7th Drop: Payments for Ecosystem Services in Tanzania, Operational & Sustainable?

~ HELLO!! Hope everyone had a productive reading week :) Back to school and back to weekly posts :p

Development of Payments for Ecosystem Services (PES) Schemes?

We talked about the "Working for Water" PES scheme in South Africa previously and covered how the scheme achieved both societal and environmental objectives. This PES scheme has been a long running initiative and thus most articles have been focusing on assessing the impacts/ results that the scheme has had. I have chosen this article today, which also talks about a PES scheme based on water resources within Africa, because of its specific focus on the progress made and future challenges of a newly initiated PES scheme. Hopefully through this case study, we can have a better understanding of the challenges in piloting and developing a sustainable PES scheme within the African context.

Payments for Water Ecosystem Services in Uluguru Mountains, Tanzania

Uluguru Mountains is of key hydrological importance to cities such as Dar es Salaam because water flows from tropical cloud forests of the mountains form the major catchment to the Ruvu River and is estimated to provide substantial amounts of environmental services (HEP, drinking water, water for industrial and agricultural uses) to downstream users. However these forests are increasingly threatened by land-use changes and poor land-use management, critically affecting both quantity of dry season water flow and quality of water flow in Ruvu River.

A pilot watershed PES scheme in Uluguru Mountains, Tanzania has been initiated by CARE-WWF since 2005. The Equitable Payment for Watershed Services (EPWS) project has undergone 2 phases of development. The first phase consisted of a feasibility assessment to establish baseline understanding of the environment and societal contexts, which eventually helped in the formulation of an outline business case and signing of memorandum of understanding with potential service buyers. The second phase was the actual implementation of the water PES scheme on a pilot scale, involving 4 local communities in Uluguru Mountains and 2 downstream buyers in Dar es Salaam. Specifically the EPWS project aims to link upstream rural 'service providers' with downstream urban 'water users' through financial payments to encourage proper land use management and prevent further degradation of forests habitats within Uluguru Mountains. Lopa et al. (2012) explores the lessons learnt from the second phase of the project and also the potential of expanding the pilot project to a larger scale.

Here are some reflections that I had:

1) An operational scheme? Link between land-use changes and improvements in water resource

• Progress made by the project;  feasibility assessment, formulation of business case, signing of memorandum with 2 major water users (Dar es Salaam Water Co. and Coca Cola Kwanza Ltd.) and large enrollment of farmers from 4 local communities!
• Indication of a fairly operational scheme: users agree to pay farmers based on improvements made to their land management practices
• Engel et al. (2008) highlights that supply of environmental services by PES project depends on: (1) enrolment; (2) conditionality; (3) additionality; and (4) land use-servcie linkages
• However currently there is still no direct link between land-use changes and improvements in water quantity/ quality!
• No significant change in water quality observed yet! (NB. scale of project too small to have significant impact on water quality)
• Initial funding were donations by international organisations and grants made by users
• If link between land-use changes and improvements in water resource unclear, unlikely for scheme to be operational in long term? Not really a PES, merely donations for conservation...
• Users have little motivation to pay if no improvements observed?
• If payments cease for farmers, little incentive for proper land-use management? Revert back...

> While legally and theoretically the EPWS project has established a fairly operational scheme where clear cut conditions for payments for ecosystem services are laid out, as of now there is still no clear cut land use-service linkages. This will seriously undermine the operations of the project as users will have little impetus to carry on future payments if there is no clear improvements in the ecosystem services.

2) Sustainability of scheme? Expansion of pilot project to a larger scale and progress into 3rd phase

• Rapidly increasing enrollment of farmers, huge positive for the project
• Achieved equitable outcomes in rural areas, improvements to incomes of participating farmers and investments (towards more profitable commercial agriculture) made by farmers for even greater improvements to livelihoods
• But equitable outcomes for urban poor downstream unclear? Urban poor (no access to water mains) unlikely to benefit from cheaper water tariffs and resource provided by Dar es Salaam Water Co. even if there is cost savings
• Nonetheless clear incentive to stop further degradation of forests
• Hence understandable push towards expanding the pilot project and phase 3
• But point (1) on lack of land use-service linkages also serve to undermine sustainability
• Clear establishment of land use-service linkages must be eventually made to justify the project (especially for users to continue funding payments)
• Moving towards more community-based management as foreign donors exit project...
• Positive because removes bureaucracies in terms of having a middleman + better understanding of local contexts and needs 
• But require proper capacity building of local communities to allow them to undertake negotiations and management of payment schemes in the future
• As well as proper monitoring and compliance strategies to be undertaken by local communities themselves

> There are still various challenges to overcome before the EPWS can be seen as fully operational and sustainable. A key task would be to establish the land use-service linkages as they would provide a clear incentive for both users and rural service providers to carry on with the PES scheme. Progress into phase 3 needs to be carefully planned out as the transition towards more community-based management as foreign donors exit, might have significant impact on the running of the project.

*An interesting point to note that the EPWS also showcases the potential of the use of water as an umbrella service to help in conservation of biodiversity of the forests within Uluguru Mountains!*

THANKS for reading such a long post! Just felt that there were a lot of interesting points brought up which were worthy for discussion. Do leave your comments on what you feel about this article! Hope this post has been helpful :)

~Till Next Time~

Photo of waterfall in Uluguru Mountains from Kili Worldborn Safaris