Saturday, February 27, 2016

Scientists Calculate Our Debt to the Earth

Researchers in the US have found a way to put a monetary value on the multitude of vital services and assets we rely on nature to provide us cost-free.

Wheat crops on the Kansas High Plains in the US depend on aquifer water. (Image Credit: James Watkins via Flickr) Click to Enlarge.
Perhaps for the first time, scientists have put a direct cash value on the metaphor that conservationists call “natural capital”.

This is, in effect, the money humans don’t have to spend on services that nature supplies for free – such as crop pollination, water purification, and coastal protection by wetlands, sandbanks and reefs.

And one high value transaction supplied gratis by nature is groundwater.  For farmers water in subterranean aquifers represents money in the bank, as groundwater underwrites 40% of world food production.

Eli Fenichel, assistant professor at the Yale School of Forestry and Environmental Studies, and colleagues looked at withdrawals from the Kansas High Plains Aquifer and report in the Proceedings of the National Academy of Sciences that between 1996 and 2005, Kansas lost approximately $110 million a year.

Food production
The losses represented the depletion of the aquifer as farmers withdraw this ultimate natural capital to support food production.  And the total for the decade was $1.1 billion.
But the latest study delivers a relatively sure balance sheet of costs and rewards, profits and losses.

The scientists used economic principles to value traditional assets, and then factored in ecosystem changes and human behavior that might make such assets increase or reduce in value.  This could help governments and business redefine spending on nature conservation as investment.

“The idea that we can actually measure changes in the value of natural capital is really important,” Dr Fenichel says.  “It shows that in places like Kansas, where groundwater is a critically important asset, there is a way to measure and keep tabs on these resources as part of a larger portfolio.

“And in a world where data is more and more available, it should be possible to do this more often.  I think that bodes well for guiding policies aimed at maintaining all of society’s wealth.”

For a business to be sustainable, its reserve capital must not decline with time.  The new approach means that the natural capital represented by groundwater can be turned into a set of figures on a balance sheet.

Read more at Scientists Calculate Our Debt to the Earth

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