Payment for Ecosystem Services Lessons Learned

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Nature Kenya has been championing Mt. Kenya forest restoration by forging private-public partnership through a Water Payment for Ecosystem Service Scheme. As a result of the engagement: 1.

ENGAGING IN WATER PAYMENT FOR ECOSYSTEM SERVICES FOR MT. KENYA FOREST RESTORATION Mount Kenya is a critical biodiversity hotspot— Important Bird Area, World Heritage Site, National Park and National Reserve. Mt. Kenya is one of Kenya’s ‘water towers’ and is vital for reducing the impacts of climate change by acting as a carbon sink. The Mount Kenya ecosystem feeds into the Upper Tana River basin, and the hydrologic (water storage and flow) services provided by the Mt. Kenya and Upper Tana River ecosystems are extremely important for the Kenyan economy and environment. The Upper Tana basin provides water for one of the most productive agricultural areas in Kenya and key national parks and generates half of the country’s total hydropower. Rain-fed smallholder agriculture uses about one-third of the water budget.


The Mt. Kenya ecosystem is under serious threat of degradation. Deforestation remains the greatest threat facing the ecosystem; over the years there has been a decrease in water volume and quality due to loss of forest cover. Hydropower and domestic water reservoirs are getting silted with sediments from the degraded landscape, significantly raising water treatment costs. Rapid urban population growth and unprecedented industrial activity has given rise to increased water stress. Demand for drinking and industrial water use cannot be met. Furthermore, downstream water users, including hydropower producers, crop irrigation schemes, water abstraction and distribution companies, industries and others, are not contributing sufficiently towards upper catchment restoration. As a result local people represented by Community Forest Associations (CFAs), Community Based Organizations (CBOs) engaged in nature conservation and responsible government agencies do not have sufficient financial resources to restore Mt Kenya.

A business case was developed for the restoration of the Mount Kenya forest. Its main goal is to win highlevel commitment and support from the business sector, and their financial contributions to halt forest loss, restore degraded areas and promote sustainable production. In the business case, there is an economic justification for water quantity and quality and the negative impacts of degradation, especially on dam silting. We also captured the costs of planting a tree in Mt. Kenya.

2. A high level meeting of Nairobi-based downstream water users was convened in Nairobi, where the business case was presented. We invited water users in irrigation, hydropower generation, power transmission and marketing, hoteliers and water abstraction companies for industrial and domestic purposes. The same approach was used to convene meetings of downstream water users in Thika and Nanyuki towns. 3. The capacity of CFAs and CBOs based around Mt. Kenya to create awareness on payment for ecosystem services was enhanced. Developing institutional capacity through training on leadership, governance, financial management and marketing skills aimed to improve the local communities’ negotiation skills and credibility. 4. The business sector was encouraged to consider financial resource allocation in their budgets to enable Community Forest Associations (CFAs) to plant and nurture trees to maturity on Mt. Kenya. 5. Discussions were held with The Nature Conservancy (TNC) to create more awareness on the need for the Upper Tana - Nairobi Water Fund to support Community Forest Associations.

Members of Kenya Breweries Limited’s “Kijani Team” handing over tree nursery implements to the Hombe CFA.

the senior officers. There is need to meet senior officers in their offices to create one-on-one awareness. The Nature Conservancy is yet to operationalize the Upper Tana and Nairobi Water Fund. When operational, it will cover Mt Kenya where the water flows to the Tana River or is abstracted and used in Nairobi. The TNC is also considering to expand the water fund idea to cover other key selected water catchments in Kenya. Water Payment for Ecosystem Services schemes take a long time to set up, as evidenced from the Upper Tana and Nairobi Water Fund process. This is critical to ensure restoration actions are implemented ahead of formal PES schemes. It is possible to foster a relationship between CBOs and CFAs and downstream water users over and above the Nature Kenya direct relationship.


Private sector players are able to connect business success with sustainable water and electricity supply and are willing to contribute to forest restoration. Businesses are willing to engage. However, the representation in the meetings did not attract sufficient senior level decision makers in these businesses. Also, businesses have not carried out internal analysis to agree their appropriate impactful contributions to water catchment management. Some have developed corporate social responsibility schemes, which can be avenues for supporting environmental management. However, the funding levels remain low and much of the CSR is not in environment but in social fields including livelihoods and emergency response. That is why we want to encourage businesses to become aware of the critical importance of forests in providing water, so that they allocate more water catchment-earmarked financial resources into their CSR schemes and work with CFAs as their delivery partners.

A represenative of the Mt. Kenya Community Forest Associations (CFAs) making his contributions during the National Forest Program meeting.

