A Guide To Valuing Ecosystem Services

Guide to valuing
ecosystem services
REPORT 6854 • NOVEMBER 2018

Guide to valuing
ecosystem services
Translation of:
Naturvårdsverket. 2015. Guide för värdering av ekosystemtjänster.
Naturvårdsverkets rapport 6690.
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3041 0843
TRYCKSAK
Foreword
Ecosystem services are essential to our well-being. Yet we often take them for
granted. By perceiving and valuing ecosystem services, we can affect our future
well-being and quality of life. Politicians, public authorities, municipalities,
businesses, organisations, and individuals can thereby make more conscious and
well-informed decisions. For example, the value of ecosystem services should be
included in planning and decisions about land and water use.
Perceiving the value of ecosystem services is necessary for a society that aspires
to sustainable development. Valuation of ecosystem services provides a basis
for decisions on questions such as: Which areas should be preserved, and which
should be developed? Which ecosystem services do our activities and operations
depend on to function properly? Should the new residential area be located east or
west of the motorway? How should we design green spaces in the new residential
area to promote public health?
This guide does not provide answers to all possible questions on ecosystem
services but will guide you in finding the answers in your work. The content is
practice-oriented, with step-by-step instructions and a number of examples, and
it is intended for people who work in municipalities, business, public authorities,
county administrative boards, and interest groups. The Swedish Environmental
Protection Agency hopes that this guide will facilitate and inspire more people to
start valuing ecosystem services.
This guide has been developed in cooperation between Swedish authorities
within a Swedish government initiative on communication and ecosystem services.
This project is part of the effort to achieve the Sweden´s environmental milestone
target regarding the importance of biodiversity and valuation of ecosystem ser-
vices. Kerstin Bly Joyce, Swedish Environmental Protection Agency, is the contact
person for the guide.
The Swedish Environmental Protection Agency in November 2018

Contents
Foreword 3
INTRODUCTION 5
About the guide
What is economic valuation? 6
Why should we value ecosystem services? 8
Reading and working with the guide 8
VALUATION OF ECOSYSTEM SERVICES IN SIX STEPS 10

Step 1. What are you going to use the valuation for? 12
Step 2. Identify ecosystem services 16
Step 3. Limit the scope of the analysis 23
Step 4. Determine the starting points for the valuation 25
Step 5. Apply valuation methods 31
Step 6. Do a review 37
PRACTICAL EXAMPLES 37
C/O City – ecosystem services in urban planning 42
Lomma municipality – ecosystem services in local planning 47
Saltå Kvarn – a toolbox for action in the cultural landscape 51
Riksbyggen – a tool for assessing ecosystem services
in the construction sector 54
NCC – an analysis of ecosystem services
at the company’s headquarters 60
Sveaskog – markets for ecosystem services 64
Good marine environment – the importance of
ecosystem services for tourism and recreation 66
After-treatment of contaminated land
– the impact on ecosystem services 74
Monetary valuation studies
– the value of ecosystem services in monetary terms 78
BIBLIOGRAPHY 84
Introduction
Over the last few decades, the concept of ecosystem services has gained ground as
a way to make the functions and processes of ecosystem services and their connec-
tion to human well-being visible. The concept is relatively new; however, the way
of thinking is not. Plato stated about 2,400 years ago that deforestation around
Athens had led to soil erosion and dried up water sources.1 In short, people need
functioning ecosystems for society to work well.
The purpose of placing a value on ecosystem services is to shed light on and
build an understanding of people’s dependence on well-functioning and healthy
ecosystems by describing the values that are associated with ecosystem services.
Without such a valuation, there is a risk that ecosystem services will be given too
little weight in decision-making, which jeopardises the welfare of both current and
future generations. A valuation serves to shed light on the chain of relationships
linking ecosystem processes and functions to our well-being. In order to make
well-informed decisions, we need to implement the values of ecosystem services in
order to make well-informed decisions regarding sustainable development.
About the guide

How is a valuation done? The answer is, it depends. There are many guides in the
international literature, on how to do valuations. The form valuations can take
may vary depending on the purpose and context. The literature is sometimes
technical and sometimes oriented towards specific forms of valuation or towards
specific decision-making processes. Much of the Swedish literature on environ-
mental valuation has until now lacked a clear connection to ecosystem services
and has been oriented towards establishing a value solely in monetary terms.
This guide focuses on methodological aspects of valuation.2 It was originally
intended primarily for municipalities, businesses, public authorities, county
administrative boards, and interest groups in Sweden, This guide was translated to
inspire others within the Convention of Biological Diversity community to develop
their own processes and to illustrate how valuation of ecosystem services can be
done. The guide contains a step-by-step method for valuation, which accommodates
valuation studies with a variety of purposes and types. The guide is brief and pro-
1 Daily, G., (ed), 1997.

2 In other words, the guide does not address issues such as how to best implement the
findings from a valuation in an organisation or administration, or the staff resources that
may be required to implement the analysis, etc.
GUIDE TO VALUING ECOSYSTEM SERVICES 5

vides references to literature for further study. Moreover, the latter part of the guide
contains practical examples that show how valuation has been done.
The Swedish Environmental Protection Agency is responsible for this guide and
supporting documents have been produced by Anthesis Enveco (environmental
economics consultant). Feedback on the content and approach was provided
by authorities participating in the project, as well as the Network on Ecosystem
Services that was initiated by the project.
This guide has one main message: a valuation must be done methodically so
that important values are not missed, and the analysis should produce as much
information as possible in relation to the purpose of the valuation. Therefore, the
guide is based on covering relevant steps from a relatively early stage of analysis.
Accordingly, the guide does not contain detailed descriptions of, for example,
the various methods of monetary valuation, which should be done in a relatively
late phase of the evaluation. References to the literature are instead provided for
further study.
What is economic valuation?

There are many ways to establish a value. How that value is to be expressed is
a discussion in itself. This guide is about economic valuation, which means that
ecosystem services are valued based on the benefits they generate for people
and society. Economic valuation deals with how people’s well-being is affected
by their conceptions (preferences) about what plays a role in their well-being,
given a world with limited resources. As we continue writing about valuation in
this guide, reference is made to economic valuation, but values are not always
expressed in monetary terms, but rather the benefits of ecosystem services to socie-
ty (well-being) and business profitability.3
Values can be expressed in different ways

One limitation of economic valuation is that it does not necessarily mean that
values can be expressed in monetary terms. Later in the guide, we describe a num-
ber of ways to value relevant considerations or factors:
• Qualitative valuation: Values expressed in words.

