Valuation of Forest Ecosystem services as Green Economy

Economic valuation of ecosystem services has strong potential to clear the haziness of impacts of decisions undertaken for management of ecosystem services across time and space. Invariably, the response policies designed and implemented to manage ecosystems like forests, wetlands, marine and coasts entail conflict of interests amongst stakeholders in society. Conserving and regulating water, preserving soil, supporting forest management and biodiversity conservation, providing fodder and forage resources for pastoral development, maintaining good environmental conditions for agriculture development, and producing timber and non-timber forest products, and promoting adventure and nature-based tourism are some of the most prominent ecosystems services in the HKH region. Scientists put the annual ecosystem service value of the ecosystems of Himalayas at US$ 150–170 billion. Capturing benefits and costs of those management options in terms of impacts on ecosystem services brings the elements of objectivity and credibility in the entire management strategy. The Himalayan ecosystems are unique with critical role in protecting the environment and providing livelihoods for a larger part of Indian Himalayan Region (IHR) and even to the rest of the Asia.

Most of the times, the economic valuation of ecosystems and biodiversity is done in the context of project or for specific arrangement like payment for ecosystems and cost effectiveness of adaptation to climate change. Economic valuation can also play a greater role for evaluating scenarios analysis (costs of action vs. costs of inaction) and estimating the impacts of policy reforms in different sectors (for example, investment needed for a green economy). Typically, the need for such analysis is far greater in growing and transition economies where sectoral reforms are inevitable challenges for the managers of the economies.

Western Himalaya Mountains have high biological and agricultural diversity including food, fibre, and medicinal plants. The region is rich in medicinal and aromatic plants and different types of mushrooms, precious fibres such as Kashmere wool, and mountain-specific crops such as amaranths, apple, Malta oranges and different types of millets that are in great demand in downstream and global markets. Ophiocordyceps sinensis locally known as “yarsha gamboo” is a highly medicinal value fungus, found growing on the insect caterpillar of Hepialus armoricanus in higher hills of western Himalaya. This fungus has high medicinal value and is used in traditional remedies for various physiological disorders. Being a hormone stimulator Ophiocordyceps is an important anti-aging medicine. Frequent use of this fungus may prevent senile disorder. It is found beneficial in the case of climatic age illness, important, emission, neurasthenia, rheumatoid, arthritis, cirrhosis, flabby waist and knee. Ophiocordyceps has been in traditional use for various diseases like chronic bronchitis, insomnian hypertension, pneumonia, tuberculosis, anemia, night sweat and cough. The cost of natural specimen of national market is more than 3 lakh /kg and in International market more than 5 lakh/kg.  Different types of timbers, fuel wood, forage, and non-timber forest products are widely sourced from these mountains to support downstream economies. The vast and diverse amount of gene pool, especially wild relatives of important crops found in the HKH mountains are the important resource for future and growing population.

Forests are the major sources of timber, fuel wood, fodder, and food for the native people of the Himalayan region. Here, dependency of human population on the forest biomass for running their livelihood is tremendously high and it is a century old practice. Sustainable forest management (SFM) integrates economic, social and environmental values and involves multiple stakeholders, industries, local communities and governments, in planning and decision making. Sustainable forest management must meet societal concerns and tackle conservation and land use issues, providing for multifunctional landscapes and looking to eco-regions rather than boundaries as the unit of analysis and management (reference).

Sustainable forest management represents a new look at forests and forest management to meet two major commitments:

1. Protect and restore the forest ecosystem-improve biological diversity, enhance water supplies, make possible carbon sequestration, meet recreation needs and provide for the forest dependent communities through improved non-wood forest produce;

2. Encourage profitable enterprises, attracting the investor who sees sustainability as a viable economic venture.

Forestry needs to be protected through REDD+ regime and thereby ensure their contribution to a green economy. Credible forest documentation can unite stakeholders in a quest for a comprehensive green economy. It can address fair trade, the need to balance the social, cultural, economic and environmental governance of development, and environmental concerns for the natural resources and carbon-rich forests of the western Himalaya. Appropriately evolved forest certification can be used as a tool in REDD+-related strategies and CDM to address climate change and to benefit local forest stewards. Dynamically adapted forest certification systems can backstop efforts to erode persistent poverty, which are both a cause and a consequence of deforestation and forest degradation. The western Himalayan biomass resource is larger than currently used and several commonwealth industries would benefit from closer outlet for wood residue disposal.

