Rewards for Environmental Services (RES)
By Delia Catacutan and Sara Namirembe of the World Agroforestry Centre (ICRAF)
A big thank you to Delia and Sara who visited IFAD and updated us on groundbreaking research supported by IFAD grant resources... they have boiled down the main messages for you here:
With work in RUPES in Asia and PRESA in Africa, there is evidence/proof of concept that well-targeted agroforestry practices by small-scale farmers can deliver quantifiable Environmental Services (ES) beyond the farm plot that can make a strong business case for private sector engagement. For example, management of the watershed of Sasumua dam smallholders in Kenya has the potential for making a strong business case for Nairobi Water and Sewerage Cooperation, which supplies 20% of Nairobi City water. Negotiated Rewards for Environmental Services (RES) agreements can result in net positive gains for smallholder farmers if the extra effort and costs involved in the delivery of such services is recognized and rewarded. Recurrent payments/rewards are needed for the continuous supply of these services.
The structuring of RES mechanisms may take time, it’s challenging but it can work through the use of appraisal and negotiation tools, which have been developed through ICRAF’s RES research. The learning curve of RES providers and beneficiaries can be steep requiring a negotiated shared understanding. For example, in Indonesia, it took time to generate the evidence as a basis for the communities of Sumbajaya and the Hydro Electric power plant (HEP) to develop and implement a RES contract.
In Asia the challenge is not in group formation, nor the absence of supportive policy frameworks, nor the lack of interest in the business sector, but in coordinating these players, and this requires extra cost. Tremendous improvement in sustainable delivery of ES is likely to be achieved if this coordination is invested in. In Africa market and business capacity is quite weak, however RES is still possible through a more widened reward scheme or approaches that have a more generalized performance measurement.
Rewards can come in various forms for small-holder farmers, the most preferred being the non-financial approach. This presents a challenge in ensuring conditionality. However unlike the business as usual situation, these negotiated contract based approaches can ensure performance. So far the rewards have been in form of cash payments although in conjoint analysis (community consultations) non-financial rewards are preferred.
In many cases national policy frameworks are supportive of RES, but inadequate, with gaps, e.g in enforcement. Having generated this evidence focusing on high potential areas, there is potential in RES making significant difference in low potential areas (drylands). RES can further supplement/be built into food security initiatives for achieving environmental co-benefits.
IFAD has provided grants of US$1million to PRESA and a total of US$2.9 million to RUPES Phases I & II. ICRAF grant team researchers work with IFAD project teams in Vietnam, Indonesia, Philippines, Nepal, Kenya, Uganda and elsewhere.