• Semi-quantitative valuation: Values expressed in a point scale.
3 Benefits to society are theoretically represented by the sum of consumer and producer
surpluses, roughly, well-being and profits. Economic benefit for a business can be regarded
as a contribution to a company’s profitability in the short-term and long-term. Business
management benefit analysis and socio-economic benefit analysis might therefore differ.
6 GUIDE TO VALUING ECOSYSTEM SERVICES

• Quantitative valuation: Values expressed in terms of some physical unit,
such as the amount of raw materials produced during a certain period or the
number of visits to a recreational area.
• Monetary valuation: Values expressed in monetary units.
Valuation is based on a chain of events

Ecosystem services can be defined as the direct and indirect contributions of
ecosystems to human well-being.4 This means that it is important to increase
the visibility of structures, functions, and processes in different ecosystems that
ultimately benefit society. The interaction between the ecosystem and people can
be described through a chain of events. This chain of events may have different
appearances and terminologies, but usually the meaning is similar, as seen in the
following two examples:
• The ability of the ocean to cleanse water from environmental toxins results in
good water quality in conjunction with other oceanic processes, thus creating
favourable conditions for swimming, which many people value.
• Vegetation in the urban environment contributes to natural noise protection,
which positively affects our health.
A division of the services into indirect and direct ecosystem services is often used.
What is direct and indirect can sometimes be difficult to determine, but it is clear
that such a way of thinking is necessary to understand the ecosystem in relation to
people. In the ocean example above, water purification is regarded as an indirect
ecosystem service, while good water quality is a direct ecosystem service, and
bathing/ swimming is an activity asset that generates value.
The conceptual approach can vary among different reports and contexts, but
the main point is the same: valuation is based on a chain of events. If we eliminate
the ecosystem’s ability to cleanse dangerous substances from the water, it will
have consequences for people. If we do not create the prerequisites for vegetation,
the urban environment becomes noisier and our well-being suffers. Therefore,
we need to understand the processes of ecosystems, how human activities and
decisions affect them, and what we can do to improve or restore their function.
4 TEEB, 2010.

Why should we value ecosystem services?
Making the value of ecosystem services visible means that we can arrive at sound-
er decisions in relation to people’s need for functioning ecosystems. Decisions
affecting ecosystems are made daily by politicians, public authorities, munici-
palities, businesses, and other organisations as well as by individuals. By valuing
the ecosystem services that may be affected by different decisions, balance can be
achieved between different options to ensure that the long-term needs of society
for functioning ecosystem services are met. Here are some examples of purposes a
valuation can serve;
• To determine if a project, a plan or a policy leads to socio-economic profita-

bility and to prioritise among different measures or alternatives.
• To investigate conflicting objectives and to facilitate trade-offs between
different objectives.
• To serve as a basis for decisions on land use: where can we place buildings
or infrastructure and what is the prospect for this to contribute to and not
degrade, the ability of the ecosystem to generate ecosystem services?
• To help communicate the value of an endangered ecosystem service (“the cost
of inaction”) or the value of a project that improves the ability of ecosystems
to generate social benefits by, for example, restoration or re-creation of
natural environments.
• To form the basis for decisions about a company’s strategic direction – for
example, to prepare the organisation for future risks in the supply chain
associated with impact on the environment or to support a company’s efforts
to make a positive contribution to public welfare.
• To develop the basis for environmental accounts in a municipality or nationally.
Reading and working with the guide

This guide can be read either from start to finish or in individual sections. The
guide has two parts: the first section is a step-by-step guide for economic valuation
with bibliographical references, and the second section provides practical exam-
ples of how various actors have applied these methods.
The guide is intended to be a means of support rather than a handbook. It is
meant to be a practical source of inspiration for how valuation can be done.
However, different situations entail different analytical needs, and in some cases,
things need to be done in another way or in another order. For example, one

alternative might be to stop after the identification of ecosystem services in step 25
because this step provides a relatively good first overview. Another alternative is to
focus on individual aspects and thus not do undertake the broad survey that tak-
ing all of the steps entails. The guide covers a variety of different types of purposes
and contexts. It is necessarily “watered down” to a certain extent. References are
provided to more specialised literature in various areas, instead of a detailed text
in the guide. The guide can also serve as a starting point for the preparation of
more specific guides and handbooks in different contexts.
LEARN MORE:
WHY VALUE ECOSYSTEM SERVICES?
SOU 2013:68 concerning ecosystem services provides many thorough lines of

reasoning and an abundance of literature references. For example, see section
1, which has a wide-ranging discussion of the ecosystem services concept and
its valuation.
SOU 2013, 2013. Making the value of ecosystem services visible. Proposals to
enhance well-being through biodiversity & ecosystem services. Swedish Govern-
ment Inquiries. English Summary of SOU 2013:68.
The Swedish Environmental Protection Agency’s white paper provides an
overview of ecosystem services in Sweden according to different habitat types. It
also explains the background of the concept of ecosystem services and valua-
tion. See, for example, pp. 34–36: “Why should we value ecosystem services?”
Swedish Environmental Protection Agency, 2012. Compiled information on
ecosystem services. White paper 2012-10-31. In Swedish
5 See the next section ”Valuation of ecosystem services in six steps”.

Valuation of ecosystem
services in six steps
The following premises have been of vital importance for the guide:
• A valuation of ecosystem services should be broad in terms of ecosystem

services that are covered in the analysis. What we are striving for is to not
miss essential values because of a limitation in the scope of the analysis.
We should also be aware of the possibility that essential values have been
missed because of the limitation in the scope of the analysis.
• Analytical resources are limited. This means that there must be a balance
between what should be covered and how deep the analyses should be.
• Everything does not have to be measured in numbers and monetary units;
it is possible in many cases to come a long way with qualitative studies.
• There are always uncertainties, and these should be made clear to a reasona-
ble extent. However, the complexity of the ecosystem makes it impossible to
clarify everything.
• It is better to do something than nothing at all. However, we need to consider
that good decisions require a good basis for decisions.

The following six steps for valuation were developed based on the basic premises
given above and to reflect the relevant (scientific) literature, and at the same time
allow for many possible purposes for valuation. These six steps are:
1 What are you going to use the valuation for?
2 Identify ecosystem services
3 Defining the analysis
4 Determine starting points for the valuation
5 Apply valuation method(s)
6 Do a review
Please note that the process is not always done one step at a time, from step 1 to 6,
repetition of some steps may be needed. For example, a preliminary assessment
of the value of an ecosystem service (step 5) could form the basis for limiting the
scope of the ecosystem services that will be analysed further (step 3).

