey for household consumption or sales income
w hile encouraging natural pollination. F igure 3. Smallholder carbon offsetting and the SDGs
Source: Porras (2015a).
SDG7: Affordable and sustainable energy. A signif icant amount of timber is generated by removing branches to encourage tree grow th and through the
thinning process – w hen younger trees are removed to provide space for others to mature. Many projects, like Scolel Té in Mexico, also promote the
adoption of eff icient cookstoves. These are excluded from the carbon account but f inanced through the support of committed of fset buyers either as donations or through agreements to increase the price per offset.
SDG8: Grow th and employment. The introduction of carbon markets has created a major new supply chain. At the local level, this includes project
developers w ho carefully orchestrate the participation of smallholders and remote farmers. They provide cash payments and technical support, and sell
carbon offsets to international buyers. Community monitoring creates jobs for forest technicians, many of them w omen, as w ell as young people eager to
learn new technological skills. Demand for tree cultivation also promotes seed collection and the creation of local nurseries . All Plan Vivo projects are independently verif ied, and most of the voluntary carbon offset marketing is carried out through a grow ing network of retailers in the USA and Europe.
SDG13: Urgent action to combat climate change. Reforestation, protection and management of forests help diminish the threat of climate change.
Collaborations w ith the research and academic sectors, such as the ESPA project w ith IIED and Edinburgh University, have a role to play here. For
instance, they help develop rigorous and streamlined scientif ic methodologies employed to measure the environmental footprint of these activities in cost-
effective ways. Once verif ied and validated, these reduced emissions become a tradable commodity sold in voluntary carbon markets. Companies and governments are then more confident in purchasing these offsets and can use them to meet emissions reduction targets.
SDG15: Protect biodiversity and ecosystems. The sustainable principles underpinning each management plan seek to balance food and timber cultivation
w hile broadening the area of impact to other ecosystem services. Better farm management contributes to improved w ater retention and reduces
sedimentation. Planting new trees, especially native species, helps rehabilitate degraded landscapes. The Yaeda Valley REDD+ project in Northern
Tanzania is an example of a project w orking w ith hunter-gatherer communities to reduce pressure on existing forests while improving livelihoods. Projects like the Nakau Programme in the Pacif ic Islands put forward a ‘habitat protection’ unit that promotes rainforest and mangrove protection to reduce
indigenous community vulnerability to climate risks. This link to biodiversity conservation is also a key proposition for community forest management in
Indonesia. It is currently piloted by Flora & Fauna International and show s great potential for being scaled up across the rest of the country.
SDG17: Partnerships for implementation. The increasing number of projects promoting reforestation, organic agriculture and cleaner energy technologies
requires multiple partners along the value chain. These include farmers, technical and capacity-building specialists, project managers, off ice administrators, carbon experts (modelling specialists, auditors and certifying agents), offset resellers, and importantly, offset buyers. Project developers are increasingly
becoming leading f igures in the design of national public initiatives, such as Ecotrust in Uganda and Fundación Ambio in Mexico.