SOAS Research Online

Abstract

Over abstraction of water and its pollution, and thus the protection of water resources in terms of quantity and quality, are linked and sustained problems that require new solutions. They are dynamic challenges that evolve over time as both outcomes and society’s preferences are driven by economic development and by environmental and social change. An innovative and relatively underdeveloped policy mechanism to address these issues is provided by Payments for Ecosystems Services (PES) schemes. PES schemes are an example of a new and more direct conservation paradigm that explicitly recognises the need to align the interests of landowners and other groups in society that benefit from environmental public goods. PES schemes are based on voluntary transactions in which a defined environmental service (often a land use providing this service) is paid for by one or more service buyer(s) from one of more service provider(s), with commitment to continuous provision of that service. PES develops mechanisms to capture environmental externalities and bring them into the marketplace, based on the principles that the beneficiaries of environmental services pay for their provision and the providers are paid for this. This can provide a mechanism to parallel the regulatory “polluter pays” mechanism with a complementary and voluntary “provider is paid” mechanism. Arguably collective action is not an essential requirement for PES in so far as a PES arrangement could involve a one-to-one transaction between two independent actors; for example, an upstream landowner and a downstream water user such as a factory. A key premise that emerges from this case, however, is that the development and implementation of a PES scheme for water resource protection requires collective action in the form of networks, partnership working and creative knowledge exchange. Social capital and trust between the parties involved, and particularly on the part of an intermediary, can be expected to reduce transaction costs, help resolve conflicts and enhance sustainability.