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e.g. to set the rates or number
of permits necessary to address the loss of ecosystems
and biodiversity.
Understanding the costs of loss can
. valuation provides facts and
evidence of ongoing damage and sheds light on
negative effects of current consumption patterns.
These cost calculations can greatly help policy makers
to establish instruments to make the user pay, as they
justify the need for price-based approaches and
support awareness raising.
Such information can also
for capturing the values of public
goods. To implement full cost recovery approaches to
cover associated environmental costs, the full costs
obviously need to be known. Economic assessments
will thus need to play an increasingly important role in
e.g. future water pricing policies.
Economic information can
e.g. for fees, charges and
trading rules to enable markets for tradable permits to
run properly. A good example can be found in India,
where the Supreme Court used the results of an economic
valuation study to set mandatory compensation
payments for conversion of forested land to other uses
(see Box 7.16: this case study is also cited in Chapter 4).
In 2006 the Indian Supreme Court set compensation rates for conversion of different types of forested land to
non-forest use, with much higher damage assessment multiples (5x for sanctuaries, 10x for national parks) for
any conversion of such biodiversity-rich protected areas. It drew on an economic valuation study of Indian forests
by the Green Indian States Trust (GIST 2006) which estimated the value for six different classes of forests (see
table below) of timber, fuelwood, non-timber forest products and ecotourism, bio-prospecting, ecological services
of forests and non-use values for the conservation of some charismatic species, such as Royal Bengal tiger or
the Asian lion. Converters pay compensation to an afforestation fund to improve national forest cover. In 2009
the Supreme Court directed Rs. 10 billion (~ US$ 215 million) to be released from the fund every year towards
afforestation, wildlife conservation and creating rural jobs (Thaindian News, 10 July 2009).
I
II
III
Iv
v
vI
Tropical Wet Ever- and Semi Evergreen;
Tropical Moist Deciduous
Littoral and Swamp
Tropical Dry Deciduous
Tropical Thorn and Tropical Dry Evergreen
Sub-Tropical Broad Leaved hill, Sub-Tropical
Pine and Sub-Tropical Dry Evergreen
Montane Wet Temperate, himalayan Moist and
Dry Temperate, Sub Alpine, Moist and Dry Alpine Scrub
22,370
22,370
19,000
13,400
20,100
21,300
20,100
20,100
17,200
12,100
18,100
19,200
All values per ha, transformed to US$ and rounded.
TEEB FoR NATIoNAL AND INTERNATIoNAL PoLICy MAKERS - ChAPTER 7: PAGE 27
15,700
15,700
13,400
9,400
14,100
15,000