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CFAs and CBOs around Mt. Kenya presented themselves as avenues for delivering forest restoration programs in key national forums such as the national dialogue for ‘mainstreaming biodiversity in sectors of the economy’ which catalyzed the implementation of the Kenya National Forest Program (NFP). Trained CFAs and CBOs are willing and able to mobilize financial support from the private sector. CFAs and CBOs need support to reach the business sector far away from their immediate locality. Businesses are willing to fund CFAs and CBOs that demonstrate financial management capability and delivery of planned targets. CFAs and CBOs are an asset for forest restoration in Mt Kenya.

Kenya Breweries Limited staff participating in a tree planting exercise at Hombe forest in Mt. Kenya.

The private sector has stringent financial procedures that require credible institutions who get prequalified as service providers. The private sector also wants publicity around their good work and financial support. They therefore need credible partners who should also help them grow their business through marketing and communications. Engaging senior level decision makers is critical. By targeting senior level officers, financial support is likely to be higher. As such, workshops are unlikely to be attended by

A Community Forest Associations (CFAs) tree nursery.


Commitment from stakeholders to increase surveillance and information sharing in the forest for wildfires during the dry season as well as stopping illegal water abstraction.

The issue of over abstraction of water from the various rivers flowing from the forest was discussed. Some of the water buyers advised to have water rationing during dry spells to enable the lower catchment areas to access this valuable resource.

Local hotels offered to partner with the CFAs by purchasing farm produce from the plantation establishment and livelihood improvement schemes, where the proceeds earned will be used in activities for the conservation of Mt. Kenya forest.


was committed by Kenya Breweries Limited to plant 100,000 trees within five CFA jurisdictions

Hombe and Kabaru CFAs received support of KSh. 2.3 million from the Upper Tana Water Services Trust Fund for forest rehabilitation.

The Kabaru CFA, through engagements and followups, were able to get Constituency Development Fund funding amounting to KSh.306,000 to fence their PELIS sites. PELIS (plantation establishment and livelihood improvement schemes) sites are where forest-adjacent communities are allowed to grow crops around newly planted seedlings for some years as they protect and nurture the seedlings.

20 COMMUNITY MEMBERS from five CFAs participated in a community exchange visit to Naivasha flower farms which illustrated modalities for engaging with local private companies.

5,000 TREE SEEDLINGS donated by Serena Mountain Lodge for rehabilitation of degraded forest areas.

The Cabinet Secretary for Environment and Natural Resources Prof. Judi Wakhungu (fourth right) poses for a group photo with some of the panelists during the National Dialogue on Biodiversity Mainstreaming into Sectors of the Economy.

Some water buyers promised to provide the CFAs with tree seedlings during the rainy season.

Water buyers pledged to collaborate with the CFA during the tree planting seasons to increase forest cover in and outside the forest through rehabilitation of riparian areas and establishment of more tree nurseries.

CHALLENGES FACED • • • • • • •

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Lack of a policy framework that provide guidance on how payment for ecosystem services scheme can work Insufficient awareness on what Payment for Ecosystem Services is by the water buyers, and how it is implemented. Lack of incentives to businesses and large water users from government to engage on forest restoration Some of the stakeholders are not aware of the existence of the CFAs and their activities in the forest. Limited capacity of local community in knowledge about relevant legislation, i.e. Water Act, Forest Act, etc. Inadequate resources to facilitate meetings with the local stakeholders. Both water resources and water users are not restricted to particular forest areas. Some river basins include various forest blocks, and some large resource users are unknown (for instance, the future city of Lamu Port). Lack of commitment from water buyers. Conflict between WRUA (Water Resource Users Assocation) and CFA operations which were observed to be reading from different scripts when it comes to the conservation of the forest. Over-abstraction of water, caused by limited law enforcement creating loopholes for illegal water abstraction.


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Increase awareness of the importance of Mt. Kenya forest and the PES program to all the stakeholders and water users. Contribute lessons learned to the development of the Upper Tana-Nairobi Water Fund operational strategies Lobby and advocate for recognition and implementation of payment for ecosystem services through national and county level policy and legislation Encourage continuous resource mobilization from the water buyers towards the conservation of Mt. Kenya forest. Provide linkages for water buyers and businesses with CFAs and CBOs where developed action or management plans can be presented. Promote continuous sensitization of businesses so that they can be informed of the importance of engaging with CFAs and CBOs in the Mt. Kenya forest conservation and rehabilitation programs Prioritize mapping of all the water buyers benefiting from the Mt. Kenya ecosystem.

Nature Kenya - The East Africa Natural History Society Tel: +254 (0) 02 3537568, +254 (0) 739 200216 Email: