Taking care of business: the private sector is waking up to nature’s value

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Megan C Evans, UNSW

For many businesses, climate change is an existential threat. Extreme weather can disrupt operations and supply chains, spelling disaster for both small vendors and global corporations. It also leaves investment firms dangerously exposed.

Businesses increasingly recognise climate change as a significant financial risk. Awareness of nature-related financial risks, such as biodiversity loss, is still emerging.

My work examines the growth of private sector investment in biodiversity and natural capital. I believe now is a good time to consider questions such as: what are businesses doing, and not doing, about climate change and environmental destruction? And what role should government play?

Research clearly shows humanity is severely damaging Earth’s ability to support life. But there is hope, including a change in government in the United States, which has brought new momentum to tackling the world’s environmental problems.

Now’s a good time to talk about how humans are wrecking the planet.
Daniel Mariuz/AAP

Poisoning the well

An expert report released last week warned Australia must cut emissions by 50% or more in the next decade if it’s to meet the Paris Agreement goals. Meeting this challenge will require everyone to do their bit.

Climate change is a major threat to Australia’s financial security, and businesses must be among those leading on emissions reduction. Unfortunately, that’s often not the case.

The finance sector, for example, contributes substantially to climate change and biodiversity loss. It does this by providing loans, insurance or investment for business activities that produce greenhouse gas emissions or otherwise harm nature.

In fact, a report last year found Australia’s big four banks loaned A$7 billion to 33 fossil fuel projects in the three years to 2019.

Australia’s big banks have been criticised for investing in fossil fuels.
Dean Sewell/Greenpeace

A pushback for nature

Promisingly, there’s a growing push from some businesses, including in the finance sector, to protect the climate and nature.

Late last year, Australian banks and insurers published the nation’s first comprehensive climate change reporting framework. And the recently launched Climate League 2030 initiative, representing 17 of Australia’s institutional investors with A$890 billion in combined assets, aims to act on deeper emissions reductions.

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Worried about Earth’s future? Well, the outlook is worse than even scientists can grasp

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Some companies are starting to put serious money on the table.
In August last year, global financial services giant HSBC and climate change advisory firm Pollination announced a joint asset management venture focused on “natural capital”. The venture aims to raise up to A$1 billion for its first fund.

Globally too, investors are starting to wake up to the cost of nature loss. Last month, investors representing US$2.4 trillion (A$3.14 trillion) in assets asked HSBC to set emissions reduction targets in line with the Paris Agreement. And in September last year, investor groups worth over $US103 trillion (A$135 trillion) issued a global call for companies to accurately disclose climate risks in financial reporting.

HSBC’s investors are pushing for stronger climate action.
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Climate change is not the only threat to global financial security. Nature loss – the destruction of plants, animals and ecosystems – poses another existential threat. Last year, the World Economic Forum reported more than half of the global economy relies on goods and services nature provides such as pollination, water and disease control.

Efforts by the finance sector to address the risks associated with biodiversity loss are in their infancy, but will benefit from work already done on understanding climate risk

Of course, acknowledging and disclosing climate- and nature-related financial risks is just one step. Substantial action is also needed.

Businesses can merely “greenwash” their image – presenting to the public as environmentally responsible while acting otherwise. For example, a report showed in 2019, many major global banks that pledged action on climate change and biodiversity loss were also investing in activities harmful to biodiversity.

The global economy depends on the goods and services nature provides.
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Getting it right

In the financial sector and beyond, there are risks to consider as the private sector takes a larger role in environmental action.

Investors will increasingly seek to direct capital to projects that help to reduce their exposure to climate- and nature-related risks, such ecosystem restoration and sustainable agriculture.

Many of these projects can help to restore biodiversity, sequester carbon and deliver benefits for local communities. But it’s crucial to remember that private sector investment is motivated, at least in part, by the expectation of a positive financial return.

Projects that are highly risky or slow to mature, such as restoring highly threatened species or ecosystems, might struggle to attract finance. For example, the federal government’s Threatened Species prospectus reportedly attracted little private sector interest.

That means governments and philanthropic donors still have a crucial role in the funding of research and pilot projects.

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A major report excoriated Australia’s environment laws. Sussan Ley’s response is confused and risky

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Governments must also better align policies to improve business and investor confidence. It is nonsensical that various Australian governments send competing signals about whether, say, forests should be cleared or restored. And at the federal level, biodiversity loss and climate change come under separate portfolios, despite the issues being inextricably linked.

Private-sector investment could deliver huge benefits for the environment, but these outcomes must be real and clearly demonstrated. Investors want the benefits measured and reported, but good data is often lacking.

