Stacking ecosystem services in the Panama Canal watershed
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1 Stacking ecosystem services in the Panama Canal watershed Silvio Simonit & Charles Perrings Ecoservice Group, Arizona State University
2 RESEARCH OBJECTIVES: Construct a spatially-explicit model to map the impact of land cover change on dry season flows and its related value in terms of toll revenue to Panama Canal Authority. Improve our understanding of the spatial dimension defining the linkages between multiple flows of ecosystem services. We model: a) The hydrological impact of vegetation change which depends on the combined effects on surface runoff, groundwater recharge, baseflow and evapotranspiration. a) The synergies and/or tradeoffs with other services, i.e. carbon sequestration, timber and livestock production.
3 Gatun Lake: - basin = 1,922 Km2 - wet season runoff = 2,591 MMC Madden Lake: - basin= 982 Km2 - wet season runoff = 1,990 MMC
4 Dry season flows are crucial to Canal operations. Precipitation is highly seasonal and highly variable across years. General belief that additional forest cover would produce an increased sponge effect. Proposed extensive reforestation programme. Gatun Lake levels Annual water balance Inflow Evaporation (51.1%) Madden Spillage Inflow Gatun Hydro Water intake (3%) Hydro (13.3%) Locks (28.9%) Spillage (3.7%)
5 LULC landscape architecture Modeling framework Rainfall, Topography, Soil Runoff Hydrological processes Runoff Evapotransp. Wet season recharge Dry season flow regulation value Carbon storage Evapotransp. Carbon value Timber production Timber value Land use Ecosystem service flows Wet season flow (groundwater recharge) Dry season flow (baseflow + runoff) Socio-economic impact
6 LULC type (Z ij ) The Economic Problem F i Ecosystem Service D ij,y ij,z ij 0 Carbon bundle output Z i1 = natural forest D ij Dry season water flow regulation X i1 Carbon storage Z i2 = teak plantations Z i3 = grassland Y i1 Y i2 Natural forest carbon bundle Forest plantations carbon bundle X i2 X i3 Timber production Livestock production Y i3 Grassland carbon bundle Water regulation: D ij D ij (Z ij ) Carbon storage bundles: Net benefit function: i Y i1 Y i1 Y i2 Y i2 Y i3 Y i3 D ij,y ij,z ij,v,wv D D ij V j Y ij W j Z ij X i1,0,z i1 X i1, X i2,z i2 X i1, X i3,z i3 j 1,2,3 Lagrangian: L i V D D ij V j Y ij W j Z ij i F i D ij,y ij,z ij
7 First Order Conditions L V D i D ij L V j i Y ij L W j i Z ij F D ij 0 F Y ij 0 F Z ij 0 L FD ij,y ij, Z ij 0 i (1) (2) (3) (4) μ The measure of the marginal social value of a small variation in watershed outputs V D V j Y ij D ij F D ij F Y ij The rate of transformation between ecosystem services is the rate at which one service has to be given up to obtain the other W j V D D ij Z ij The cost of land cover j should be equal to the value of the marginal product of that land cover type with respect to dry season water flow
8 Runoff modeling: The Curve Number (CN) approach HSG LULC + = LULC HSG A B C D CN value Forests Schrubs Plantations Grassland Agriculture Residential Bareland Water Source: USDA-SCS (1972)
9 Wet season Rainfall Wet season flows (groundwater recharge) Wet season Runoff Actual Evapotranspiration
10 Dry season flows (baseflow + runoff) Groundwater recharge Dry season discharge
11 Model fitting & Dry season flow calibration (ith sub-basins) +8.5% +3.8% +5.0% -4.0% Q i Min xqi 6 i1 2 P x S x,p P x x S x 1 S x Q i ˆQ i 2, Q i Predicted runoff for sub-basin i -2.1% ˆQ i Observed runoff for sub-basin i -2.7%
12 The impact of existing forest cover on hydrological flows The net impact of vegetation change depends on its effects on surface runoff, groundwater recharge, baseflow and evapotranspiration. If infiltration is reduced by more than the reduction in evapotranspiration, then dry season flows will fall.
13 NATURAL FOREST: economic value of existing cover Water flow regulation alone Water flow regulation + Carbon sequestration
14 GRASSLAND: value of conversion into natural forest Water flow regulation alone Water flow regulation + Carbon sequestration
15 NATIURAL FOREST & GRASSLAND conversion Water flow regulation + Carbon sequestration + Timber production
16 Sensitivity Analysis Grassland conversion to natural forest Grassland conversion to teak plantations Current forest cover with positive value
17 FINDINGS: The efficiency of grassland conversion within the watershed depends entirely on the bundle of ecosystem services that are at issue. Efficiency in joint production requires reforestation to be increased up to the point at which the marginal benefit of a hectare of new forest in terms of carbon sequestered is sufficient to offset the marginal cost in terms of lost water flow regulation (Equimarginal Principle). Water flow costs could be balanced by carbon sequestration gains at a level of conversion to natural forest equal to 45% of existing grassland at 4 $ t -1 C. Water flow costs could be balanced by carbon sequestration plus teak production gains at a level of conversion to natural forest equal to 100% of existing grassland regardless of the value of carbon. POLICY IMPLICATIONS: Separate evaluation of jointly produced ecosystem services, and the focus on particular scales, both lead to error. Understanding the spatial distribution of the costs and benefits of jointly produced services is important to the development of the governance mechanisms and incentive systems needed to induce their optimal provision.
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