This Week In Water: Putting Together The Pieces For Watershed Payments In Kenya

Ecosystem Marketplace will be hosting a webinar this month on the most up to date financing mechanisms for watershed conservation. Not long after, in May, the Katoomba Group will hold their 18th meeting in Beijing, China to investigate nature-based solutions to the water crisis. Meanwhile, Ecosystem Marketplace is running a story series that explores a watershed payment program in Kenya’s Lake Naivasha Watershed. 

Ecosystem Marketplace will be hosting a webinar this month on the most up to date financing mechanisms for watershed conservation. Not long after, in May, the Katoomba Group will hold their 18th meeting in Beijing, China to investigate nature-based solutions to the water crisis. Meanwhile, Ecosystem Marketplace is running a story series that explores a watershed payment program in Kenya’s Lake Naivasha Watershed.

This article was originally published in the Water Log newsletter. Click here to read the original.

21 March 2013 | Greetings! It’s been a busy month for us (though maybe we say that every month).

In early March, we launched our new Spanish-language sister site to the Ecosystem Marketplace, Valorando Naturaleza. Some of the world’s most innovative environmental financing mechanisms are coming out of Latin America, but coverage of these programs is often hard to come by, even within the region. To fix that, Valorando Naturaleza will act both as a regional hub for news and information and a conduit between the Spanish and English-speaking worlds. We invite you to take a look or forward to a colleague, and let us know what you think!

Ecosystem Marketplace’s Kate Hamilton and Genevieve Bennett will also be participating in a webinar on March 24th, hosted by the Yale Center for Business and the Environment, to discuss the latest and greatest in financing mechanisms for watershed conservation and restoration around the world. You can register for the webinar here.

And finally, mark your calendars for Katoomba XVIII: Forests, Water, and People, to be held in Beijing, China on May 16th. Continuing the tradition of 17 previous international Katoomba meetings, Forests, Water, and People will gather leading experts, practitioners, policymakers, and investors from China and abroad to advance nature-based solutions to the water crisis for an urbanizing world.

It looks like you all have been busy as well – this month’s newsletter spans the watershed investments world – from water restoration certificates and bundled carbon and water credits to the next generation in design and engineering for a world of rising seas and frequent floods. We also want to draw attention to our ongoing series on the Lake Naivasha watershed payment program in Kenya, where flower-growers, hoteliers, and others are compensating upstream landowners to reduce sedimentation. We take a close look at the whole process: what it takes to develop and implement a project like this.


Happy reading!


— The Ecosystem Marketplace Team

For questions or comments, please contact [email protected]

EM Headlines


Tying The Knot: Buyers And Sellers In Kenyan PWS


It’s almost a year since that day in May, 2012, when Abigael Tamooh drove James Waweru to the steep slopes of Kenya’s Abardares Hills. “We wanted to show him directly how the payments for watershed services (PWS) were changing farmers’ behavior,” she says. “Because that’s the only way we’re going to get buy-in.”

Waweru runs the Flower Business Park Management Ltd., which coordinates activities of several flower-growers along the lake’s shore. He says he was sold within ten minutes of getting out of the car. “The difference between those who subscribed to PWS and those who didn’t was quite apparent,” he says. “But then I had to convince our board as well.”


Entering into a payments for watershed services program is more akin to getting married than it is to buying a normal product, and participants often face an array of hopes and fears at the outset. Ecosystem Marketplace has an exclusive look at how deep-pocketed flower-growers along the shore of Kenya’s Lake Naivasha and subsistence farmers in the hills 40 kilometers away finally tied the knot – and what it means for similar transactions around the world.


Keep reading at Ecosystem Marketplace.

Stacking And Unstacking: The Conservation And The Conversation


Common sense would dictate that properties generating the greatest environmental benefit should also command the highest price in the ecosystem marketplace, and that one way to do that might be to let people stack different ecosystem values on the same patch of land.


