Ecosystem Services

Forests provide many goods and services to the residents of New Brunswick. These goods and services include erosion control and sediment retention, raw materials (e.g. timber), recreation, food production, water, air regulation (including cleaning and filtering), climate regulation, water supply, soil formation, and more. These goods and services are provided at no monetary cost to the user, and are often not valued by our economy, even though they have great intrinsic worth. Many of these goods and services are being degraded due to threats to forests, such as urban expansion and development, agricultural clearing, and logging operations. To assess the economic value of what may be lost, some researchers have attempted to calculate the value of these forest goods and services. Although many would argue that these services are irreplaceable, and therefore “invaluable”, it is still useful for comparative purposes to place a value on them. Currently such services are not recognized for their value to people, so that even a monetary figure placed on them is helpful for creating awareness of their value.

Calculations for the non-timber ecosystem services provided of New Brunswick’s Crown forests were based on the calculations of Costanza et al. (1997), who calculated a per-hectare value of the ecosystem services in different biomes (including forests) worldwide, and GPI Atlantic (2001), who calculated values of  ecosystem services for Nova Scotia’s Crown forests. All valuations were based on replacement and contingent valuation estimates (i.e. the cost of replacing these natural functions with man-made ones).

Ecosystem Service (includes goods)  / Total Value for N.B. (2007$millions/year* × total Crown Lands)
Climate regulation / 500.64
Soil formation / 57.45
Waste treatment / 499.85
Biological control / 23.00
Food production /  287.29
Recreation // 206.84
Cultural / 11.49
Total (not including raw materials) / 1586.56
*Monetary value estimates are based on replacement values and contingent valuations. Conversion of USD to CAD is based on the inter-bank rate average for 1994 (1.36581). Source: Costanza et al. 1997.

According to the Atlantic Provinces Economic Council, in 2007 the forestry industry contributed approximately $1.63 billion to the provincial GDP. Of that revenue, 42% came from Crown Lands ($685 million), which is much less than the economic value of ecosystem services ($1.59 billion in 2007). Clearly, from the limited number of ecosystem services that have been valuated, the forest ecosystem on Crown Lands supplies goods and services to the people of New Brunswick that are much more valuable than the revenue generated by the forest industry.

These estimates for the value of ecosystem services are still very conservative because they do not include raw materials (timber), water supply and regulation (watershed protection, soil erosion control, and sedimentation retention), nutrient cycling, gas regulation, disturbance regulation, pollination, habitat, and conservation of pools of genetic diversity. Estimates for some of these services are available in the Costanza et al. (1997) document, and others are not, due to a lack of information. GPI Atlantic (2001) estimates that if these services were included, the total value listed above could double (more than $3 billion in 2007 dollars). Some critics of Costanza et al. (1997) have said that their calculations are a gross underestimate of the value of ecosystem services, perhaps by several orders of magnitude.

Given that forest goods and services are more valuable in monetary terms to the citizens of New Brunswick than the industrial forestry sector, it’s clear that we must give New Brunswick forests adequate weight in the decision-making process. Otherwise human welfare in New Brunswick may continue to suffer as a result, and even decline dramatically in the future.

Relevant reading:
Suzuki, D. & F. Moula. January 14, 2009.  Accounting for nature’s good and services.

Costanza, R., R. d’Arge, R. de Groot, S. Farber, M. Grasso, B. Hannon, K. Limburg, S. Naeem, R.V. O’Neill, J. Paruelo, R.G. Raskin, P. Sutton, & M. van den Belt. 1997. The value of the world’s ecosystem services and natural capital. Nature, 387: 253 – 260.

GPI Atlantic. 2001. The Nova Scotia Genuine Progress Index Forest Accounts Volume I: Indicators of Ecological, Economic & Social Values of Forests in Nova Scotia. Retrieved January 10, 2008 from: http://www.gpiatlantic.org/publications/abstracts/forest-ab1.htm.