Too-simple metrics, such as the area of land protected, don’t tell the whole story. They may not reflect harm to local and Indigenous communities, or whether the land is well managed.

Finally, as the private sector becomes more aware of nature and climate-related risks, a range of approaches to addressing this will proliferate. But efforts must be harmonised to minimise confusion and complexity in the marketplace. Governments must provide leadership to make this a smooth process.

Threatened species habitat restoration may struggle to attract private sector funding.
Eric Woehler

The power to change

Last week, a major report was released highlighting grave failures in Australia’s environmental laws. The government’s response suggested it is not taking the threat seriously.

Businesses and governments hold disproportionate power that can be used to either delay or accelerate transformative change.

And although many businesses wield undue influence on government decisions, it doesn’t have to be this way.

By working together and seizing the many opportunities that present, business and government can help arrest climate change and nature loss, and contribute to a safer, more liveable planet for all.

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Read more:
You can’t talk about disaster risk reduction without talking about inequality

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Megan C Evans, Lecturer and ARC DECRA Fellow, UNSW

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Trees can add $50,000 value to a Sydney house, so you might want to put down that chainsaw

Allowing residents to remove trees within three metres of buildings or ‘ancillary structures’ could dramatically alter the green infrastructure of dense inner Sydney suburbs like Rozelle.
Tom Casey/Shutterstock

Sara Wilkinson, University of Technology Sydney; Agnieszka Zalejska-Jonsson, KTH Royal Institute of Technology, and Sumita Ghosh, University of Technology Sydney

Sydney’s Inner West Council has a new policy that it is reported means “residents will no longer need to seek council approval to prune or remove trees within three metres of an existing home or structure”. Hold on, don’t reach for that chainsaw yet, because research shows good green infrastructure – trees, green roofs and walls – can add value to your home.

Green infrastructure offers significant, economic, social and environmental benefits. Urban greening is particularly important in dense urban areas like Sydney’s Inner West. Among its benefits, green infrastructure:

• improves air quality
• provides space for social interaction
• manages stormwater
• reduces the urban heat island effect
• provides space for urban food production
• improves biodiversity.

Some of these benefits accrue to owners/occupiers, whereas others provide wider societal benefits.

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Read more:
Higher-density cities need greening to stay healthy and liveable

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A 2017 study focusing on three Sydney suburbs found a 10% increase in street tree canopy could increase property values by A$50,000 on average. And the shading effect of trees can reduce energy bills by up to A$800 a year in Sydney. So retaining your green infrastructure – your trees, that is – can deliver direct financial gains.

On a larger scale, a collaborative project with Horticulture Innovation Australia Limited compared carbon and economic benefits from urban trees considering different landuses along sections of two roads in Sydney. Higher benefits were recorded for the Pacific Highway, with 106 trees per hectare and 58.6% residential land use, compared to Parramatta Road, with 70 trees per hectare and 15.8% residential.

For the Pacific Highway section, total carbon storage and the structural value of trees (the cost of replacing a tree with a similar tree) were estimated at A$1.64 million and A$640 million respectively. Trees were also valuable for carbon sequestration and removing air pollution.

Tree species, age, health and density, as well as land use, are key indicators for financial and wider ecosystem benefits. Specifically, urban trees in private yards in residential areas are vital in providing individual landowner and collective government/non-government benefits.

Take away the trees close to these houses in Marrickville, in Sydney’s Inner West, and how much would be left?
Graeme Bartlett/Wikipedia, CC BY-SA

Challenges of growth

As populations grow, cities increase density, with less green infrastructure. The loss of greenery affects the natural environment and both human and non-human well-being.

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Read more:
We’re investing heavily in urban greening, so how are our cities doing?

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Tree canopy cover across Greater Sydney plummets closer to the city centre.
© State of New South Wales through the Greater Sydney Commission. Data: SPOT5 Woody Extent and Foliage Projective Cover (FPH) 5-10m, 2011, NSW Office of Environment and Heritage

Trees and other green infrastructure reduce some impacts of urban density. However, policies, government incentives and national priorities can produce progress in urban greening or lead to setbacks. In the case of the Inner West Council, for instance, the inability to fund monitoring of changes in tree cover could lead to reductions at the very time when we need more canopy cover.

Key concerns include installation and maintenance costs of green infrastructure (trees, green roofs and walls) in property development, and tree root damage. Knowledge and skills are needed to maintain green infrastructure. As a result, developers often consider other options more feasible.

In the short and long term, multiple performance benefits and economic and environmental values are needed to establish the viability of green infrastructure.