The Van Panchayat (VP: Village Forest Councils) is the oldest community forestry institution in the Indian State of Uttarakhand. Their conservation efforts contribute in providing a number of ecosystem services including carbon sequestration, which has acquired a significant value in the context of climate change. There is a potential for rewarding VPs through carbon payment mechanisms in Uttarakhand. In India there is a distinct possibility to do so under the Green India Mission of the National Action Plan on Climate Change that can augment the green economy.

As pointed earlier the Indian Himalayan forests sequester nearly 65 million t C per year, equal to 15 - 20% CO₂ emissions from fossil fuels combustion from India around the year 2000. Obviously, the Himalayan region contributes substantially to a balanced carbon budget as a whole at the country level.

Hydropower Development: A foundation of green economy

In western Himalaya, there is considerable potential for hydropower to contribute to the emergence of a green economy, as it offers much-needed low-carbon electricity for development. Apart from its problematic promotion as carbon offsetting projects, hydropower can contribute to the avoidance of green house gases (GHG) emissions and is expected to play an important role in the transition to renewable energy systems:  Hydropower continues to be the most important and economic source of commercial renewable energy worldwide and its popularity is increasing. However there remain significant challenges to ensure that hydropower can deliver sustainable developmental benefits locally, regionally, and globally, and meet the expectations of all stakeholders. If well managed, hydropower provides many solutions for energy and water management in a green economy. With regard to climate change mitigation, hydropower as a clean, renewable energy source contributes directly to global low carbon energy goals, and therefore to climate change mitigation.

Hydropower is an important energy strategy that now reshapes the ecological functions and services of a river system.  Hydropower is a renewable, clean and non-polluting energy resource with high conversion efficiency showing spectacular operational flexibility and operational & economic superiority over other power generation means. To encourage hydropower development as well as looking for a tool for local development in peripheral regions, the Indian Prime Minister launched in 2003 in a landmark move the so called ‘50,000 MW hydro initiative’. Under this scheme preliminary feasibility reports for 162 large and medium sized projects with a capacity of 47.9 GW were prepared. Out of these 162 schemes, 133 are in the IHR. This hydropower push has focused on the Indian Himalayas where the steep drops of tributaries to the Indus and Ganga have the potential to generate larger outputs of power in western Himalaya.

The third World Water Assessment Program of United Nation -WWAP-2009 estimates that the world’s population is growing by some 80 million people per year: this fast pace of demographic growth will lead to an increase in freshwater demand of about 64 billion cubic meters per year. The WWAP estimates that by the year 2050, 22% of the world’s population will be older than 60 years and that by the year 2030, 60% of the world’s population will be living in urban areas. This urbanization is expected for 95% of the cases in countries with developing economies.

Hydropower offers a number of benefits by enabling current and future adaptation to the effects of climate change. A reservoir, as part of hydropower infrastructure, has the advantage of offering multiple services. As well as offering clean, renewable energy, a hydropower reservoir can enhance water security and management, providing flood mitigation, storage for irrigation and other purposes, and the stabilization of downstream flow regimes. Other facilities a hydropower reservoir offers include tourism and recreational facilities, habitats for biodiversity, and increases in income generation options for example through fisheries.

 Hydropower: A step towards carbon sequestration 

The Kyoto Protocol’s Clean Development Mechanism (CDM) allows industrialized countries to partially meet their Kyoto Protocol commitments by reducing emissions in developing countries and using the resulting emissions reduction credits towards their Kyoto targets. The CDM plays a pivotal role in the international climate change regime helping emitters in industrialized countries lower their costs of compliance and providing funds for renewable energy, energy efficiency and other emissions reducing activities in developing countries. Hydropower projects can have negative and sometimes severe impacts on river ecosystems and communities, including displacement of communities, loss of agricultural land, and decline in biodiversity. The World Commission on Dams (WCD), established in 1998 in response to growing public scrutiny of large dams, developed a comprehensive framework for energy and water planning to ensure that adverse impacts from dam projects are minimized and the benefits and costs are more evenly distributed among stakeholders.

