Ecosystems valuation

Ecosystem goods and services (EGS), such as water quality regulating services provided by wetlands or forests, are rarely formally bought and sold and have no specific market price. Monetary valuation of EGS can help address this issue by putting the benefits people receive from the environment in terms that allow comparison with other goods and services.

Valuation of ecosystem goods and services is used in a variety of ways. In addition to raising awareness and educating the public on the importance of EGS, valuation is used to help evaluate tradeoffs involved in land development decisions, identify ecosystem conservation and restoration needs, support ecosystem accounting, develop tax policies, and evaluate compensation relating to environmental damage claims. Numerous methods have been developed to estimate the monetary value of EGS. These methods focus on measuring the benefit or contribution that ecosystems and their functions make to human well-being. The type of policy use will determine the method and the level of accuracy required.

Statistics Canada studied some aspects of Ecosystem valuation of the Thousands Islands National park. The results are available in the publication Human Activity and the Environment 2013: Measuring ecosystem goods and services in Canada (see below).

For further details on ecosystem asset accounting, see the United Nations System of Environmental-Economic Accounting - Experimental Ecosystem Accounting manual, Chapter 5.