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Read more:
Australian cities are lagging behind in greening up their buildings

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Learning from Stockholm

Stockholm shares many issues found in Australian cities. Stockholm houses over 20% of Sweden’s inhabitants, is increasing in density and redeveloping land to house a growing population. Aiming to be fossil-free by 2050, Stockholm acknowledges the built environment’s role in limiting climate change and its impacts.

In a research project we intend to use virtual reality (VR) and electroencephalogram (EEG) technology to assess perceptions of green infrastructure and reactions to it in various spaces.

Our project combines VR with EEG hardware, which measures human reactions to stimuli, to learn how people perceive and value green infrastructure in residential development.

Identifying all the value of green infrastructure

The many benefits of green infrastructure are both tangible and non-tangible. Economic benefits include:

• those that directly benefit owners, occupants or investors – stormwater, increased property values and energy savings
• other financial impacts – greenhouse gas savings, market-based savings and community benefits.

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Read more:
If planners understand it’s cool to green cities, what’s stopping them?

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The various approaches to evaluating net value present a challenge in quantifying the value of green infrastructure. The most common – cost-benefit analysis, triple bottom line, life cycle assessment and life cycle costing – are all inadequate for evaluating trade-offs between economic and environmental performance. Conventional cost-benefit analysis is insufficient for investment analysis, as it doesn’t include environmental costs and benefits.

This is salient for green infrastructure, as owners/investors incur substantial direct costs, whereas various shareholders share the value. Perhaps, in recognition of the shared value, a range of subsidies could be adopted to compensate investors. Discounted rates anyone?

Recent efforts to evaluate the business case for green infrastructure include attempts to identify and quantify the creation of economic, environment and community/social value. However, an approach that includes a more comprehensive set of value drivers is needed to do this. This is the gap we aim to fill.

The results of experiments using VR and EEG technology and semi-structured interviews will provide a comprehensive understanding of green infrastructure. This will be correlated with capital and rental values to determine various degrees of willingness to pay.

With this knowledge, property developers in Sweden and Australia will be able to make a more informed and holistic business case for increasing green infrastructure for more liveable, healthy cities.

Maybe we can then persuade more people, including those in the Inner West, to hang onto their trees and leave the chainsaws in the garage.

Sara Wilkinson, Professor, School of the Built Environment, University of Technology Sydney; Agnieszka Zalejska-Jonsson, Researcher, Division of Building and Real Estate Economics, KTH Royal Institute of Technology, and Sumita Ghosh, Associate Professor in Planning, School of the Built Environment, University of Technology Sydney

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Elephants and economics: how to ensure we value wildlife properly

Botswana’s elephants are officially an economic asset.
Ian Sewell/Wikimedia Commons, CC BY-SA

Michael Vardon, Australian National University; Carl Obst, University of Melbourne, and David Lindenmayer, Australian National University

Ensuring the economic health of nations is one of the biggest tasks expected of governments. The elephant in the room has long been the health of the environment, on which the health of the economy (and everything else) ultimately depends.

Most countries still rely on gross domestic product as the lead measure of their economic health. But this does not account for the loss of environmental condition. There is a growing recognition of the environmental damage that human activity causes, our dependence on a functioning environment, and the need for new approaches to measure and manage the world.

We hope this new idea can be advanced internationally at the two-week meeting of the Convention on Biological Diversity, which began this week in Sharm El-Sheikh, Egypt.

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Read more:
Why we need environmental accounts alongside national accounts

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Integrating the environment into national accounts has long been suggested as a way to improve information and has been tried in several countries.

In Botswana, where elephants are included in the nation’s environmental accounts, spending on wildlife conservation is now seen as an investment, rather than a cost. This example shows how integrating environmental assets into economic data can help provide a new policy framing for conservation. But worldwide, this type of “expanded accounting” has had limited impact on policy decisions so far.

On target

The Convention on Biological Diversity includes what are known as the Aichi Targets. Target 2 states:

By 2020, at the latest, biodiversity values have been integrated into national and local development and poverty reduction strategies and planning processes and are being incorporated into national accounting, as appropriate, and reporting systems. (emphasis added)

This provides a clear starting point for conservationists and economists to work together. So far, little has been done on the valuation of biodiversity, and the work that has been done so far has not progressed very far on the question of how to integrate environmental and economic values into national accounting.

On one hand, putting monetary values on biodiversity has been decried as the commodification of nature. But we argue that without using appropriately defined monetary values, the environment will always be vulnerable to economic forces. If Aichi Target 2 is to be met by 2020, we clearly need an agreed concept of biodiversity value, and a shared approach to recognising it.

