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Market-based instruments (MBI) to price resource use
have They can, if
set at sufficient rates, make the polluter pay more
explicitly than regulation and put the full cost recovery
principle into effect. Experience shows that environmental
goals may be reached more efficiently with
potential for cost savings – however, actual cost
savings depend on instrument design and implementation
as well as the ecosystem service in question.
Lastly, pricing instruments can generate public
revenues that can be used to finance biodiversityfriendly
policies.
IMPLEMENTATIoN oF ThE
PoLLUTER/USER PAyS PRINCIPLE
Direct regulation and the use of MBIs are both in accordance
with the polluter pays principle but
. MBIs
confront actors with at least part of the environmental
and social costs their actions cause (i.e. costs that
were previously externalised and thus not considered
in private decision-making) and lead to explicit payments.
Tax bills or permit prices are more transparent
and more easily mainstreamed into private accounts
than investments in technical adaptations to comply
with environmental regulations.
Boxes 7.11-7.13 present successful examples of using
different MBIs for specific goals.
Product taxes are important drivers of ecosystem change.
provide an incentive to increase efficiency in fertiliser use for crops and thereby reduce negative externalities.
Application of various schemes saw decreases in product use (and subsequent reduction of levels in soil and
water) of 20-30% in the Netherlands, 11-22% in Finland, 15-20% in Sweden and 15% in Austria. (Ecotec
2001).
In 2002, Ireland introduced a ; customers now pay 33 cents per bag at checkout. Plastic
bag consumption dropped by 80% from 1.2 billion to 230 million bags in the first year, generating tax revenues
(US$ 9.6 million) earmarked for a green fund. The tax also halted a major import as only 21% of plastic bags
were manufactured in Ireland (New york Times, 2 Feb 2008).
Papua New Guinea has significant foreign receipts through exporting crocodile skins, mainly to Japan. To
promote sustainable resource use, provide an important source of funding for control
and monitoring operations by the Department of Conservation (hunt, 1997).
The Eritrean government implemented a series of , including subsidies
to kerosene, promotion of energy-efficient fuel-wood stoves and dismantling of duties on imported solar technology.
The goal was to encourage people to consume less fuelwood, thus addressing deforestation and forest
degradation problems in the country (UNDP 2001).
TEEB FoR NATIoNAL AND INTERNATIoNAL PoLICy MAKERS - ChAPTER 7: PAGE 21