Getting Started with Payments for Ecosystem Services October 2009 Getting Started with Payments for Ecosystem Services United States Forest Service 1 MODULE THREE: Opportunities and Risks for Landowners in PES Transactions

Opportunities/ Risks for Landowners in PES Module 3: Opportunities and Risks for Landowners in PES Transactions Opportunities for Landowners Case Study: Van Eck Forest Carbon Project Case Study: Conservation Banking – The Red-Cockaded Woodpecker Case Study: Water Quality Trading – New York City and the Catskills Risks of PES for Landowners 2

Opportunities for Landowners Short-Term Increased cash income Expanded experience with business activities Increased knowledge of sustainable resource use practices Long-Term Improved resilience of ecosystems Potential for higher land productivity 3

Forest Carbon Case Study: Van Eck Project  First working forest to register for carbon with CCAR in July  2,200-acre redwood forest  Managed by Pacific Forest Trust  Increase CO2 stores, restore biodiversity and timber  500,000 tons of CO2 over next 100 yrs  High-profile buyers  NatSource buys 60k in Feb ($8 - 12?) 4

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Southlands Forest, Bainbridge, GA International Paper (IP), The Environmental Defense Fund, USFWS, Georgia Department of Natural Resources Habitat Conservation Plan expanded woodpecker habitat by 3,500 acres Source: Environmental Defense Fund, 8 Conservation Banking Case Study: -The Red-Cockaded Woodpecker

 Within 5 years - 50 birds, 13 breeding pairs occupied the area  IP earns credits to harvest timber in degraded habitats  Translocation from degraded to maintained habitat - better survival  Contiguous longleaf pine ecosystem 9 Source: Environmental Defense Fund, Conservation Banking Case Study: -The Red- Cockaded Woodpecker

Safe Drinking Water Act: city filters water or demonstrates watershed protection NYC pays upstate landowner to preserve/ enhance watershed Catskill Watershed Corporation implements regional development Communities minimize population growth and provide runoff protection 10 Water Quality Trading Case Study: New York City and the Catskills

Catskill residents earning close to 100 million USD/ yr NYC taxpayers save over 6 billion in avoided costs Better land management, more standing forest, better water quality 11

Risks of PES for Landowners Opportunity costs Potential loss of rights to harvest products Potential loss of employment Possible increased competition for land Performance risk 12