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Read more:
It pays to invest in biodiversity

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Crucially, as well as calculating the environment’s contribution to the economy, we also need to assess the requirements for maintaining and enhancing biodiversity. To return to the example of Botswana’s elephants, this means recognising that elephants need land and water (Botswana’s wildlife consumes 10% of all its water, with elephants accounting for most use). As tourism-related industries generated roughly US$2 billion in 2013 (Botswana’s second-largest sector by revenue, with mining the first), the allocation of water and land to wildlife is clearly a prudent investment decision.

This approach can also reveal the impacts and trade-offs resulting from different land uses on environmental values. In Victoria’s Central Highlands, for example, the cessation of native logging would reduce revenue from timber production, but would also help support a range of rare and endangered species, including Leadbeater’s Possum. It would also benefit a range of other industries like agriculture, as well as the people in cities like Melbourne.

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Logging must stop in Melbourne’s biggest water supply catchment

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Keeping the books up to date

Like any accounting system, these estimates of the economic value of the environment would need to be updated, ideally annually, if they are to remain relevant in underpinning governments’ decisions. This would also entail regular data collection on the species and ecosystems themselves.

Unfortunately, however, consistent long-term nationwide monitoring of biodiversity at the species or ecosystem level is rarely done. And while remote-sensing offers some promise for landscape-scale monitoring of major ecosystem types (such as tropical savannahs, temperate forests, wetlands), there is generally no substitute for boots on the ground.

This month’s summit in Egypt offers an opportunity for countries to reaffirm their recognition of the benefits that biodiversity provides to people and the economy. It also provides a chance to go further, to agree that integrated accounting will help us understand and appreciate the trade-offs between the environment and economy.

Recognising and accounting for the elephant in the room would be a great achievement – not to mention a sound investment in the future.

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The authors would like to acknowledge the contribution of Heather Keith to this article.

Michael Vardon, Associate Professor at the Fenner School, Australian National University; Carl Obst, Honorary Research Fellow, Melbourne Sustainable Society Institute, University of Melbourne, and David Lindenmayer, Professor, The Fenner School of Environment and Society, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The moral value of wilderness

Pause and reflect on what really makes wilderness valuable.
John O’Neill/Wikimedia Commons, CC BY-SA

Janna Thompson, La Trobe University

Let us imagine that humanity has almost died out and only a few people remain. Out of resentment or despair, the survivors cater to their destructive urges by destroying as much of the natural world as they can. They poison rivers and lakes, drop napalm on forests, set off a few nuclear warheads. They are at ease with their conscience because no one will ever be in the position to use or appreciate the nature they are destroying.

They are harming no one. But surely what they are doing is wrong.

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Read more:
Explainer: wilderness, and why it matters

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The Australian environmental philosopher Richard Sylvan used this story to try to persuade us that nature has a value that is independent of our needs and desires, even our existence.

The predicament he imagines is a fiction. But the ethical problem is very real. Experts tell us that human activity is causing the world’s wilderness areas to disappear at an alarming rate. In 100 years there may be no wilderness left.

Those who deplore this development usually focus on the negative implications for human well-being: increasing environmental dysfunction, loss of species diversity and of the unknown benefits that wilderness areas might contain.

But Sylvan’s thought experiment – involving the last people alive, and therefore removing the consideration of humans’ future well-being – shows us that much more is at stake. It is morally wrong to destroy ecosystems because they have value in their own right.

Questions of value

Some philosophers deny that something can have value if no one is around to value it. They think that ethical values exist only in our minds. Like most philosophical propositions, this position is debatable. Sylvan and many others believe that value is as much a part of the world as matter and energy.

But let us assume that those who deny the independent existence of values are right. How then can we condemn the destructive activities of the last people or deplore the loss of wilderness and species for any other reason than loss of something useful to humans?

The kind of experiences that something provides can be a reason for regarding it as valuable for what it is, and not merely for its utility. Those who appreciate wilderness areas are inclined to believe that they have this kind of value. Henry David Thoreau wrote in Walden: “We need to witness our own limits transgressed, and some life posturing freely where we never wander.”

The Great Barrier Reef “is the closest most people will come to Eden”, said the poet Judith Wright, who helped to lead a protest movement in the 1960s and 1970s against the plans of the Bjelke-Petersen Queensland government to drill for oil on the reef.

Thoreau and Wright value wilderness not merely because it the source of enjoyment and recreational pleasure, but also because it can teach us something profound – either through its astonishing beauty or by putting our own human lives in perspective. In this way, wild nature is valuable for much the same reasons that many people value great works of art.

If the last people had set about destroying all the artworks in all the great museums of the world, we would call them vandals. Objects of great spiritual or aesthetic value deserve respect and should be treated accordingly. To destroy them is wrong, regardless of whether anyone will be here to appreciate them in the future.

Like nowhere else on Earth

Wright and her fellow protesters aimed to make Australians realise that they possessed something remarkable that existed nowhere else on the face of the planet. They wanted Australians to recognise the Great Barrier Reef as a national treasure. They were successful. It was given World Heritage status in 1981 and was listed as national heritage in 2007.

The Great Barrier Reef is also recognised as the heritage of more than 70 Aboriginal and Torres Strait Islander groups. Much of what Westerners think of as wilderness is in fact the ancestral territory of indigenous people – the land that they have cared for and treasured for many generations.

Recognising a wilderness area as heritage gives us another reason for thinking that its value transcends utility.

Heritage consists of objects, practices and sites that connect people with a past that is significant to them because of what their predecessors did, suffered or valued. Our heritage helps to define us as a community. To identify something as heritage is to accept a responsibility to protect it and to pass it on to further generations.

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Read more:
Earth’s wildernesses are disappearing, and not enough of them are World Heritage-listed

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We have many reasons to recognise wilderness areas like the Great Barrier Reef as heritage. They are special and unique. They play a role in a history of how people learned to understand and appreciate their land. They provide a link between the culture of Aboriginal people – their attachment to their land – and the increasing willingness of non-Aboriginal Australians to value their beauty and irreplaceability.

The last people cannot pass on their heritage to future generations. But valuing something as heritage makes it an object of concern and respect. If people cherish and feel connected to wild environments and the creatures that live in them, they should want them to thrive long after we are gone.

We, who do not share the predicament of the last people, have a duty to pass on our heritage to future generations. This gives us an even stronger moral reason to ensure the survival of our remaining wilderness areas.

Janna Thompson, Professor of Philosophy, La Trobe University

This article was originally published on The Conversation. Read the original article.

Money can’t buy me love, but you can put a price on a tree

Mountain ash in the Victorian Central Highlands.
Takver/Flickr, CC BY-SA

Heather Keith, Australian National University; David Lindenmayer, Australian National University, and Michael Vardon, Australian National University

What is something worth? How do you put a dollar value on something like a river, a forest or a reef? When one report announces that the Great Barrier Reef is worth A$56 billion, and another that it’s effectively priceless, what does it mean and can they be reconciled?

This contrast points to fundamentally different notions of value. Environmental accounting is a way of recognising and comparing multiple sources of value, in order to better weigh competing priorities in resource management.

In practice it is sometimes crude, but it’s been standardised internationally and its scope is expanding to include social, cultural, and intrinsic benefits.

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Read more: What’s the economic value of the Great Barrier Reef? It’s priceless

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Using environmental accounting we’ve investigated the tall, wet forests of Victoria’s Central Highlands to weigh the competing economic cases for continuing native timber harvesting and creating a Great Forest National Park. But first we’ll explain a little more about environmental accounting, and how we put a price on trees.

What we count

Essentially, environmental accounting involves identifying the contributions of the environment to the economy, summarised as gross domestic product (GDP). In Australia, the Australian Bureau of Statistics standardises the data and reporting of these contributions in the System of National Accounts. The Bureau also produces environmental accounts that extend the range of information presented – e.g. water and energy use and greenhouse gas emissions.

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Read more: Why we need environmental accounts alongside national accounts

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But there are other things of value, like positive environmental and social outcomes, worth incorporating into calculations. Ecosystem accounting gives researchers a framework for doing this, extending the accounting to look at the value of different “ecosystem services” – the contributions of ecosystems to our wellbeing – and not just goods and services captured in our national accounts or environmental accounts.

For example, businesses and homes pay a price for water delivery, but the supplier doesn’t pay for the water that entered the dam. That water is an ecosystem service created by forests and the atmosphere. By assessing costs in the water supply industry, we can estimate the value of the ecosystem service of water provisioning.

The value of Victoria’s Central Highlands

Victoria’s Central Highlands are contested ground. Claims and counter-claims abound between the proponents of native timber production and those who are concerned about the impacts of logging on water supply, climate abatement and threatened species.

Our research has, for the first time, directly compared the economic and environmental values of this ecosystem. It shows that creating a Great Forest National Park is clearly better value.

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Read more: Why Victoria needs a Giant Forest National Park

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With any change in land management, there will be gains and losses for different people and groups. Assessing these trade-offs is complex, made even more so by patchy and inconsistent data.

Through careful accounting, we synthesised the available data and calculated the annual contributions of industries to GDP. In 2013-14, the latest year for which all financial data were available, these came to A$310 million for water supply, A$312 million for agriculture, A$260 million for tourism and potentially A$49 million for carbon storage. (There is no current market for carbon stored in native forests in Australia – more on that in a minute.)

All of this far exceeds the A$12 million from native timber production. Although timber production is a traditional industry, its contribution to the regional economy is now comparatively small.

The GDP contribution in millions of dollars by primary industries in 2013-14.
Author provided

The industries that use ecosystem services are classified as primary production – agriculture, forestry and water supply. This classification is comprehensive (it covers all economic activities) and mutually exclusive (there is no overlap of categories). Downstream uses of the products from agriculture, forestry and water supply are an important consideration for the industries as a whole, but are included in manufacturing industries and not in ecosystem accounts.

Older forests are more valuable

Native timber production involves clearfell harvesting (removing the majority of trees at the site) and slash burning (using high-intensity fire to burn logging residue and provide an ash bed for regeneration). Regenerating forests are younger, with all trees the same age, and have lower species diversity.

This means these young forests contribute less to biodiversity, carbon storage, water supply and recreation. Therefore harvesting native timber requires a trade-off between these conflicting activities.

Trade-offs between industries in their use of ecosystem services can be complementary (green) or conflicting (red).
Author provided

But more than 60% of the native timber harvested in the Central Highlands is used for pulp. This can be substituted by production from plantations that are more efficient and increased use of recycled paper. Both softwood and hardwood plantations can provide substitute sawlogs.

If we phased out native forest harvesting, increases in the value of water supply and carbon storage would offset the loss of A$12 million per year contributed by the industry. (It would also most likely increase profits for the tourism and plantation timber sectors.)

Older trees use less water than young regrowth, and allowing native forests to age would increase the supply of water to Melbourne’s main reservoirs by an estimated 10.5 gigalitres per year. That’s worth A$8 million per year. Security of water supply for the increasing population of Melbourne is an ever-present concern, particularly with projected decreases in rainfall and streamflow.

Older forests also store more carbon than younger regrowth forests. The federal government’s Emission Reduction Fund does not recognise native forest management as an eligible activity for carbon trading, but if this changed the forest could earn carbon credits worth A$13 million per year. This would provide an ongoing and low-cost source of carbon abatement, which could be used to meet Australia’s emissions reduction targets, while the Victorian government could use the money gained to support an industry transition.

Of course, economic benefit is only one way of looking at land. We know that the Central Highlands is home to unique flora and fauna that cannot be replaced (much of which is increasingly under threat). But careful environmental accounting can help explicitly define the various trade-offs of different activities.

It’s particularly important when legacy industries – like native timber harvesting – are no longer environmentally or economically viable. The accounting reveals the current mix of benefits and costs, allowing management of this area to be reconsidered.

Heather Keith, Research Fellow in Ecology, Australian National University; David Lindenmayer, Professor, The Fenner School of Environment and Society, Australian National University, and Michael Vardon, Visiting Fellow at the Fenner School, Australian National University

This article was originally published on The Conversation. Read the original article.

As a coastal defence, the Great Barrier Reef’s value to communities goes way beyond tourism

Parts of the Great Barrier Reef’s outer reefs can form a natural barrier to coastal recession, thus protecting urban centres.
AAP

Mark Gibbs, Queensland University of Technology

Rising sea levels are widely recognised as a threat to coastal communities worldwide. In Australia, the Climate Council estimates that at least A$226 billion of assets and infrastructure will be exposed to inundation if sea levels rise by 1.1 metres. Another report recommended that global mean sea level rise of up to 2.7 metres this century should be considered in planning processes.

The Queensland state government has commissioned the QCoast2100 program. This program aims to help with the development of coastal climate adaptation plans for Queensland communities exposed to sea-level rise.

Although the largest population centres in Queensland are in the state’s southeast, several of the most populous regional centres in Australia are located along the Great Barrier Reef coastline between Gladstone and Cape York. These include Townsville, Cairns, Gladstone, Mackay and Port Douglas.

A major task in developing coastal adaptation plans under the QCoast2100 program is to model inundation from a range of scenarios for sea-level rises and assess how assets will be inundated in the future. However, another threat is on the horizon.

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Further reading: What’s the value of the Great Barrier Reef? It’s priceless

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How urban centres are protected

Urban centres along the reef’s coastline, which forms the majority of the Queensland coast, are protected from major ocean storms by natural deposits of coastal sediments. These include dunes and associated vegetation such as coastal forests, wetlands and mangrove systems.

These natural features continue to exist largely because the Great Barrier Reef’s outer reefs dampen incoming ocean waves. Although exposed to the occasional cyclone – which can lead to short-term erosion at specific locations – much of the coastal zone inside the reef is slowly growing out into the sea.