Step 1. What are you going to use the valuation for?
1 What are you going to use the valuation for? • The purpose of the
valuation should be
related to the overall
2 Identify ecosystem services goal of the activity.

• Different purposes
3
require different
Defining the analysis approaches for
valuation.
6 Do a review
At the heart of the valuation is that it is designed to fulfil some specific purpose,
and that purpose is important for the way the study is set up. Consequently, you
should specify what you are going to use the valuation for. A number of possible
starting points could be to:
• Balance different interests and prioritise among different things that require
funding. Which areas should be preserved, and which should be developed?
Which environmental improvement measures are most important for a com-
pany or municipality? What level of ambition is reasonable in environmental
work?
• Make ecosystem services visible in relation to your activities. How do your
activities affect various ecosystem services? Which ecosystem services do
your activities depend upon to function, and what possible business risks and
opportunities do you envision?
• Make a positive contribution to the provision of ecosystem services or minimise
the negative impact. What measures are needed for a project or a certain
operation to be sustainable?
• Choose among alternative development options. Should the new commercial
area be located east or west of the motorway? Should we go in for a park or
a nature reserve in a specific place? How should we design green open spaces
in the new residential area?
You can surely find one or more among these starting points that are more rele-
vant than the others. Often, but not always, one valuation of ecosystem services is
linked with another broader process; see Box 1 for some typical areas of applica-
tion.

EXAMPLES OF PROCESSES WHERE
ECOSYSTEM SERVICE ANALYSES ARE RELEVANT
• Physical planning.
• Environmental impact assessment.
• A socio-economic impact assessment of a particular decision or project.
• Development of municipal strategies.
• Development of corporate sustainability or business strategies.
• Risk analyses.
Box 1. Valuation of ecosystem services is often, but not always, linked to some broader process.
Given the overall formulation of purpose and the intended fields of application,
it is necessary to more exactly define what is to be measured. Possible types of
valuation studies and what could be measured are:
• Supporting data for a socio-economic impact assessment. The socio-economic

costs and benefits, distributional aspects, and financial effects that can be
expected given the implementation of some project or a plan or policy.
• A valuation of existing ecosystem services at a certain location. For example, in
physical planning the location and importance of ecosystem services can be
pointed out.
• An analysis of the contribution of ecosystem services to the regional economy or
health. Descriptions of how various ecosystem services contribute to employ-
ment, tax revenues or various measurements of public health.
• An “eye-opener”. Developing supporting documents that can powerfully com-
municate the value of a specific ecosystem service that is threatened or that
could be improved.
• A business-economics risk analysis or an analysis of the impact on ecosystem
services. Dependencies are identified. What ecosystem services is the compa-
ny dependent on and to what extent? What ecosystem services are affected
by the company’s activity and to what extent?
• A basis for environmental accounting. Supporting data, such as that which can
be included in “green” national or municipality environmental accountings.
The purpose of valuing ecosystem services governs how you should design your
study – for example, with respect to how ecosystem services should be identified
(step 2), which ecosystem services should be given extra focus (step 3), the
starting points that should apply to valuation (step 4), and how the value should
be expressed (step 5) – for example, whether the valuation should be qualitative,

quantitative, or monetary. Table 1 provides some examples of valuation studies
and how these relate to the requirements in steps 2–5 of the analysis. The text in
the table is intended to illustrate the approach that is most common or possible in
relation to different types of valuation studies. Other approaches or schemes are
also possible.
Table 1. Different types of valuation studies entail different approaches.
The purpose of the Is a complete Should the What are the starting points Which expression of
analysis (Step 1) identification scope of the for the valuation? value is common?
of ecosystem analysis be (Step 5)
services need- limited in some
ed? (Step 2) way? (Step 3)
A basis for a socio- Yes Preferably not • Define environmental • Words

economic impact changes resulting from the • Scores
assessment project, plan, or policy
• Some physical units
• Describe how the envi- (e.g., quantity of a good)
ronmental changes affect
ecosystem services • Monetary units
A valuation of existing Yes Preferably not Value the aggregate existing • Words
ecosystem services resources at different • Scores
at a certain location locations
• Some physical units
(e.g., areas of a certain
natural habitat type)
An analysis of the con- Maybe Yes Make a link between • Words

tribution of ecosystem ecosystem services and tax • Scores
services to regional revenues, jobs, health meas-
economy or health urements, etc. • Job, health measure-
ments
• Monetary units (in tax
revenue)
An “eye opener” No Yes • What is at risk of being lost? • Monetary units

or • Some physical units
(e.g., the quantity of a
• Aggregate value of any
good)
particular type of nature?
A business-management Yes Preferably not • How does a change in • Monetary units

risk analysis or analysis access to ecosystem services • Impacts on production
of impacts on ecosystem affect production?
services • Scores
or
• How do the company’s
operations affect ecosystem
services
A basis for environmental Maybe Maybe How big is the aggregate • Monetary units
accounts resource? • Physical units

LEARN MORE:
VALUING FOR DIFFERENT PURPOSES AND CONTEXTS
Valuation for physical planning/land use: The United Nations Environment

Programme (UNEP) has issued a handbook on how ecosystem services can be
integrated into physical planning and strategic environmental assessments.
UNEP, 2014. Integrating Ecosystem Services in Strategic Environmental Assessment:
A guide for practitioners. A report of Proecoserv. Geneletti, D.
____
The value of ecosystem services in the regional economy: See, for example,
Boston Consulting Group, 2015, which has calculated municipality economic
effects of a better Baltic Sea environment.
Boston Consulting Group, 2015. Restoring Waters in the Baltic Sea Region – A strategy
for municipalities and local governments to capture economic and environmental benefits.
February 2015.
____
Monetary valuation as “eye-openers”: See, for example, the Swedish Environ-
mental Protection Agency’s guide to “scenario methods”, which is an in-depth
report in support of the implementation and procurement of valuation studies
based on scenario valuation. See also the suggested literature presented in
step 5.
Swedish Environmental Protection Agency, 2011 Ekonomisk värdering med scenariometoder
– en vägledning som stöd för genomförande och upphandling Economic valuation with
scenario methods – a guide in support of implementation and procurement. Report 6469,
November 2011. In Swedish with English summary.
____
Valuation for companies: See the World Resources Institute report on Corporate
Ecosystem Services Review (ESR), which contains a step-by-step guide to
illustrating the risks and opportunities for a company in relation to ecosystem
services.
Hanson, C., Ranganathan, J., Iceland, C., Finisdore, J., 2012. The Corporate Ecosystem
Services Review: Guidelines for Identifying Business Risks and Opportunities Arising from
Ecosystem Change. Version 2.0. Washington, DC: World Resources Institute.
____
Environmental accounts: Ecosystem services have not yet taken a giant step into
environmental accounts.
SCB, 2013. Inventory of data sources for quantification of ecosystem services. Environmental
accounts 2013:2.6
Björk, O., Palm, V., Steinbach, N., Lone, Ø., Kolshus,K., Gravgård. Pedersen, O., Krarup,
S., Kolttola, L., and Lindblom, A., 2016. Making the ecosystem count. Nordic accounts and
indicators for analyzing and integrating environment and economy. TemaNord 2016:507.7
67
6 https://www.scb.se/statistik/_publikationer/MI1301_2013A01_BR_MI71BR1303.pdf
7 https://norden.diva-portal.org/smash/get/diva2:915431/FULLTEXT01.pdf

Step 2. Identify ecosystem services
1 What are you going to use the valuation for? • A broad identification
of ecosystem services
2
is needed.
Identify ecosystem services • Also try to identify
which ecosystem
3
services depend on
Defining the analysis each other.
• Use a list of eco-
4 Determine starting points for the valuation system services; there

are many to use as a
basis.
5 Apply valuation method(s) • Describe the way the

ecosystem service
6
appears to be or is
Do a review affected.
After the purpose of the analysis has been established, relevant ecosystem services
are identified. A comprehensive strategy can be to base the identification on a
gross list of ecosystem services. Various lists or classification schemes and catego-
risations of this nature are available in the literature (see the suggested literature
at the end of this section). Different classification schemes may be suitable for dif-
ferent environments and habitat types. Figure 1 provides examples of an overview
of ecosystem services in the forest. The Economics of Ecosystems and Biodiversity
(TEEB) has prepared a general classification with categories that are designed to
be generally applicable (see the suggested literature at the end of this section). The
PROVISIONING REGULATING CULTURAL

For example: For example: For example:
• grain • pollination • outdoor recreation
• drinking water • purification • health and
• timber of air and water inspiration
• bioenergy • climate regulation • natural heritage
and tourism
SUPPORTING
So that other services will function, such as:
• photosynthesis, soil formation, biogeochemical cycles
Ecosystem services are usually categorised as provisioning, regulating, cultural, and

supporting services.

Food
Stable and secure land such as berries, mushrooms,
through the ability of roots to and meat from game.
bind soil and water
Pollination Wood and bioenergy

of both the forest’s own 5
5.
through the felling of trees for the
species, such as blueberries pulp and paper industry and for
and lingonberries, and sawmills, as well as for biofuel using
for agricultural and thinned-out branches and tops.
horticultural crops.
Nature experiences
Pest control with all that entails for the quality
of life of individuals and for tourism.
Through the forest’s own
large and small predators
and parasites that are
natural enemies of
species that can become
harmful agents
Climate regulation
Flood protection
by storing carbon in trees and
through water absorption by trees and
soil and temperature equalisation.
abundant litter layers (soil layers with
partially decomposed plant material)
Nutrient supply and water retention in wetlands covered
by boreal forest.
and recycling of nutrients that the
forest needs is provided by fungi
and microorganisms in the soil.
Figure 1. Ecosystem services in the forest. SOURE: MINISTRY OF THE ENVIRONMENT AND ENERGY
Swedish Environmental Protection Agency has developed a classification scheme

adapted to Swedish conditions. There are also more specific lists, such as for agri-
culture, the marine environment, the forest, and so on.
Most classifications are based on the system used by the Millennium Ecosystem
Assessment, including provisioning, regulating, cultural and supporting ecosystem
services (see illustration on page 16).8 Provisioning services provide products and
benefits such as food and wood fibre. Regulatory services affect or govern the
natural processes of the ecosystem, such as its capacity for water retention and
biological control of pests. Cultural services provide experiential values such as
recreation, while supporting services are the prerequisites that enable the other
ecosystem services to function, such as photosynthesis and soil formation.9
When you have found a suitable list or classification scheme of ecosystem
services, you should describe them, based on a number of aspects. A possible
start for this description is provided in table 2, which gives some examples of key
questions for each of the ecosystem services. To answer the questions, you may
8 MEA, 2005.
9 Note that biodiversity is not mentioned as an ecosystem service in most classifications. The
reason for this is that biodiversity per se is not regarded as a prerequisite for all ecosystem
services.

need the support of other existing data, specialist expertise from different fields of
study, or discussions with relevant interested parties.
Try to identify and explain the uncertainties that exist when you answer the
questions.
1. Does the ecosystem service exist in the area?

If your analysis is oriented towards a particular geographic area, you need to first
ascertain whether the ecosystem service exists in the area. Even if you determine
that the scope of the service is small, you should, for the time being, include the
ecosystem service for further analysis.
It is a good idea to give some thought to the time perspective: Even if an eco-
system service is not perceived as being particularly important at present, it could
become important in the future. An example is flood protection, which can be
expected to become more important in the future as a result of changes in precipi-
tation patterns and amounts. Natural functions such as infiltration or transpiration
can help to reduce or intercept peak flows. Another example may be the number and
accessibility of green spaces in urban areas that are presently available for nature
experiences, but as a result of development will become scarcer.
2. What areas are especially important for the ecosystem service?

Try pinpointing the places or geographic areas that are particularly important for the
ecosystem service. For example, this can involve pointing out recreational areas or
investigating where there are important habitats for key species that contribute to
important functions in the ecosystems or identifying areas with soil conditions that
contribute to flood protection.
3. In what way does the ecosystem service create benefits?

Describe in a general way how the ecosystem service creates benefits for people.
You should have an ecosystem perspective combined with a social perspective – that
is, you should describe in a general way processes in the ecosystem that ultimately
lead to a positive impact on society. In the case of the flood protection service, for
example, this may include a description of how the ecosystem contributes to flood
protection and what this service subsequently leads to, such as a reduced need to
construct other flood protection or completely avoiding the risk of flooding.
4. Who benefits?
Describe who benefits from the ecosystem service. Some ecosystem services,
especially the supporting and regulating services, benefit society at large by sus-
taining important functions. Other services are more clearly linked to stakeholders
in some particular area or in some particular industry. Try to describe these various
geographical scales.