Figure: Green Gas Emission from different energy resources (Source: World Nuclear Association)

India is also expanding its power sector very quickly to meet soaring power demand and chronic power shortfalls. It anticipates quadrupling its electricity supply between 2005 and 2030, a tremendous undertaking. It intends to do so through pursuing all fuel options. India’s Eleventh Five Year Plan called for 16.5 GW of hydropower to be built between 2007 and 2012. The Central Electricity Authority recommends that 30 GW be pursued during the twelfth five year plan between 2012 and 2017.The project activity is a renewable energy power projects utilizing water resources for power generation.  The electricity generated would be substitute the power generation by thermal power plants and would continue towards the reduction in use of finite and non-renewable natural resources like coal etc. The hydropower project activity by generating clean power would be excellent environment benefit in term of reduction of GHG emission and conservation of natural resources of western Himalaya. 

As energy utilization is the major source of anthropogenic greenhouse gas emissions and associated global warming, renewable, carbon-neutral electricity is currently of much interest. Yet other than hydroelectricity, renewable energy has not been a significant contributor to most modern economies, and societal impacts of sustainable energy use are not completely understood. Significantly different impacts also accrue from different renewable sources such as solar, wind and biomass.

The Indian government has mapped out its hydropower resources by river basin, ranking the attractiveness of potential hydropower sites. This ranking contributes to the decision of which plants will be built in what order. When hydropower sites are mapped out and ranked for future development, the most influence the CDM might have on planning decisions is to accelerate the pace at which some hydropower facilities are being built, not whether they are built at all, perhaps justifying only a few years of credits for some projects if the acceleration effect is discernible. A large number of big hydropower plants (and a number of smaller ones) are aiming to get carbon credits. From western Himalaya, many projects have been submitted to the UNFCCC or have been approved by India's Designated National Agency. Many of the proposed projects are also planning to get CDM carbon credits.

 

The Green Economy: A Worth for Sustainable Development in Himalaya

The green economy (GE) is a new concept that needs implementation at regional and community level in the Himalayan region for sustainable development and environmental governance. Each country recognized the value and potential of GE, interpreting it as leading to “increased human well being and social equity with reduced environmental risks and ecological degradation”. To put the strategies into action, it would require increased investment by national and global agencies in creating green jobs through green infrastructure projects. Institutional reforms and enabling policies, supported by regional cooperation and knowledge sharing are also needed to create incentives for integrated agriculture and natural resource management and to promote enterprise development. Green economy in the region has to be developed on a strong natural resource base - water, biodiversity, forests, and clean energy sources. These resources need to be managed as public goods using principles of good governance and equity, and involving local communities in accounting for the full value of ecosystem goods and services. Economy is of importance for all and sundry but the growing environmental destruction and disparity between the rich and poor demands adoption of cleaner and better path so as to secure the future resources and achieve sustainable development with better social inclusion. In this regard, the term ‘green economy’ came into light.

UNEP defines a green economy as one that results in “improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities”. In its simplest expression, a green economy is low-carbon, resource efficient, and socially inclusive. In a green economy, growth in income and employment are driven by public and private investments that reduce carbon emissions and pollution, enhance energy and resource efficiency, and prevent the loss of biodiversity and ecosystem services a green economy as based on six main sectors

• ·         Renewable energy
• ·         Green buildings
• ·         Sustainable transport
• ·         Water management
• ·         Waste management
• ·         Land management

Mountain ecosystems provide a vast array of goods and services to humanity, both to people living in the mountains and to people living outside mountains. They are an important source of vital ecosystem services on which the regional and global environments and global economy largely depend and harbor a wide range of important natural resources. They make important contributions to economic development, environmental protection, ecological sustainability and human welfare, as well as to economic and ecological resilience in the downstream regions. About half of the world’s population depends on mountains for fresh water, clean energy, irrigation water, flood control, minerals, timber and non-timber forest products, recreation, and genetic resources. Mountains are also home to more than a billion people, a substantial proportion of who are indigenous ethnic communities whose livelihoods largely depend on natural resources available in mountain areas. Mountains are also a source of cultural, spiritual, and recreational resources for urban populations.

In Himalayan Country (Afghanistan, Bangladesh, Bhutan, China, India, Myanmar, Nepal and Pakistan), green economy for environmental governance is still in a developing stage and faces a lot of challenges. Eco tourism more often combines elements of wildlife conservation, cultural awareness, education, recreation and adventure. Eco-tourism, therefore, is gaining importance as a tool for conservation. Increasing importance has been given to the integration of environment and economic development in policy-planning process.  However particular in case of Indian Himalayan region, data deficiency clearly affects the policy making process.