This increasing buffer zone can form a natural barrier to coastal recession.

A recently released report estimated the total economic, social and icon asset value of the Great Barrier Reef at A$56 billion. By design, this report did not include many of the ecosystem services the reef provides. One of these is its role in reducing the energy of waves that impact the coastline behind the reef.

However, an earlier assessment of the total economic value of ecosystem services delivered by the reef estimated the present coastal protection benefit is worth at least A$10 billion.

Despite the inherent uncertainties in such assessments, it is clear the reef acts to reduce incoming wave energy and its impacts on cities and towns along much of the Queensland coastline. The total economic value of these benefits is in the billions of dollars.

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Further reading: Coastal communities demand action on climate threats

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What role is bleaching playing?

The Great Barrier Reef’s ability to keep protecting the Queensland shoreline, and communities living along it, depends upon the ability of individual reefs in the system to grow vertically to “keep up” with rising sea level.

The jury is still out on whether the outer reefs will be able to keep up with predicted rises. This is an active area of research.

However, it is clear reefs that are extensively affected by coral bleaching will struggle to maintain the essential processes required for productive reef-building. Many reefs are now experiencing net erosion.

Predictions of ocean warming suggest that bleaching events will become even more common in coming decades. Increasing levels of atmospheric carbon dioxide are also making the oceans more acidic, which makes it more difficult for organisms such as corals to maintain their skeletons, which are made of calcium carbonate. This mineral dissolves more rapidly with increasing acidification, reducing the reef’s capacity to recover from storm damage and coral bleaching.

Therefore, as bleaching events and acidification continue, the outer reefs that protect the Queensland coast from ocean waves will increasingly struggle to perform this function.

In turn, over time the Queensland coast will potentially suffer from more coastal erosion, which may increase the vulnerability of coastal infrastructure. This effect, combined with rising sea levels leading to more coastal inundation events, multiples the risks to coastal settlements and infrastructure.

Mark Gibbs, Director, Knowledge to Innovation; Chair, Green Cross Australia, Queensland University of Technology

This article was originally published on The Conversation. Read the original article.

What’s the economic value of the Great Barrier Reef? It’s priceless

Neil Perry, Western Sydney University

Deloitte Access Economics has valued the Great Barrier Reef at A$56 billion, with an economic contribution of A$6.4 billion per year. Yet this figure grossly underestimates the value of the reef, as it mainly focuses on tourism and the reef’s role as an Australian icon.

When you include aspects of the reef that the report excludes, such as the ecosystem services provided by coral reefs, you find that the reef is priceless.

Putting a price on the Great Barrier Reef buys into the notion that a cost-benefit analysis is the right way to make decisions on policies and projects that may affect the reef. For example, the environmental cost of the extension to the Abbot Point coal terminal can be compared to any economic benefits.

But as the reef is both priceless and irreplaceable, this is the wrong approach. Instead, the precautionary principle should be used to make decisions regarding the reef. Policies and projects that may damage the reef cannot go ahead.

How do you value the Great Barrier Reef?

The Deloitte report uses what’s known as a “contingent valuation” approach. This is a survey-based methodology, and is commonly used to measure the value of non-market environmental assets such as endangered species and national parks – as well as to calculate the impact of events such as oil spills.

In valuing the reef, surveys were used to elicit people’s willingness to pay for it, such as through a tax or levy. This was found to be A$67.60 per person per year. The report also uses the travel-cost method, which estimates willingness to pay for the Great Barrier Reef, based on the time and money that people spend to visit it. Again, this is commonly used in environmental economics to value national parks and the recreational value of local lakes.

Of course, all methods of valuing environmental assets have limitations. For example, it is difficult to make sure that respondents are stating realistic amounts in their willingness to pay. Respondents may act strategically if they think they really will be slugged with a Great Barrier Reef levy. They may conflate this environmental issue with all environmental issues.

But more importantly, the methodology in the report leaves out the most important non-market value that the reef provides, which are called ecosystem services. For example, coral reefs provide storm protection and erosion protection, and they are the nurseries for 25% of all marine animals which themselves have commercial and existence value.

The Deloitte report even cites (but does not reference) a 2014 study that values the ecosystem services provided by coral reefs at US$352,249 per hectare per year. The Great Barrier Reef Marine Park covers 35 million hectares with 2,900 individual reefs of varying sizes. This means the ecosystem services it provides are worth trillions of dollars per year.

That is, it is essentially priceless.

The problem with putting a value on the Reef

Valuing the environment at all is contentious in economics. Valuation is performed so that all impacts from, say, a new development, can be expressed in a common metric – in this case dollars. This allows a cost-benefit analysis to be performed.

