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COPI aims at providing the European Commission with an assessment of the costs of policy inaction at the global scale with regard to the 2010 biodiversity target. The costs of policy inaction refer to the environmental impacts caused by biodiversity loss, including economic and social impacts on human wellbeing. The study analyses the expected changes in biodiversity levels and in the associated ecosystem services. Final results are presented in terms of monetary and non-monetary costs and risks, taking into account the geographical, social and economic distributions of the impacts.

COPI aims at estimating the environmental damage occurring in the absence of additional policy and in case of failure to correct misguided policies in other areas. The objective is to assess the losses in biodiversity if no action is taken, focusing on marginal analysis, in order to highlight the need for specific policy instruments.

The main objectives of the study are:

  • to develop projections of changes in ecosystem services based on changes in land use and biodiversity in different biomes and world regions over the period 2000-2050;
  • to develop a database of values to be applied to the changes in ecosystem services;
  • to develop a spreadsheet model allowing for different combination of values and land use changes;
  • to match the analysis of benefits and losses across biomes.

FEEM has been involved in the economic valuation of forest ecosystem services, in order to develop a methodological approach and provide a monetary assessment of a selected set of relevant forest services: provisioning, regulating (carbon sequestration) and cultural services (recreation and passive use) associated with different forest biomes in different world regions.

The project is co-ordinated by ALTERRA (Dr. Leon Braat).

The results show that the economic impacts of biodiversity loss are potentially high and significant. The expected economic loss in ecosystem services is around 1% of world GDP in 2010 due to biodiversity loss between 2000 and 2010, and around 7% of world GDP in 2050 due to biodiversity loss between 2000 and 2050.

As regards FEEM contribution, final results reveal that marginal values are higher for provisioning and carbon sequestration services, compared to cultural services, the latter being based on willingness to pay estimates subject to individual budget constraint.

COPI is part of the European commission’s commitment to “strengthen understanding and communication of values of natural capital and of ecosystem services, and the taking into account of these values in the policy framework, expand incentives for people to safeguard biodiversity”.

This study aims to develop an “exhaustive” inventory of the economic valuation of biodiversity and to illustrate the impacts of not meeting the 2010 biodiversity targets. COPI represents a very challenging task for research as most of the already existing studies about costs and benefits refer to planned interventions, while the costs of policy inaction have been absent from many important decision making processes.

The analysis is based on the Millennium Ecosystem Assessment (MA) which has created a conceptual framework for valuing biodiversity, based on the link between biodiversity loss and the decrease in the provision of ecosystem services, with potential negative impacts on the society well being. The impacts are presented under three perspectives: qualitative (biomes, ecosystem services and economic sectors affected), quantitative (physical indicators) and monetary aspects.

COPI can help decision-making process at local, regional and national levels to improve planning and set up specific policy priorities for biodiversity conservation in the EU.

FEEM is mainly involved in the methodological approach to estimate marginal values for some selected ecosystem services for the forest biomes (WP3) and in the development of the valuation database for defining a representative sample of case studies for the forest biomes (WP4). FEEM provides also some inputs in the COPI analysis and synthesis (WP9) for combining information of the valuation database with the area database.

FEEM has developed ad hoc value transfer protocols providing a methodological contribution to the economic valuation of forest ecosystem services, and accurate per hectare estimates of economic values. The analysis is focused on a selected set of relevant forest ecosystem services identified following the Millennium Ecosystem Assessment taxonomy (MEA, 2005): provisioning (wood and non-wood forest products), regulating (carbon sequestration) and cultural services (recreation and passive use).

For the valuation exercise, both market and non-market methodologies have been applied to draw suitable marginal values for the forest services, to be scaled up at the global level using meta-analysis and value-transfer protocols for geographical and inter-temporal transfer.