Ecosystem Trading

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This presentation outlines the flawed concept of trading in ecosystems, and highlights some of the main problems with biodiversity offsetting

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Trading Ecosystems a bad idea for people, places and the planet

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Healthy ecosystems are vital for our own health and wellbeing – providing clean water, food and materials. Housing materials Clean water Food

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Activities such as large scale plantations and industries put too much strain on ecosystems , damaging the environment and threatening local livelihoods. Restricting community livelihoods. Polluting rivers, using up resources

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Housing materials Clean water Food In order to allocate financial value to the benefits provided by ecosystems, each benefit needs to be imagined separately, and called an ‘ecosystem service’. What do people mean by ‘ ecosystem services ’?

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This idea tries to separate the service ( clean water, food, building materials) from the ecosystem (land, river, forest, and wildlife in a particular place). What do people mean by ‘ ecosystem services ’?

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But each ‘ecosystem service’ only functions in tandem with others – separating them out might work for the accountants but it does not reflect reality . What do people mean by ‘ ecosystem services ’?

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1992: At the Rio earth summit world leaders agreed the need to protect ecosystems. They suggested a legal approach – setting a legal limit to ecosystem damage allowed from industry. 2012: Leaders met again in Rio and suggested protecting ecosystems by giving a financial value to the benefits they provide– paying people to protect ecosystems. This relies on the idea of ecosystem services . Global policymakers recognised protecting ecosystems is vital

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One idea to come out of the Rio +20 ‘green economy’ summit was the idea of trading in ecosystem credits . Ecosystem t rading, ecosystem offsetting Under these plans, companies ‘offset’ pollution in one ecosystem by buying ecosystem service ‘credits’ from another, healthy, ecosystem in a market. In an ecosystem market, credits might be available for different aspects of an ecosystem; carbon credits, water credits, biodiversity credits, and so on. This buying and selling ‘credits’ to offset pollution is what is meant by ecosystem trading .

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‘ Carbon offsetting ’ allows polluters to effectively bypass the legal limits set on greenhouse gas emissions. The major problems with carbon offsetting have been well documented. For more details on carbon trading, see FERN’s training series at http://www.fern.org/REDD-FLEGT-and-carbon-trading They tried this before with Carbon offsetting – it didn’t work

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There are some major problems with the idea of ecosystem offsetting…

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major problems with the idea of ecosystem offsetting Just as with carbon trading, trading ecosystem credits will allow companies to bypass laws designed to limit environmental damage.

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For more details on carbon trading, see FERN’s training series at http://www.fern.org/REDD-FLEGT-and-carbon-trading Additionality It is impossible to prove if avoided or reduced damage to an ecosystem would have happened even without the offset payment. Leakage Protecting an ecosystem in one place may make it more likely that another region, where offset credits are not available, may be destroyed. Measurability It is very difficult to measure the ‘value’ of a particular ecosystem service, making it impossible to compare against damage caused to another ecosystem elsewhere. The other major problems for carbon offsetting are also problems for ecosystem offsetting major problems with the idea of ecosystem offsetting

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Communities have little influence over the way land is allocated or used. Ecosystem trading is the opposite of pro-poor development . Government, conservation agencies and companies allocate both the polluted and the protected land amongst themselves with little reference to the people living on it and using it. Ignoring the social element major problems with the idea of ecosystem offsetting

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Geographical disconnect Environmental offsetting doesn’t solve the original problem of environmental damage, and is of no benefit to the communities burdened with that damage. Protected ecosystem doesn’t help affected communities Pollution still occurs major problems with the idea of ecosystem offsetting

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Who is going to fix the mess? Where do communities go for justice? Liability The question of determining who is liable (legally responsible) for damaging an ecosystem, and for repairing it, remains unanswered. If a company buys credits to ‘offset’ ecosystem damage, who has responsibility for repairing it? major problems with the idea of ecosystem offsetting

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Multiple ‘credits’ for one ecosystem Stacking With ecosystem credits, it could be possible to claim multiple credits for protecting a single ecosystem, which makes a mockery of ‘offset’ claims major problems with the idea of ecosystem offsetting

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major problems with the idea of ecosystem offsetting

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The rule of law is undermined Efforts to build environmentally and socially sustainable, industry are undermined Communities are sidelined Ecosystems are still destroyed In a world of Trading Ecosystems...

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FERN is publishing a series of accessible briefings on this topic. Find them at: www.fern.org/campaign/biodiversity-offsetting

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