Delivering Environmental Services in Landscapes: Experiences with PES through IUCN’s Livelihoods and Landscapes Strategy

By David Huberman and Gill Shepherd

“Payments for environmental services (PES) have been popularized relatively recently as a form of conservation finance. Its potential is widely debated in academic and policy circles, and its application is being tested in a variety of contexts.

Nevertheless, there still is no clear consensus on what the real potential of PES is. One recurring question concerns the conceptual foundation of PES: what is it that makes it distinctive from other forms of conservation finance, such as subsidies, offsets, or eco-labels? While there have been many efforts to provide robust theoretical frameworks for outlining the different shapes and sizes of PES, its scope is still poorly understood.

At the global level, it is the market for carbon credits that is dominating the PES portfolio through the proliferation of forest-based carbon projects (plantations, restoration, and avoided deforestation). At more localized scales, most examples of PES schemes relate to transactions between downstream beneficiaries and upstream landowners for the sustainable management of watersheds (e.g. payments for erosion control, water filtration and flow regulation). While both forms of PES involve the use of incentives for the regulation of critical natural cycles (i.e. carbon and water), they have little more than that in common.

With the aim of investigating the scope of PES as an ecosystem management tool, this article draws from ongoing work being carried out by IUCN’s Livelihoods and Landscapes Strategy (LLS)  to explore how two different forms of PES (carbon- and water-related) can potentially be combined to strengthen conservation efforts….”