5. Is the ecosystem service threatened?
Make an assessment of the scarcity of the ecosystem service locally, regionally,
nationally and/or globally. Ideally, think long term; in other words, try to describe how
the threat to the ecosystem service is likely to be in the future. It may be difficult
to assess, but it can be helpful to use literature surveys or local knowledge. It can
be particularly threatening if a negative effect can lead to threshold effects in the
ecosystem that are difficult to repair. Therefore, try to include a risk perspective in
your assessments.
6. What other ecosystem services does it depend on or affect?

An additional task that is important before the valuation is the investigation of
interactions among ecosystem services. In this way, underlying ecological connec-
tions that ultimately lead to benefits are made visible. For example, the production of
fish depends on a functioning habitat, which in turn is dependent on water quality,
which in turn is dependent on a number of supporting and regulating services, such
as water purification and flood control.
As described in the introduction, the concepts of direct and indirect ecosystem
services are often used to distinguish between ecosystem services that generate ben-
efits directly and the underlying services that are the basis for the creation of these
benefits. In the above case, fish production is a direct service, while habitat, water
purification, and flow control are indirect services.
If your valuation study involves assessing the consequences of a particular project,

plan or policy, or some other form of change, you will also need to identify which
ecosystem services are affected. The above six questions serve as a basis for mov-
ing forward with this analysis. At any rate, it is important to ask the following
four questions (7-10):
7. Is the ecosystem service affected by the project?

This question is easy to ask but can be difficult to answer. Even if you determine
that the effect is small, you should answer yes to this question to further investigate
the ecosystem service at a later stage. Effects may be direct, such as when a previ-
ously undeveloped area is developed, or indirect, such as through
on-going effects over a period of time.
8. In what way is it affected?

Is the effect positive or negative? Try to describe what aspects of the project lead to
the effect. Use a systems perspective in which you describe what depends on what.

9. Who benefits or suffers?
Your answer to question 4 should give you a good basis for answering this question.
Remember to also consider how an improvement or deterioration of ecosystem
services affects the ecosystem at large and thus people in places other than just the
where the project is implemented.
10. How can negative effects be avoided, minimised, remedied, or compensated?

If the project, plan, or policy leads to negative consequences for ecosystem services,
consider what measures can be taken so that the damage can be avoided, mini-
mised, remedied, or compensated. In some cases, it may be possible to avoid certain
negative impacts on ecosystem services or even to generate a net positive outcome
in the end. This may then have consequences for the valuation. If the project/plan/
policy essentially leads to a positive impact on ecosystem services, you can here, as
a final step in the identification process, reflect on whether any action is relevant to
further reinforce these positive impacts.
When you have answered these questions, you have to some extent already valued
many aspects. Feel free to summarise your findings and gather points of view from
those affected or other experts.
USEFUL TOOLS AND RESOURCES FOR IDENTIFICATION
• A “complete” list of ecosystem services from the literature that is suitable for
the specific case, or alternatively a general list from TEEB or elsewhere.
• Available surveys of the ecosystem services in an area or in a particular habitat
type or other analyses of the consequences of a certain type of project.
• Maps.
• Geographic information system (GIS) data.
• Information related to protected areas, where relevant.
• Aerial photos and satellite images.
• Field surveys (geological inventories, species inventories, etc.).
• Consultation with experts and stakeholders.
• National or international ecosystem service assessments, such as various
applications of TEEB.
Box 2. In doing the identification, you can get help from a variety of tools and resources.

21
GUIDE TO VALUING ECOSYSTEM SERVICES
Ecosystem service If you are assessing the consequences of a project, plan,
Table 2. A possible checklist for the identification of ecosystem services in an area as well
or policy, use these columns

1. Exists 2. What 3. How 4. Who 5. Is the 6. What other 7. Is it 8. In what 9. Who 10. How can
in the areas are is benefit benefits? ecosystem ecosystem services affected by way is it benefits or negative effects
area? especially created? service does it depend on the project? affected? suffers? be avoided, mini-
as for the identification of ecosystem services that are affected by a project.
important? threatened? or affect? mised, remedied,

or compensated?
(Yes/No) (Feel free (Describe) (Describe) (If Yes, (Try to describe the (Yes/No) (Describe) (Describe)
to use describe in chain of effect) (Describe possi-
map tool) what way) ble strategies)
Supporting EST 1
EST 2
... osv
Regulating EST 1
EST 2
... osv
Provisioning EST 1
EST 2
... osv
Cultural EST 1
EST 2
... osv
LEARN MORE: LISTINGS OF ECOSYSTEM SERVICES
IN DIFFERENT ENVIRONMENTS
TEEB provides a general classification that can be adapted to many contexts.

One of the TEEB reports also offers an overview of TEEB’s classification in
relation to some others; see p. 40 in the following document:
TEEB, 2013. The Economics of Ecosystems and Biodiversity – Ecological and Economic
Foundations. Chapter 1 – Integrating the ecological and economic dimensions in biodiversity
and ecosystem service valuation.
IPBES, 2018. Summary for policymakers of the IPBES Regional Assessment Report on
Biodiversity and Ecosystem Services for Europe and Central Asia. 10
____
For the marine environment, Garpe’s division from 2008* is often used.
Garpe, K., 2008, Ecosystem services provided by the Baltic Sea and Skagerrak. Report 5873,
Swedish Environmental Protection Agency, Stockholm.
____
For the forest, the Swedish Environmental Research Institute’s compilation can
be used, for example, see p. 14.
Swedish Environmental Research Institute (IVL), 2014. Ecosystem services in Swedish
forests. IVL Report B2190.In Swedish. English summary in: Hansen, K. and Malmaeus,
M., Ecosystem Services in Swedish forests. Working papers of the Finnish Forest Research
Institute, Finér, L., Karvinen, L., And Stupak, , I., (ed.) pages 43–44.11
Swedish Agency for Marine and Water Management, 2015a. Ecosystem services in Swedish
forests. Bryhn, A., Lindegarth, M., Bergström, U., Bergström, L., Swedish Agency for Marine
and Water Management’s report 2015:12.
____
For groundwater, the Geological Survey of Sweden’s report from 2014 takes up
the concept of groundwater services, which does not necessarily have a link with
the biotic processes of the ecosystem, but definitely to people and to land use
decisions, among other things.
Geological Survey of Sweden (SGU), 2014. Grundvattnets ekosystemtjänster (Groundwater
ecosystem services and their economic value — an initial mapping). SGU report 2014:40. In
Swedish,
Griebler, C. and Avramov, M., 2015. Groundwater ecosystem services: a review. Freshwater
1011Science 34: 355 -367.
10 https://www.ipbes.net/system/tdf/spm_2b_eca_digital_0.pdf?file=1&type=node&id=28318
11 http://www.metla.fi/julkaisut/workingpapers/2014/mwp316.pdf#page=43

Step 3. Limit the scope of the analysis
1 What are you going to use the valuation for? • Often, no specific
limitation in the
2
scope of the analysis
Identify ecosystem services is needed, but a more
overarching analysis
is made.
3 Defining the analysis • Limit the scope of

the analysis on the
4
basis of your overall
Determine starting points for the valuation objective.
• Consider what the

consequences will
be if you choose to
not consider some
6 Do a review
ecosystem services.
Limiting the scope of what is to be further analysed may be necessary. The basis
for limiting the scope of the analysis may look different depending on the purpose
of the valuation. Examples of factors that can govern your choice of limits in the
scope of the analysis can be:
• Local priorities – there may be policy documents or other explicit wishes.

As a result, the valuation may be particularly important for some ecosystem
services that occur or should occur locally.
• Available resources – access to time, available knowledge, data, and expertise
can mean that you will be able to go in-depth for some ecosystem services,
whereas this may be more difficult for other ecosystem services. This can be
a basis for limiting the scope of the study. However, this should not be the
overriding factor for the analysis. Remember to define the limits based on
your overall objective.
• Time perspective – do you want to give priority to ecosystem services that
generate value now or ecosystem services that could generate value in the
future?
• The degree of impact – perhaps you want to focus on valuing ecosystem
services that are expected to be affected to a large extent by your project,
plan, or policy and are content with the analysis made in the identification
step for the ecosystem services that are expected to be affected to a lesser
degree.
• Type of ecosystem services – for some reason, you may want to focus on fur-
ther analysing a particular ecosystem service or a specific group of ecosystem
services.

Limiting the scope of the analysis means that you disregard something. It is
particularly important to reflect on what this entails when you subsequently draw
conclusions. Furthermore, you need to make trade-offs given the available time
and other resources. Do you want a broad overview, or to focus on something
in particular? It is difficult to do both. A good identification in step 2 provides a
platform that helps you limit the scope of the analysis without losing the necessary
holistic perspective. Be transparent in your description of the limits that have been
made and that motivate your choice.

Step 4. Determine the starting points for the valuation
1 What are you going to use the valuation for? • Investigate the value
creation chain and va-
2
lue direct ecosystem
Identify ecosystem services services as a priority.
• Investigate whether
3
you are overlooking
Defining the analysis any important values.
• It is important to also
4 Determine starting points for the valuation describe the values

that can be generated
or be at risk in the

future.
• Values can be
6
described in words,
Do a review scores, physical
measurements, or
monetary units.
Choose approaches
based on the purpose
and conditions.
When you have identified relevant ecosystem services in step 2 and determined
what is to be further analysed in step 3, you should take the next step towards
being able to value them by establishing guidelines for valuation. Given your
identification in step 2, you have already come a long way towards describing the
types of values that are generated, who is affected, and the interaction between
different ecosystem services.
In step 4 you should:

• Further investigate how values are created by the ecosystem services you
have identified.
• Investigate the type of values created.
• Decide how the value should be expressed. (Do you want to describe the
value in terms of words, scores, physical units, or monetary units?)
In addition to these aspects, you also should make clear what it is you want to
value. For example, do you want to describe the value of existing ecosystem
services at a specific place or do you want to study the effects of a particular
project or decision? Being able to provide answers to this question is the key to
structuring your analysis and moving forward with determining the starting points
for the valuation.

It is important to remember the following fundamental principles for valuation:
• The contributions of ecosystems to human well-being is what should be valued.

• The value is site-specific.
• The value depends on the scarcity of the service locally, regionally, nationally,
and/or globally.
• Double counting of values should be avoided.
Investigate how values are created

As much as possible, you should try to value ecosystem services based on their
“final benefit”. This means that the interactions between different ecosystem
services that you identified in step 2 should be concretely classified as direct and
indirect ecosystem services and that you are valuing the indirect ecosystem services
through their contributions to the direct services. Otherwise there is a risk of
double counting, much like the double counting that would occur if the value of
a loaf of bread were calculated as the value of the loaf plus the value of the input
goods – i.e., the value of the flour plus the value of the wheat and so on. Instead,
Cultural heritage Food

both the unique biological cultural heritage such as berries, mushrooms and
and the cultural heritage of the Sámi meat from reindeer, other domestic
people and others in the alpine area animals and wild game.
are a source of inspiration and art.
Natural heritage Recreation

distinctive biodiversity is
not only a prerequisite for
and nature tourism
the ecosystems’ ability to opportunities for skiing, hunting and
provide ecosystem services fishing, combined with unique nature
but also a value in the form experiences, enhance quality of life
of the heritage associated for people and contribute to tourism.
with the mountains.
Climate regulation Natural water regulation

by storing carbon in vegetation and peat
(carbon stored in partially decomposed
vattenreglering
plant material). Temperature equalization The flood zone along unregulated streams
in winter through reflection of solar provides capacity for natural flow regulation
radiation by snow in open areas, what and water absorption. Flood zones also create
is called the albedo effect. important spawning environments for fish
and counteract regrowth of the riparian zones.
Resource for research

and development
unique opportunities for research and
education in climate, ecology and geology.
Figure 2. Ecosystem services in the mountains. Which of the ecosystem services affect each
other and what is a prerequisite for what? SOURCE: SWEDISH ENVIRONMENTAL PROTECTION AGENCY

the value of the input goods is included in the value of the loaf. Therefore, try to
capture and describe the interactions between ecosystem services.
A tool that can be used, as illustrated in the introduction, is a value creation
chain from indirect to direct services that leads to benefits and that can then be
valued. Sometimes it can be difficult to place the various components under their
correct label. Ecosystem services can be regarded as direct from some points
of view and as indirect from others. For example, good water quality can be
considered a direct service that enables water extraction for drinking water, but
also as an indirect service that leads to the supply of fish, which in turn enables
commercial fishing yields.12 It is important to ask the questions: “What leads to
what, which services generate benefits for us and that ultimately can be valued”?
A possible approach can be to start from the end of the chain – in other words,
the final benefit – and work backwards. For example, ask yourself the question:
What ecosystem services are prerequisites for commercial fishing?
When the value creation chain is prepared, it is also important to ask yourself
if something is missing. Figure 2 illustrates ecosystem services in the mountains
and at least one value chain is seen. One value chain is “natural water regulation”
which affects the production of food, and recreation and tourism. Water regula-
tion may also affect many of the other ecosystem services, such as natural heritage
and climate regulation. In addition, water regulation can also mitigate the risk of
flooding downstream.
Different types of values

We continue with the example of ecosystem services in the mountains. Different
benefits generate different types of values. The ability of the ecosystem to produce
and create benefits in the form of food and recreational angling lead to what
is known as use values – that is, values based on the use of a certain resource.
However, people can place great value on natural heritage, regardless of whether
we visit the area or not. This is what we refer to as a non-use value (see Box 3 for
more details). Some valuation methods are more suitable for capturing use values
while others are more suitable for capturing non-use values.
12 In the process of mapping the value chain, it may also be relevant to reflect on what
investment capital or what input goods are required to make use of a service.