But putting a price on the Great Barrier Reef hides the fact that it is irreplaceable, and as such its value is not commensurate with the values of other assets. For instance, using Deloitte’s figure, The Australian newspaper compared the reef to the value of 12 Sydney Opera Houses. But while they are both icons, the Opera House can be rebuilt. The Great Barrier Reef cannot. Any loss is irreversible.

When environmental assets are irreplaceable and their loss irreversible, a more appropriate decision-making framework is the Precautionary Principle.

The Precautionary Principle suggests that when there is uncertainty regarding the impacts of a new development on an environmental asset, decision makers should be cautious and minimise the maximum loss. For example, if it is even remotely possible that the extension to the Abbot Point coal terminal could lead to massive destruction of the reef, then precaution suggests that it shouldn’t go ahead.

Assigning a value to the reef might still be appropriate under the Precautionary Principle, to estimate the maximum loss. But it would require the pricing of all values and especially ecosystem services.

While the Precautionary Principle has been much maligned due to its perceived bias against development, it is a key element of the definition of Ecologically Sustainable Development in Australia’s Environment Protection and Biodiversity Conservation Act 1999.

For a priceless asset like the Great Barrier Reef, it is perhaps better to leave it as “priceless” and to act accordingly. After all, if the Precautionary Principle is ever going to be used when assessing Ecologically Sustainable Development, in contrast with cost-benefit analysis and valuations, it is surely for our main environmental icon.

Ultimately, the protection and prioritisation of the Great Barrier Reef is a political issue that requires political will, and not one that can be solved by pricing and economics.

Neil Perry, Research Lecturer, Western Sydney University

This article was originally published on The Conversation. Read the original article.

Blackbutt Reserve

Kevin's Daily Photo, Video, Quote or Link

Since I was unable to visit Gap Creek Falls the other day, I decided I might pop in to have a look at the new animal enclosures at Blackbutt Reserve near Newcastle. I will say straight off the bat that I do have something of a prejudice against Blackbutt Reserve, as I see the place as nothing like a natural bush setting, it being far too ‘corrupted’ by human activity, weeds and the like. Having said that it is a good place for a family or group outing/event. It certainly has its place, but it is not a true nature reserve (in my opinion).

ABOVE: Visitor Centre

I do think that some well designed animal and bird enclosures at Blackbutt could lift the value of the reserve dramatically and make it a really great place for families, especially young families. There are opportunities for educational visits for kids, possible environmental…

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Latest News on the Web Site

Latest News on the Web Site

My website is currently down – for the most part anyway. I hope to have it back up in the near future. Why is it down? My previous hosting service put their prices up dramatically from the previous renewal of the site. It was nearly doubled and I found that sort of hike unacceptable. I have therefore sought out a new hosting service and believe I now have great value for money, as well as a far better service. The site will now have the same address as it has had for several years:

http://kevinswilderness.com

The site I was intending to move to at WordPress.com, will now become the Blog for site updates, news, etc. It can be found at:

http://kevinswilderness.wordpress.com/

For the time being the site will continue to be down, with improvements being made as the site is transferred across to the new hosting company. Please keep returning to the site as I hope to bring pages back online on a regular basis.

 

Copenhagen Summit Fails to Deliver

In news that has delighted the ears of climate change sceptics the world over, the Copenhagen summit on climate change has failed to deliver anything of real value that will actually make a difference. It is truly disappointing that even in the face of a massive environmental disaster that will affect the entire planet, global leaders have failed to lead and work together in finding solutions to the major issues we face over the coming decades and century.

Newspapers in Australia have reported the failure of the summit and are reporting on the leader of the opposition gloating over the failure of the summit. His solution is to ignore the real issue and hope that the Australian people prove to be as oblivious to climate change as the coalition he leads.

Typically, the usual anti-Kevin Rudd biased journalists and climate change sceptics of the newspaper (The Sunday Telegraph) I read this morning, were also quick to pour further scorn on the Prime Minister and the problem of climate change itself (which they deny). One particular vocal climate change sceptic in the Sunday Telegraph has very little credibility with me and I find his obsessive anti-Rudd tirades more than a little tiring. This self-opinionated buffoon is little more than an embarrassment for both the Sunday Telegraph and the Daily Telegraph for which he also writes. His columns are becoming more of a personal vendetta against Kevin Rudd than anything resembling real journalism.

I’ll be finding a better way to become acquainted with the daily news than continuing to read the biased diatribes that continue to be put forward by these papers in future. I’ll also be hoping that our leaders can overcome the various preoccupations each have with self-interest (whether it be personal or national) in order to reach a real workable agreement on dealing with the growing threat of climate change