March 01, 2016

A New Federal Policy for Ecosystem Services

J.B. Ruhl

Eighteen years ago in an Insights column, I predicted that the “ecosystem services movement in ecology and economics will not easily be turned around” and that it would profoundly shape “the future of environmental law.” J.B. Ruhl, Valuing Nature’s Services: The Future of Environmental Law?, Nat. Resources & Env’t, Summer 1998, at 359. I outlined the emerging theory of ecosystem services and its focus on the economic values humans derive from functioning ecosystems in the form of services rather than commodities, such as water filtration, pollination, flood control, and groundwater recharge. Although indisputably of value, many of these services exhibit public-good qualities, in that there is no market in which owners of the “natural capital” supplying the services can charge the beneficiaries, who basically see the services as free. For example, the owner of riparian wetlands cannot as a practical matter charge for the flood protection benefits property owners enjoy twenty miles downstream. Rising ecological degradation, however, impedes the flow of these services to human populations, at which point people begin to care more about them as the costs of damage to other economic assets mount. The depletion of coastal wetland and dune systems, for example, exposes the coastal built environment to greater flooding risks, and the reduction of groundwater recharge threatens drinking water and agricultural irrigation supplies. Ecologists and economists forging the concept of ecosystem services valuation thus projected it as a way of improving land use and resource development decision making by ensuring that all relevant economic values were being taken into account. It seemed only logical and uncontroversial to me at the time, therefore, that environmental law would fully embrace the ecosystem services concept.

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