Presentation by Charles Cowap MRICS FAAV to Agricultural Law Association, Exeter, 26 February 2013 outlining the development of a PES (Payments for Ecosystem Services) Scheme, development work funded by Natural Environment Research Council and South West Water

1. Agricultural Law Association
Water, Carbon and Biodiversity on
the South West’s Peat Moorland
Exeter
26 February 2013
Charles Cowap
Chartered Surveyor
Harper Adams University
Charles Cowap
MBA MRICS FAAV

2. New land management
Requirements are emerging
New markets
New challenges to
professional practice
Charles Cowap
MBA MRICS FAAV

3. Peat’s Story
Charles Cowap
MBA MRICS FAAV

4. Charles Cowap
MBA MRICS FAAV

5. Wimbleball Resr &
Context: Exmoor example R Haddeo
R Exe
Exmoor
R Barle
Replenishment
Exebridge Pumping
Pumping Approx 5
Station miles, lifting water
from 120 to 240 m
CO 2 AOD
Charles Cowap
MBA MRICS FAAV

6. Charles Cowap
MBA MRICS FAAV

7. Top 10 Business Opportunities
include:
1= Biodiversity Offsetting (BDO) and
Conservation Banking
• Estimated size of market £50 – 300 million
pa from housing, plus other sectors
• Brokerage, certification and registration
• Additional costs to builders/developers
deducted from land value
1= Peatland Carbon Code and Carbon Credits
• Peat restoration for carbon storage
• Management schemes and incentives
• Certification and brokerage
Charles Cowap
MBA MRICS FAAV

8. Layered PES (Payments for Ecosystem
Services)
– Different Environmental Services
to different buyers
– Eg 
Carbon sequestration
Charles Cowap
MBA MRICS FAAV

9. Reducing insurance risk through
green infrastructure
Environmental bonds
http://www.valuing-nature.net/opportunities-uk-business-
protect-and-value-natures-services-report-published-
today [accessed 19 July 2012]
Charles Cowap
MBA MRICS FAAV

10. Economics
+ OTHER ESS
CARBON
PAYMENTS???
Future
Profit for reinvestment
Storage/Abstraction
or distribution
Costs
Savings for water
Treatment Costs
buyers
Incentive payments to
Pumping Costs landowners –
managers - occupiers
Charles Cowap
MBA MRICS FAAV

11. Benefits must be owned by the Is it irreversible? Conflict of interest between RPA
Opportunity for existing scheme and Mire project - when spot check
landowner
Health of livestock - fluke on acreage for payment resulted in
Source of revenue for landowner Livestock safety stating that they would not pay for
Need for trust fund to remedy any It might not work, restoration might area affected by mire work
problems, eg solar deals with trust not work Opportunity costs for other activities
fund set up to remove kit Land not suitable for grazing,
If is not owned by the landowner
destock land
Cheaper water bills for SWW who owns the land and project?
customers Contravening Single Farm Payments Damage to grazing reversing 2,000
years of ag progress
Environmental benefits Collateral damage No rewards for joining the project
Jobs PIF [Permanently Ineligible Features SWW overriding everything
HLS for SFP] No allowance for inflation
Increased carbon Is there any way of making up the
Water retention, less flash flooding Increased silt peat into river reduction?
downstream Devaluation of agri land
More wildlife RPA Problems
Putting land that was drained back Health and safety problems
Future funding for restoration of
to its natural state
damage
Financial - tradeable commodity, What are the potential impacts
income for managing land naturally downstream?
Ecosystem service [? ..airs?] HLS Capital Works money being used
None for mire rather than hedge work
which directly benefits local
communities
Charles Cowap
MBA MRICS FAAV

12. Summary of concerns, Concerns Benefits Questions Totals
benefits, questions
Revenue/cost 6 3 2 11
Asset Value 4 2 0 6
Legal/ownership 1 1 3 5
Agricultural productivity 2 0 0 2
External liabilities 3 1 0 4
Animal welfare 2 0 0 2
H&S 1 0 0 1
Environmental 4 5 1 10
Wider economic 3 2 0 5
Scheme relationships 6 1 1 8
Confidence 8 1 2 11
Totals 40 16 9 65
Charles Cowap
MBA MRICS FAAV

13. Top Three Concerns
• Confidence
• Revenue/Cost
• Scheme Relationships
Charles Cowap
MBA MRICS FAAV

14. Top Three Positives
• Environmental
• Revenue
• Asset Value and wider economic aspects
Charles Cowap
MBA MRICS FAAV

15. Top Three Questions
• Legal/ownership concerns
• Revenue and cost
• Confidence
Charles Cowap
MBA MRICS FAAV

16. PROSPECTUS
• Proposed scheme(s)
• Basis(es) of offer
Charles Cowap
MBA MRICS FAAV

17. Questions for consideration
• Contractual aspects • Relationship other
• Land tenure schemes
• Effects on other • Other business
interested parties considerations
• Practical farming • Maintenance
considerations obligations
• Animal welfare and • Tax
health • Impact on value
• Public liability • Security/risk
Charles Cowap
MBA MRICS FAAV

18. Decision Criteria and guidance
Site suitability Land manager
• Peatland  known • All interests
mapped damage
• New management
• Detailed survey & mapping requirement?
• Damage restorable?
• Impact on other
• Farming impact? opportunities (+/-)
• Drainage/wetness
• Financial
implications for
surrounding land
Charles Cowap
MBA MRICS FAAV

19. Financial evaluation
Costs saved Extra costs, eg
• Eg some livestock purchases • Access time to more difficult
ground
• Vet and med bills
• Insurance
Extra Revenue eg • Feed
• PES income • Machinery costs (if
• Contracting opportunities for contracting to be offered)
SWW Lost Revenue
• Eg some livestock LWG or
sales
+ Balance: financially Balance positive: not financially
worthwhile worthwhile
• Consider capital and tax
implications
Charles Cowap
MBA MRICS FAAV

20. Discussion
Charles Cowap
MBA MRICS FAAV

21. Contact Details
Translating new knowledge for rural professional practice
 cdcowap@gmail.com
 07947 706505
Twitter: @charlescowap
Blog: http://charlescowap.wordpress.com/
Slideshare: http://www.slideshare.net/cdcowap
Charles Cowap
MBA MRICS FAAV