THERE ARE DIFFERENT TYPES OF VALUES
The term use values refers to values that are generated as a result of using
goods or benefits. For example, this may involve the use of raw materials or the
use of a nature area for recreation.
The term use values also encompass future use as well as more indirect values,
such as option values and information values, which in brief reflect the fact that
an ecosystem service can be beneficial and create use values in the future, but
we do not yet know how or the size of the values involved. These aspects are
often overlooked in the valuation literature, but it is nonetheless important to
describe them to get a more complete picture of the total value of an ecosystem
service. Often the term “insurance value” is used in this context. However, it
is often difficult to quantify insurance values in monetary units. This requires
developing long-term scenarios for how the world around us may evolve and
what role ecosystem services may play in the future given this evolution.
The term non-use values refers to values such as the desire to pass on healthy
ecosystems for future generations or the values associated with the knowledge
that ecosystems are in good condition.
Often the term total economic value (TEV) is used to ascertain that the total
economic value generated by an ecosystem service, is the sum of use values
and non-use values. Moreover, both use and non-use can be divided further into
various types (see the “Learn More” section at the end of the section).
Box 3. Different types of values. Investigating the types of values that an ecosystem service
helps create can increase understanding of what is valued and also affect which valuation
method is most appropriate.
Words, scores, physical units, or monetary units?

When you have an overview of the aspects explained above, it may be appropriate
to start thinking in detail about how you can proceed with measuring the value.
A number of possible groups of valuation methods are available:
• Qualitative valuation: Value is expressed in words.

• Semi-quantitative valuation: Value is expressed in some form of score or
grading scale.
• Quantitative valuation: The value is expressed in a physical unit, such as the
area of a particular habitat type, number of expected visits to an area, the
quantity of certain goods that can be produced, etc.
• Monetary valuation: Value is expressed in monetary units.
The selection of the valuation method can be governed, for example, by; a) what
you want to use the valuation for; b) what resources for the analysis are available;

and c) if there are available indicators for the service(s) you want to value.
Furthermore, monetary valuation can sometimes be difficult to do when it comes
to the total availability of an ecosystem service and not the valuation of a change.
Valuation of the total availability of an ecosystem service entails an estimate of the
total value of one or more existing ecosystem services at a specific place. A valua-
tion of a change is based on estimating the value of the change in the provision of
the ecosystem service–as a result of a project, plan, or policy. This is an important
distinction to make, both to better define what is valued and because it can affect
the conditions for a valuation in monetary terms. Monetary valuation can be
problematic to use when it comes to valuing the aggregated supply of ecosystem
services because the underlying theory is based on valuing (rather small) changes.
The next section provides additional details on these valuation methods. Some-
times it may be appropriate to use a combination of different methods to describe
the value of a certain ecosystem service. At other times different methods are
needed for different ecosystem services in the very same study.
Summarise your starting points

A good approach can be to summarise the starting points for valuation in an
overview table for each ecosystem service. Table 3 illustrates this.
Table 3. Summarise the starting points for valuation according to this type of table.
Ecosystem Direct or If indirect, Activities/ Type of values How should the

service indirect what direct benefits/goods value be measured?
service? services does generated or
it lead to? affected (For example, (Qualitatively,
use or exist- semi-quantitatively,
ence values?) quantitatively, or
monetary?)
EST 1
EST 2
EST 3

LEARN MORE: VALUE CREATION CHAIN
AND VALUES, STRUCTURING THE ANALYSIS
The line of reasoning about the chain of indirect services (direct services
– benefit – value) is noted in the United Kingdom’s National Ecosystem Assess-
ment (UK NEA, Chapter 2) as well as in a scientific article by Boyd & Banzhaf:
UK NEA, 2011. UK National Ecosystem Assessment – Understanding nature’s value to
society. Technical report. Chapter 2: Conceptual Framework and Methodology.
Boyd, J., Banzhaf, S., 2007. What are ecosystem services? The need for standardized
environmental accounting units. Ecological Economics 63: 616–626.
____
Different types of values are discussed, including in SOU 2013:68.
SOU 2013, 2013. Making the value of ecosystem services visible. Proposals to enhance
well-being through biodiversity & ecosystem services. Swedish Government Inquiries. English
Summary of SOU 2013:68.

Step 5. Apply valuation methods
1 What are you going to use the valuation for? • All methods have
their pros and cons.

• Consider supplemen-
ting with a “worst
case” and “best

case” approach.
• Future changes in the
surrounding world can
4 Determine starting points for the valuation affect the value of an

ecosystem service.
5
• A solid valuation study
Apply valuation method(s) takes time and requi-
res resources. Reflect
6
on which aspects are
Do a review most important for
you to study.
This section discusses some possible methods for measuring the value of eco-
system services. Step 4 demonstrated that the value can be expressed:
• by means of words (qualitatively),

• by means of scoring (semi-quantitatively),
• in the form of various physical units (quantitatively), or
• in monetary terms.
A monetary valuation is not necessarily more informative than, for example, a qual-
itative or quantitative valuation. However, a monetary valuation can make matters
easier when comparison of trade-offs is to be made between costs and benefits. In
some cases, market prices can be the basis for monetary comparison. In many cases,
however, the value of the ecosystem service is not visible in any specific market – or
only a certain component of the value is visible. For example, the ability of the
ecosystem to produce raw materials can be valued through production values, but a
functioning ecosystem also provides many other benefits.
There are uncertainties in all valuation studies. Furthermore, the valuation of
ecosystem services is an area that often involves a relatively long-time perspective.
Therefore, give some thought to the following:
• It is relevant to not only express the most likely outcome. Use a “worst case”
and “best case” approach as well.
• It is relevant to reflect on how the world around us is changing. An ecosys-
tem service can be extensive or functioning well today, for example, but may be
expected to become scarcer in the future. This should be reflected in its value.