Attempts to implement this idea, however, often bog down on technicalities and charges that the user is trying to double-dip rather than earn fair compensation for ecosystem services delivered. This is unfortunate, because we now have enough real-world examples to launch a real-world discussion about stacking and unstacking – as well as about whether the entire system needs to be reformed and rethought.


Wayne White of mitigation banking group Wildlands, Inc, and Jemma Peneloped of W2Consulting recently launched that discussion in an article in the National Wetlands Newsletter. We asked White to recap some of the issues they explored in that piece.


Keep reading here.

PWS In Kenya: How WWF And CARE Found Common Ground In High Hills


Chege Mwangi’s teardrop-shaped farm hangs on the high slopes of Kenya’s Abardares Hills like a tattered green curtain. Though listed as three-quarters of an acre in size, Mwangi figures it’s closer to a full acre. “They surveyed it from the sky,” he says. “That means they didn’t take into account the slope.”


And that slope is a doozy: its 35-degree incline sends water sloshing down into the Terasha River, much of which ultimately reaches Lake Naivasha 25 miles to the north. For years, Mwangi watched helplessly as the rain washed bits of his farm down into the river. He knew that he was watching his family’s future dribble away with it, but he didn’t know what to do. Meanwhile, down in the lake, flower-growers were noticing things as well. Sedimentation was gunking up the lines for their greenhouses, and water hyacinths had blanketed parts of the lake, killing the fish below.


“It all fits together,” says Peter Muigai, a community mobilization officer for WWF. “For Naivasha to exist, the rivers from this side of the catchment have to flow, and increasingly, they don’t.” He’s working with farmers in these hills on an ambitious Payments for Watershed Services project that aims to tap the wealth of Lake Naivasha flower-growers – as well as geothermal providers and hotels – to help upstream farmers like Mwangi implement sustainable agriculture practices. If the plan works, it will reshape the landscape across Lake Naivasha’s 3400-square-kilometer catchment and preserve an economy that employs hundreds of thousands of people. If it fails, there’s little hope that those who live off the lake can continue to do so.


Get the full story.

Kenyan Flower-Growers Use Watershed Payments To Save Their Lake And Their Livelihoods


A giraffe munches nonchalantly on acacia leaves as a family of zebras dashes past him, lumbers up an embankment, and quickly zips across the road leading to Elsamere, where Joy and George Adamson rescued and raised Elsa the lioness in the 1950s. This is the Kenya of postcards and travelogues – of open vistas, Maasai herdsmen, and – increasingly – greenhouses, which have taken over the flatlands surrounding Lake Naivasha.


Some of the greenhouses are used for growing tomatoes and other vegetables, but the overwhelming majority are full of flowers – mostly roses – that will be sold in European flower shops within a day or two of being cut. The greenhouses rely on regular flows of clean water – as do the geothermal power stations in nearby Hell’s Gate National park, where the Kenya Electricity Generating Company (KenGen) is spending Sh98.6 billion ($1.314 billion) on a new 280-megawatt geothermal power plant. The facility needs the lake because the lake feeds subterranean waterways that provide the steam that will turn the plant’s turbines. Hotels along the edge of the lake need the lake, too – for it’s the lake that brings tourists here on their way to and from the Maasai-Mara National Park.


And that’s why the lovely green prairie beyond the greenhouses is an ominous site. It’s not solid land; it’s Lake Naivasha itself. What looks like prairie is actually a carpet of water hyacinth that’s choking the lake, and it’s being fed by tons of fertilizer washing down from the hills above. Without quick action, the lake – and the economy that depends on it – will be a thing of the past.


Learn more here.

In The News


Murray-Darling Basin Plan Crosses The Finish Line to Find a New Row of Hurdles

Mark Twain (allegedly) said it best: “Whiskey is for drinking, and water is for fighting.” Those who thought that the Murray-Darling Basin water management plan’s finally being signed into law might signal the end of years of heated debate are in for disappointment. The New South Wales state government recently announced that it would limit instream buybacks by the federal government, while the state of South Australia has cut its promised contribution to buybacks by US $14.6 million.


