Nature as provider of ecosystem services

How much is nature worth?

$33 trillion according to one study. But is it possible to put a price on nature? Is it immoral to even try? What would be the point of trying to put a cash number against 'services' nature provides? Would such an approach devalue nature, or provide a powerful tool to defend it?

A paper in the journal Nature in 1997 made a seminal attempt to address this issue. The authors argued that the services nature provides contribute significantly to our welfare, and that a cash figure can be put against it. They approached this by looking at the cost of replacing natural services with human made substitutes (while recognising that for many natural services this is impossible), and people's 'willingness to pay' for nature's services. The figure they came up with for the world was $33 trillion, nearly twice the then global GNP.

They admitted this had to be an under estimate, and work has continued to refine it, including an attempt six years later in a paper entitled 'The value of Scotland's ecosystem services and natural capital', to develop the methodology and apply it to one country.

A justification for this monetarisation of nature is that effects on the environment of human activity then become part of the decision making process: at the moment, if it can't be represented on a spreadsheet then it can be ignored. Of course, a danger is that if you find it possible to do it cheaper than nature can, the financial argument to protect nature has been removed.

There will be resistance to including the true environmental cost of products and services in manufactured goods. An immediate effect is that the price of commodities would increase. The corollary of that is that at present commodities are too cheap because they are not including all the environmental costs of production. As Costanza et al put it: "Because ecosystem services are largely outside the market and uncertain, they are too often ignored or undervalued, leading to the error of constructing projects whose social costs far outweigh their benefits".

This is just one of the stories from my environmental talks