Benefit-Transfer Ecosystem Services Valuation of the Mining Area in Mt. Hamiguitan Ranges and its Environs

Ponce, R. & Tabora, J.

Rationale

Failure to account for the natural ecosystem services in any benefit-cost exercise of an economic activity may undervalue or even neglect the said services to the point of compromising sustainability of humans in the biosphere.

Rationale

Mt. Hamiguitan, a tropical mountain range in Southeastern Philippines is rich in biodiversity and mineral resources. But it is confronted with ecological and economic issues over an approved mining area of significant scale relative to the remaining forest cover of the mountain range (57% of Mt. Hamiguitan area).

Objective

This paper tries to establish information on the value of the Mt. Hamiguitan ecosystem services that maybe reduced or lost when renewable ecosystem services are compromised in favor of extracting non-renewable mineral resources.

Conceptual Framework

Holistic Benefit-Cost

Analysis

Economic Efficiency &

Equity

Economic Value of Ecosystem

ServicesBenefit Transfer

Valuation

BiodiversityResearch

Methodology

This study uses the benefit value approach (Pattanayak, Smith & Van Houtven, 2003) using single point estimates by a synthesis of valuation studies done by Constanza et al in 1997

Uses Constanza et al (1997) estimates of ecosystem services

Methodology

The following steps were undertaken in this benefit value approach:

(2) Identification of existing studies where the benefit has been estimated;

(3) Identification of the resource and relevant values to be applied;

(4) Substitution of the values to calculate benefits; (5) and calculation of the present value.

Limitations

Credibility of Constanza et al (1997) estimates

No information as to the health status of ecosystems when the estimates were derived

Results and Discussions

Table 1 Ecosystem Services

Aesthetic information**RecreationCultural and artistic information**Spiritual and historic information**Science and education**

Information Functions

Food productionRaw materialsGenetic resourcesMedicinal resources*Ornamental resources*

Production Functions

RefugiaNursery

Habitat Functions

Gas regulationClimate regulationDisturbance preventionWater regulationWater supplySoil retentionSoil formationNutrient regulationWaste treatmentPollinationBiological control

Regulation Functions

Ecosystem ServicePrimary Category

Table 2 Summary of global value of annual ecosystem services grouped by primary category as applicable to Mt. Hamiguitan and its environs

8,49820,945

230567

41101

-8,22720,277

Lakes/Rivers

9,99024,624

6581,622

6281548

169417

8,53521,037

Mangroves

244*601

25

67165

-175431

Grass/Rangelands

2,008**4,949

114281

388956

-1,5063,712

Tropical forest

6,076**14,975

3,0097,416

247609

717

2,8136,933

Coral reefs

19,00446,840

-25

-19,00246,835

Seagrass/Algae beds

22,83256,276

4101,011

5461,346

131323

21,74553,596

Estuaries

Total ValueInformation Function

Production Function

Habitat Function

Regulation Function

Average Ecosystem Services per Hectare per Year in 1994 US$ and 2010* US$

Biome

Table 3 Mt.Hamiguitan EcosystemsMajor Biome Approximate Area in the

Approved Mining Permits1 and Environs (Ha)

Sea grasses

137.310

Sea weeds 10.700 Corals 424.170

Coastal

Sandy Floor 316.680 Estuaries 33.000 Mangroves 3.470

Tropical Forest 10,207.335 Closed canopy 5,342.390 Open canopy 4,864.945

Terrestrial

Grasslands 5,681.697 Grasslands 5,598.670 Brushlands 8.079 Bush areas 74.948 Croplands 4,092.104 Tree plantation

and perennial crops 1,243.441

Cultivated area 2,848.663 Lakes & Rivers** 35.020

Total

20,941.488

Table 4 Valuation of Ecosystem Services of Mt. Hamiguitan Mining Area and its Environs by Primary Function in 2010 US$

Major Biome Reg

ula

tion

Func

tion

Pro

duc

tion

Func

tion

Ha

bita

t

Func

tion

Info

rma

tion

Func

tion

Ecosystem

Services

Estimate in

US $

Estuaries

1,768,668

44,418

10,659

33,363

1,857,108

Seagrasses 6,430,914 687 - - 6,431,600

Sea weeds 501,135 54 - - 501,188

Corals 2,940,771 258,320 7,211 3,145,645 6,351,946

Coastal

Mangroves 72,998 5,372 1,447 5,628 95,445

Sandy Floora 16,972,781 426,251 102,288 320,163 17,821,484

Subtotal 33,048,771

Tropical

Forest

37,889,628

9,758,212 10,207b 2,868,261 50,526,308 Terrestrial

Grasslands 2,448,811 937,480 5,682b 28,408 3,420,382

Cropland 380,566 544,250 4,092b - 928,908

Subtotal 54,875,598

Lakes & Rivers 709,695 3,535 35b 19,845 733,110

Total 70,115,966 11,978,578 141,621 6,421,314 88,657,479

Other Studies (Coral Reefs)

US$ 4,238 (Economic Value of Corals, 2008)

US$ 15,118 (Seenprachawong, 2004)

US$ 14, 975 (This Study)

No Estimates

Sandy Floor Crop lands Habitat Function

Seagrass Seaweeds Tropical Forests

Discussion Points

US$ 88.6M/year of the 18,000 hectares is a floor estimate

An underestimate How would it fare to

mining income projection? Tangible value vs

intangible value (incentives approach)

How do we estimate ‘habitat function’?

Conclusion

The total value of ecosystem services of Mt Hamiguitan and its environs, across 21,941 hectares in 2010 US Dollars per year amounts to US$88,657,479.00.

This estimate accounts 79% for regulation function value, 13.5% for production function value, 1% for habitat function value, excluding most of the ecosystem areas, and 7% information function value.

Conclusion

This value can be set as the minimum value of Mt. Hamiguitan ecosystem services.

This value represents the ‘forgone’ or ‘reduced’ benefits once mining activities are in full operation.

It is the regulation function of the ecosystem services which will be directly affected once mining operations are made.

Conclusion

These values are underestimates since some ecosystem are not valued including the infrastructure value of the entire ecosystem.

The habitat function being the least valued need further study specially on the values of endemic and rare species.

Conclusion

These values can serve a basis for studying the possible loss or reduction made on the ecosystem once compromised.

These could also represent the minimum replacement value if the ecosystem services lost be reconstructed or restored once damaged

Recommendations

Estimate habitat function value using proxy secondary data on existing conservation cost of rare and endangered species. (e.g. Philippine eagle, tarsier & butterflies)

Update calculation of estimate on crop lands. Need of robust biophysical data as estimation basis Possible Journal Publication (Asian Journal of

Biodiversity)

Thank You