Critics of the plan say that buybacks will cripple rural economies and that money is better spent on irrigation infrastructure improvements to boost efficiency. NSW minister of primary industries Katrina Hodgkinson told the Australian Broadcasting Company that she considered buybacks “the simplest and most convenient — and possibly the laziest — option for the government.” Federal government officials aren’t mincing their words either – a federal spokesman called South Australia’s premier a “complete and utter hypocrite.” Despite all of the name-calling, the plan’s moving forward, with $1.7 billion in federal funds slated for buybacks, infrastructure, and improved management.

Keep reading at Circle of Blue.

75% of Asia-Pacific Countries Threatened By Water Insecurity

Three out of four countries in Asia and the Pacific face serious water insecurity, according to a study released this month by the Asian Development Bank (ADB) and Asia-Pacific Water Forum (APWF). Asian Water Development Outlook 2013 tracks water security in 49 countries from household to national scales, finding that rivers are under tremendous strain in South Asia and parts of West and Central Asia. Meanwhile, lack of access to water and sanitation and vulnerability to natural disasters are major challenges facing many Pacific islands. The authors recommend prioritizing integrated water resources management, restoring rivers and managing groundwater, and investing in water infrastructure and sanitation. “While the Asia-Pacific region has become an economic powerhouse, it is alarming that no developing country in the region can be considered ‘water-secure’,” said Bindu Lohani, ADB’s Vice President for Knowledge Management and Sustainable Development, in a press release.

Read a press release.
Read the report.


In the Netherlands, Next-Generation Planners and Engineers Working With, Rather Than Against, Nature


Hurricane Sandy was a wakeup call for more than a few public officials in the coastal areas of the United States, and unsurprisingly, many have looked to the Netherlands for strategies for keeping floodwaters at bay. And they’re finding that the Dutch, armed with centuries of experience and evidence that seas and rivers are already rising as the climate changes, are beginning to shift their approach. Rather than try to keep floodwaters at bay, they’re learning to live with nature. “In lieu of flood control the new philosophy in the Netherlands is controlled flooding,” writes Michael Kimmelman

for the New York Times.


That means to some extent requiring people to relocate from high-risk areas. But it also means learning to accommodate nature in the urban landscape: “The local buzzword is ‘multifunctional,'” writes Kimmelman. “The Dutch are putting retail and offices on top of new dikes, designing public squares and garages to double as catch basins for rain and floodwater, constructing floating houses and reservoirs that create recreational opportunities.”


A similar revolution is taking place in hydraulic engineering, as Yale 360 reports. On the south-central coast, 28 million cubic yards of sediment have been mounded on the beach, to be redistributed by ocean currents into a 12-mile buffer to protect the coastline from storm surges and replenish eroding beaches. Others are designing hybrid dikes planted with vegetation to better trap sediment and stand up to poundings by storms, or replacing dikes altogether with sand dunes. “If I make a [concrete] dike, and conditions change, I have to re-do the whole dike,” explains Jasper Fiselier, an environmental planner with Royal HaskoningDHV and a project leader with the Building with Nature consortium. “Whereas with a soft defense, I only have to put a half-meter [of earth] on top.”


Read more at the New York Times.
Read the Yale 360 article.

Benchmarking Business Activity on Ecosystem Services


A new report from BSR offers a wide-ranging snapshot of current business engagement with ecosystem services around the world. Based on company communications and reporting, Private Sector Uptake of Ecosystem Services Concepts and Frameworks tracks a range of work on ecosystem services – from ‘no net loss’ policies to natural capital accounting to decisions about the supply chain or project siting. Some findings are positive: thirty-five companies now discuss ecosystem services in their corporate communications, while the oil & gas, mining, chemicals, entertainment and tourism industries all have relatively well-developed business cases for understanding and managing ecosystem services. Still, many companies, lacking tools and guidance, are unsure how to move from concept to action, and important lessons, data, and approaches are not being widely shared or independently analyzed.


Learn more.
Read the report (pdf).

NatLab Initiative Offers Guidance on Attracting Private Finance to Green Infrastructure


Municipal and state governments could potentially channel billions in private investment into urban stormwater controls and system upgrades, according to a pair of new reports from NatLab, a new partnership between The Nature Conservancy, the Natural Resources Defense Council and EKO Asset Management Partners. Creating Clean Water Cash Flows and Greening Vacant Lots outline strategies – largely drawn on lessons from energy efficiency finance – for attracting private investment in green infrastructure. Many of these tactics are already being deployed in Philadelphia, where the “Green City, Clean Waters” program has already demonstrated success in stimulating private finance. “Harnessing natural infrastructure in the transition from gray to green is of enormous interest to investors, including family offices, foundations, endowments, pension funds and other large institutional investors,” said Eron Bloomgarden, partner at EKO Asset Management Partners, in a press release.


Learn more here.

When the Insurance Companies are Botching Risk Management – Well, Heck


A new report from Ceres presents findings from a climate risk disclosure survey of insurance companies which was developed by the National Association of Insurance Commissioners. Findings are a little worrying: nearly all of the respondents showed “significant weakness in their preparedness” to climate change impacts on their business, though large firms or those in the Property & Casualty (who deal with a lot of weather events) business on the whole tend to be better prepared. Only one out of eight had a comprehensive climate change strategy. Insurers also by and large aren’t really talking to policy-makers or regulators about climate change, limiting their potential influence on the public conversation about preparing for climate change. Not surprisingly, Ceres recommends that insurance companies think about climate change and risk exposure far more strategically, while improving their own public disclosure and stepping up as a vital participant in informing public policy.


Read the report.

Silk Pledges to Offset Water Use – Its Own and Yours, Too

Silk, a soy, almond and coconut milk brand, has signed on as the first charter corporate sponsor for Change the Course – a new initiative that encourages the public to calculate and reduce their water footprints in the Colorado River Basin. For every individual pledge, Silk will support the restoration of 1,000 gallons of water to the river system. Silk also has committed to offsetting 50% of its own manufacturing water footprint via purchasing Water Restoration Certificates from the Bonneville Environmental Foundation.

Read a press release.

Clear Water Carbon Fund Plants New Seeds


The Clear Water Carbon Fund (CWCF) has announced that it will be expanding its operations to a new site in Maine’s Androscoggin River and Vermont’s Upper Clyde River watershed. CWCF develops credits for the voluntary carbon market that also offer water and biodiversity co-benefits, through riparian plantings that improve water quality and provide fish and wildlife habitat. In the Androscoggin, Central Maine Power will be the buyer, and is reportedly motivated in large part by CWCF plantings’ potential to cool water (via riparian shade). The new projects will bring CWCF activities to a total of five watersheds.


Read a press release.


World Water Day


World Water Day is organized in Geneva on the United Nations’ World Water Day held on March 22nd each year. Steve Zwick, managing editor of Ecosystem Marketplace, will be moderating the closing debate. Who Should Attend? Decision makers in Banks, Insurance companies, Family Offices, Trading companies, Defense companies, Water technology and service providers, Pension funds, Real Estate investors, Supervision companies, Private Equity Managers, advisors in philanthropy and other market makers. Knowledge is the best defence and tool for food/energy/commodities prices water nexus and water procurement security. This event is a unique opportunity to access strategic water interdependencies information to measure, manage and anticipate water risks and impact investing opportunities. 22 March 2013. Geneva, Switzerland.


Learn more here.

