IUCN - Holcim partnership Ecosystem Valuation Case study Ripon Quarry in UK. Gerard Bos (Holcim) Sept.2010/BOG/NO IUCN-Holcim EVI.

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1 IUCN - Holcim partnership Ecosystem Valuation Case study Ripon Quarry in UK Gerard Bos (Holcim) 1

2 Outline 1. Relevance of Biodiversity to Cement sector 2. Results of the Ripon case study (UK) Background Methodology Study Results 3. What next at sector level? 4. Questions and Answers 2

3 Consequence of ecosystem change for business Businesses impact on ecosystems and ecosystem services Ecosystem change creates business risks and opportunities Businesses rely and depend on ecosystems and ecosystem services 3

4 The Ecosystem Landscape Quarrying and raw material preparation Clinker production Cement grinding and distribution Our sector has a visible impact on almost ALL ecosystems Holcim Group Support Limited

5 Biodiversity Management to be considered throughout the complete lifecycle Rehabilitation & Biodiversity Management Plan Biodiversity and Social Risk Assessment Quarry / Site Lifecycle Go / No-Go Decision Permits Holcim Group Support Ltd 2009 Environmental & Social Impact Assessment 5 Biodiversity CMS MT mtg.ppt

6 Ecosystem Valuation Initiative -Aggregate Industries UK Road Test

7 EVI Road Test - Background Legally required to restore after quarrying Business concern Access to minerals in sensitive areas Perceived costs of restoration and aftercare on extraction sites Public opinion and corporate reputation Valuation to assess benefits of quarry extension and restoration in North Yorkshire Wetland restoration Establishment of artificial lake 7

8 Objectives of study To investigate the value of restoration to wet meadows vs. reedbed and the distribution of benefits between stakeholders To quantify and value significant change in biodiversity and ecosystem services following mineral extraction on the site To be able to negotiate appropriate levels of restoration and level and duration of aftercare/management costs To value the contribution of the site to additional flood control in the landscape and region To understand the practice of ecosystem valuation in order to anticipate future planning requirements 8

9 Processing plant Exhausted extraction area Proposed reedbed Recreational lake Area of study

10 Methodology valuing ecosystem benefits Biodiversity Willingness to Pay of local population for conversion of agricultural land to wetlands for wildlife habitat ( /household) Recreation- use WTP of individuals for additional boating opportunities ( /household) Flood control average value of avoided damage estimates ( /hectare) Carbon storage estimates of carbon sequestered in newly established wetlands (tons CO 2 e/hectare) * /ton CO 2 e 10

11 Methodology estimating costs Restoration costs Labour, material, survival rates Aftercare costs Based on annual returns from 200,000 fund provided upfront Opportunity costs Value of foregone agricultural and livestock production 11

12 Value of ecosystem service - benefits and costs of supply BENEFIT COST 12

13 Present value of ecosystem service benefits and costs of supply BENEFIT COST 13

14 Aggregate Industries UK Key findings Significant benefits due to wetland restoration and creation of lake ( 1.1m) habitat ( 1.4 million) recreational ( 350,000) flood control ( 224,000) carbon ( 4,700) Costs of restoration and aftercare relatively small and do not affect financial bottom line Compensation for environmental damage can deliver improvements in ES at modest expense Economic gains much greater on marginal land due to low opportunity cost 14

15 Aggregate Industries UK How to use results? Internal audience: To improve decision-making To assess costs of legal liabilities External audience To develop restoration and aftercare plans in application process To ensure future access to minerals by demonstrating net benefits to society and net biodiversity gain for planning restoration based on uses with greatest benefits 15

16 Ecosystem valuation is ONLY a means to an end Placing monetary values on ecosystem services is not an end in itself The aim is to provide information to make better and more informed decisions: - Better meeting targets and goals - Avoiding costs and losses - Maintaining/Increasing revenues - Finding cost-effective means of complying with obligations and managing environmental footprints 16

17 Next steps Broaden access to ESR/CEV: CSI Forum, Warsaw (14 Sept) UEPG workshop, Paris (21 Sept) CBCSD - ESR training, Shanghai (21 Sept) ENI Conference Matera, Italy (24 sept) CDB COP 10 in Nagoya CEV guide will be published Business and Biodiversity Day - Oct 26, 2010 Release of the IUCN-Holcim Biodiversity Management System Q&A 17

18 Thank you 18