PES Policy Brief

Payments for environment services (PES) are one of the most promising tools when it comes to the improved management of natural resources, including forests: it constitutes an incentive and financing mechanism to potentially bridge between the interest of forest owners looking for income streams and the broader society demanding multiple intangible benefits from forests, from recreation to water protection. In practise, however, the devil is in the details: how to make PES schemes work -- from starting them up, to making sure they have the desired impacts?

This is what the PES Form Task in the eco2adapt project is all about. The intention is to share between specialists, policymakers and other key stakeholders in both Europe and China experiences about the best practises on how to best “do PES”. In November 2023, a team from the European Forest Institute (EFI) visited key partners and field sites in China. This also included a keynote speech at the nationally most important Chinese PES event, the 9th Conference on Eco-compensation and Payments for Ecosystem services, held in Zhangye, in the northwestern Gansu Province. In 2024, a European forum was then screening the experiences with market-based instruments (MBI) and PES for European forests.

What policy-relevant knowledge has come out of all these efforts? Sven Wunder from EFI, who has worked with PES design and implementation over the last couple of decades, is leading the PES Forum task. “It was time for us now to synthesize some of our accumulated knowledge about PES -- both how to set these schemes up, and how to make them work”. The EFI PES policy brief thus tries to condense two decades of PES research, implementation -- including the experiences gained the eco2adapt project. “We could only meet this challenge -- to convey holistic yet digestible PES knowledge on a simple two-pager – by illustrating what PES is about, using the classical example of watershed protection”. Some generalizable lessons thus stand out. “PES is definitely not a one-size-fits-all tool, but when the conditions are right, it can be a highly effective policy and management instrument”, Wunder closes.