Wildfire Readiness and Response Workshop


Sponsored by Water Research Foundation with support by USEPA Source Water Protection Program and Urban Waters Federal Partnership, this workshop will guide participants in evaluating the potential for wildfire in specific source water protection areas, understanding the impacts of wildfire on water quality, and identifying and characterizing strategies that are effective for mitigating or minimizing wildfire impacts. Case studies will be provided of inter-municipal cooperation and management strategies and funding mechanisms among water utilities and other governmental agencies (e.g., U.S. Forest Service) and NGOs in addressing wildfires and their impacts on the drinking water industry. 4-5 April, 2013. Denver CO, USA.


Learn more here.

AWWA Sustainable Water Management Conference


Presenting solutions for balancing the benefits of conservation with the costs, managing infrastructure, developing robust supply models and watershed management plans, water reuse, resource management, green infrastructure and more. Throughout the four-day event, which features two Sunday pre-conference workshops, 28 technical sessions and one interactive poster session, participants will learn the benefits of sustainability panning and how it leads to cohesive communities and utility systems optimization. 7-10 April, 2013. Nashville TN, USA.


Learn more here.

2013 NGWA Summit — The National and International Conference on Groundwater


Groundwater is a resource to be protected. It ignores political boundaries, transports contaminants, floods mine and construction sites, spins communities into an uproar, and can’t be found when you need it. Model, explore, characterize, bank, inject, extract, treat, and predict all your subsurface needs with everything groundwater at the 2013 NGWA ® Summit. 28 April – 2 May, 2013. San Antonio TX, USA.


Learn more here.

2013 National Mitigation & Ecosystem Banking Conference


The only national conference that brings together key players in this industry, and offers quality hands-on sessions and important regulatory updates. Learn from & network with the 400+ attendees the conference draws, offering perspectives from bankers, regulators, and users. 7-10 May, 2013. New Orleans LA, USA.


Learn more here.

Katoomba XVIII: Forests, Water, and People


Continuing the tradition of 17 previous international Katoomba meetings, Forests, Water, and People will gather leading experts, practitioners, policymakers, and investors from China and abroad to advance nature-based solutions to the water crisis for an urbanizing world.

Water resources are increasingly jeopardized by climate change, pollution, watershed degradation, and misuse, with 80 percent of the world now facing significant threats to water security. The challenge is particularly severe in China, where one in seven people lacks access to drinking water that meets national standards. The scale of this challenge requires creative solutions that go beyond conventional approaches. Recognizing the critical role of healthy watersheds, governments, businesses, and civil society organizations around the world have begun to engage the communities of these watersheds in compensation- and incentive-based programs to support watershed stewardship. In addition to protecting and restoring the natural water infrastructure upon which society depends, these investments in watershed services (IWS) programs can achieve returns on social capital, rural development, carbon sequestration, and biodiversity.


Forest Trends has tracked steady growth in IWS over recent years, with nature-based solutions to urban water insecurity, like the source water protection programs demonstrated in New York City and Beijing, an important part of this trend. China has been a leader in the field, accounting for over $7.4 billion in watershed investments in 2011. The potential for scale in investments in watershed services is great, but can only be achieved through innovation in policy, business, and program design. Katoomba XVIII will bring together actors from all sectors to galvanize learning, share experiences, and catalyze innovation for forests, water, and people. 16 May 2013. Beijing, China.



Learn more here.

Webinar: Financing Mechanisms for Watershed Payments


Please join us for a special edition of the webinar series, “Nature’s Returns: Investing in Ecosystem Services”, coordinated by the Yale Center for Business and the Environment. Featured speakers Genevieve Bennett and Katherine Hamilton from Forest Trends’ Ecosystem Marketplace will discuss results from their recent report, ‘Charting New Waters: The State of Watershed Payments 2012’, on international investments in watershed services. Specifically, Kate and Genevieve will provide an overview of market size, scale, and scope, and highlight established and emerging evolving models for investing in watershed conservation and restoration. 26 March 2013, 1:30 PM EST. Online.


Register here.


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