Valuing the Services of Our Ecosystems

Photo: Paul Hanley

Stories about ecological restoration are the best. Tales of beaver reintroductions transforming landscapes and improving water quality, dams being de-commissioned to allow Salmon to swim free or urban streams being returned to their natural state are the types of stories that inspire me to study science.

Although these success stories are great, they only exist because we have degraded almost every part of our world in the first place. Why do we keep making the same mistakes over and over?


Valuing Natural Capital

One answer is that is because our global economic system doesn’t value natural capital, our environment, our soil, air, water and vegetation, in the way it ought to.

This has a two-fold effect; firstly, it means that the real costs, the impact of economic output, is not accounted for – In economic terms these are referred to as externalities. Think of habitat loss when a highway is duplicated, decreased water quality downstream when a forest is logged, seafloors being decimated by trawling and shipping channels. The common resources we share are being degraded because the negative externalities created by our economy are not being accounted for.

Secondly, the beneficial services that our natural capital provides are not often valued. They are often appreciated, but truly valued, no. We might appreciate a shady tree lined street in the city, but do we know the value of its shade for surrounding buildings, its cooling for the pedestrians bellow or its value for the biodiversity using it as habitat?

We are starting to.

Quantifying the value of ecosystem services is a booming multidisciplinary field of science. As nature is intertwined with every aspect of our lives it makes sense that ecologists or plant physiologists collaborate with psychologists, or engineers, economists and policy makers to measure and value how our natural capital sustains and fulfils our lives and economies.

The ecosystem services of the ocean are being increasingly recognised and valued, particularly the value of “blue carbon”. Photo: Paul Hanley

In 2011, the total value of global ecosystem services was estimated to be USD 125 TRILLION per year. This figure retrospectively keeps going up as scientists improve methods to quantify value, yet the value of the world’s ecosystem services is decreasing each year as we degrade ecosystems around the world further.

This begs the question, what is the point of quantifying the value of natural systems when they are still being degraded?

Although it can all feel futile, there are many stories of the positive environmental impact that are emerging from improved methods of quantifying ecosystem services giving value to natural capital. For instance, wetlands.

Wetlands buffer the effects of hurricanes by absorbing the physical force of storm surges and by reducing flooding. Natural wetlands are much more cost-effective than constructed vertical levees. While, recent research found that wetlands reduced damages to the US state of Maryland from Hurricane Sandy by 30% and overall reduction in damages of over $625 million.

Coastal Wetlands and Flood Damage Reduction from TNC Coastal Resilience on Vimeo.

This is research is valuable for the insurance industry who look for ways to reduce risk. If investment in wetland conservation and restoration reduces the damage to properties after natural disturbances then it reduces the amount of money that they need to pay out. This has given rise to new financial tools, such as resilience bonds, that incentivise investments into ways to reduce risk – and due to continuing research using natural capital is fast becoming the most logical way.

Infrastructure protection is one just one tool for measuring and creating value from the ecosystem services that marine and coastal ecosystems produce. Another is “blue carbon” which is the term for new research showing just how efficient vegetated coastal ecosystems like kelp forests, mangroves and seagrass are in sequestering carbon.

The Barwon River at Barwon Heads, hosting some of Australia’s southern most mangroves, provides countless ecosystem services. Photo: Paul Hanley

Carbon sequestration has long been the driver of creating payments for ecosystem services, as governments around the world have introduced emissions trading schemes that create incentives for reducing green house gases in the atmosphere. Reforestation schemes have worked to varying degrees of success, but the reimbursement is often not great enough to convince people not to use their land for growing crops.

In Australia, where we have lagged behind the rest of the world in pricing green house gas (GHG) emissions, we have one good new story. Reinstatement of traditional Aboriginal fire management in Ahrnem Land, where savannahs are burned in patches early in the dry season, has reduced emissions by almost 40%. GHG reduction is just one of the many ecosystem services that this renewed management practice creates.

Smaller scale fires means more habitat complexity and biodiversity and a return to traditional land management practices almost 50,000 years old.


While there are significant environmental challenges for the world, it is nice to focus on the success stories every once in a while.


2 Responses to “Valuing the Services of Our Ecosystems”

  1. Jamie Liew says:

    Hi Paul, what an insightful piece. (Great photography skills, too!) I think it can be a challenge to integrate economic/financial information into a science-focused article and keep people interested, but you’ve done that wonderfully here. I’m glad you’ve decided to include it especially in an issue as urgent and complex as ecological sustainability. (Is that a term? I might have made it up. But you get the gist!)

  2. Sam Girvan says:

    This is great science communication, giving a value to ecosystems services is crucial as it gives us a tool to explain their value in a way everyone can understand. Great piece.