Creating a Market for Restored Ecosystems

Market mechanisms to provide for environmental quality are controversial.  The 1990 Clean Air Act, which instated a cap-and-trade system to efficiently decrease acid rain, irked many people, who said that the buying and selling of rights to pollute was morally wrong. However, twenty years later the program is widely heralded as a success. Thus the current interest in cap-and-trade systems for greenhouse gas emissions, such as carbon dioxide. Market mechanisms such as this are expanding beyond just industrial operations and power plants, however.

A recent article by the Christian Science Monitor details a new Department of Agriculture Office, the “Office of Ecosystem Services and Markets.” This office seeks to

engage farmers, woodlot owners, and the federal land management agencies that oversee hundreds of millions of acres of public land – areas with the potential to “capture” considerable amounts of carbon dioxide that would otherwise escape into the atmosphere and accelerate warming of the planet.

How is this related to the work of Wildlands CPR? Simple: restored watersheds have great potential to sequester carbon dioxide. Given the almost complete reliance on local, state, and federal governmental agencies to fund these restoration efforts, implementing market mechanisms would facilitate greatly increased levels of restoration activities. The program will

open a new era in which urban industrial emitters of carbon dioxide will partner with private landowners to plant new forests or crops to soak up CO2, or in which revenues generated from a carbon tax will pay for planting trees in federal forests lost to wildfire.

This possibility creates alliances among people who often otherwise do not see eye-to-eye on environmental issues. For example:

“For the ecosystem service concept to generate real results, it will have to go beyond valuing ecosystem services to actually contracting for them,” says Terry Anderson, executive director of the Property and Environment Research Center in Bozeman, Mont., a free-market economist who advocates resource protection based on economic incentives rather than government regulation.

This program, along with the multitude of other initiatives that seek to create market mechanisms to improve environmental quality, are pivotally important to moving environmental protection forward. Rather than creating a reliance of piecemeal appropriations, they create sustainable mechanisms that stand on their own (For a great review of some other preexisting programs, check out this report from the Puget Sound Partnership). This is not to say that these programs are perfect, or that they are the be-all-end-all for carbon sequestration and ecosystem restoration. However, they are a growing area of where environmental protection is heading, and present many great opportunities to further watershed restoration.