This article was originally published on Impact Alpha


“Environmentalists have talked for decades about the value of the clean air, clean water, biodiversity and other “services” provided by nature. Now comes the fullest accounting to date of actual transactions that pay for such services.

The headline number: between $36 billion and $42 billion per year, in more than 550 “payment for ecosystem services” programs worldwide, according to the compendium, published (paywall) in the peer-reviewed journal Nature Sustainability.

“These markets are growing,” James Salzman, the professor at both the UCLA School of Law and UC Santa Barbara who led the study, said in an interview. “This is still a relatively young approach. It hasn’t grown as fast as some boosters had hoped. But this is real money.”

The notion behind payments for ecosystem services is to create incentives for landholders to manage their property to ensure the water supply, flood control, carbon capture, wildlife habitat and other natural “services.” In economic terms, the payments “internalize the positive externalities generated by natural systems,” according to the paper…”

Read on at: Impact Alpha.