Qualitative valuation
There are many ways to describe a value in qualitative terms. The purpose of
qualitative valuation is to provide a more in-depth understanding of the value
without necessarily linking it to any particular measurement. Examples of aspects
that can be studied are:
• What the public thinks about a certain environmental issue.

• How an area is used and how people feel about the area.
• What various experts or the literature says about the relationships in the
ecosystems that deliver particular ecosystem services.
Methods for this kind of valuation can be:

• In-depth ecological surveys. For example, this can involve a more thorough
investigation of how much various indirect ecosystem services are affected by
development or a certain environmental improvement measure.
• Contact with interested parties. Focus groups, in-depth interviews, and ques-
tionnaire studies can provide information about how different areas tend to
be used, for example, or which natural values are considered to be particular-
ly important.
• Description of values based on stories or historical events. A story, a set of
quotes, or the like can show how individuals value various ecosystem services.
TWO EXAMPLES OF QUALITATIVE VALUATION
In a 2014 study in Gothenburg, a test group consisting of 200 teachers and

technology students were shown photos of different urban environments while
listening to various bird sounds. The study showed that urban environments
were perceived as more positive with bird sounds. Songs and sounds from a
combination of the willow warbler, chaffinch, blue tit, European robin, great tit,
blackbird, and great spotted woodpecker ranked highest in the test group.
This result is a form of qualitative valuation of habitats for birds in the urban
environment.
Hedman, M., Heyman, E., Antonsson, H., Gunnarson, B., 2014. Bird song diversity influences
young people’s appreciation of urban landscapes. Urban Forestry and Urban Greening 13 (3):
469-474.
The Nedre Dalälven River, from its mouth up to the Älvkarleby Falls, has histo-
rically constituted one of the most important salmon fishing areas in Sweden.
The town of Älvkarleby is strongly associated with salmon fishing, which can be
exemplified by the name of a local restaurant – Salmon Restaurant and Pizzeria.
It is easy to conclude that salmon fishing in Älvkarleby carries great cultural
values and is an expression of local identity.
Box 4. Qualitative valuation can take different forms.

Semi-quantitative valuation
This type of method is based on quantifying values by assigning them points.
This is often done as a desktop study, but scoring can be derived from information
based on discussions with stakeholders and other experts, for example, or field
studies of species compositions and the use of an area.
The starting point for semi-quantitative methods is some type of scale, such as
a score from −5 to + 5, or from great negative impact to large positive impact,
and so on. Using such an assessment, it is possible, for example, to rank the
importance of various ecosystem services to people or the degree of importance
of the ecosystem services in terms of who is affected the most and the least by a
particular project.
An important aspect in semi-quantitative valuation is to affix the scale to some
reasonable framework. It should be possible to understand what is meant by a
score of “5” or “3” or “low impact” so that the analysis is transparent. See the
example in the next chapter about the treatment of contaminated land and the
example of tourism and recreation by the sea for a few illustrations of the method.
Quantitative valuation
Quantitative valuation means that the value of an ecosystem service is described
using one or more indicators for the service. The idea is that some measurable
aspects of the environment, or our use of it, can reasonably reflect the contribu-
tions of different ecosystem services to our well-being. For example, a particular
area of a particular habitat type may be a good starting point for valuing the ser-
vices generated by that habitat type. Furthermore, the number of visits to an area
that is used for recreation can be an indicator of recreational value. A starting
point for the selection of indicators is provided, for example, by the EU work with
the mapping and analysis of ecosystem services (MAES) (see suggested literature at
the end of this section). Feel free to use this, but also try to be creative. Indicators
can be of different types. Three possible indicator types are listed below:
• Complete indicator – matches the ecosystem service well. For example, carbon
dioxide absorption from a wooded area can be a good indicator of the con-
tribution of the area to global climate regulation.
• Partial indicator – measures a part of an ecosystem service, but not all of it.
For example, the number of visits to a recreational area may be an indicator
of its aesthetic values, but it is also possible that the aesthetic values can
change without this being reflected in the number of visits.
• Directional indicator – a change in the indicator is not proportional to
the change in the ecosystem service but can be used to predict whether the
ecosystem service will increase or decrease. For example, the amount of dead
hardwood could be an indicator of the availability of habitat for the white-
backed woodpecker. If the amount of dead hardwood decreases, this can also be

expected to have a negative impact on the living conditions of the white-backed
woodpecker, but the exact magnitude of the impact can be difficult to predict.
The choice of indicators can be tricky, but if you can find good indicators for a
particular service, you will potentially be able to describe the scope of a change in
the extent of an ecosystem service or its current state.
Often modelling can be useful in quantitative valuation. For example, given
different types of land use, a model can be used to describe the amount of air pol-
lution a particular activity generates; how different environmental quality levels
affect the occurrence of different species; the effects of an increase in temperature
on vegetation; or the risk profile for flooding. Feel free to investigate existing
models that are available and what you can learn from their past applications.
See the suggested literature at the end of the section for a few references.
Monetary valuation
Monetary valuation entails measuring the value of an ecosystem service in mone-
tary units. Such a valuation can be used, for example, as the basis for considering
socio-economic consideration of trade-offs between costs and benefits of an
environmental action, or to determine what a reasonable level of an environment
tax or subsidy might be. Furthermore, a monetary valuation can be practical from
a communications perspective.
The basis for monetary valuation is that people make trade-offs between
different things that create well-being. For example, individuals are often willing
to make economic sacrifices to have access to good environmental quality for
themselves or so that others will. This is reflected, for example, in property prices
located near beautiful natural settings, costs spent on trips to such areas, voluntary
contributions to environmental organisations, or willingness to pay more for
organic products.
Here are two main groups of methods for monetary valuation:

• Scenario valuation methods (Stated Preferences): Often based on presenting
different hypothetical scenarios to respondents in a survey, in which they
are asked to indicate their willingness to pay for achieving the scenarios
described (see the example about mosquitoes in the next chapter)
• Market data methods (Revealed Preferences): Based on studying the rela-
tionships between ecosystems and actual behaviours, prices, and production,
such as:
– The contribution of an ecosystem service to the production of, for exam-
ple, fish or timber (see the example about plaice in the next chapter).
– The role of the natural environment in pricing of properties.
– Environmental quality’s influence on the choice of destinations for outdoor
activities.

– Actual expenditures for protection from contaminated water, noise, flood-
ing, etc.13
Sometimes the value transfer method is used to provide an approximate valuation

of an ecosystem service. This method is based on attempting to generalise a value
from a study done in another geographical place. However, values are often
site-specific, requiring special methods for the transfer. Furthermore, you must
ultimately accept the knowledge that the value is associated with considerable
uncertainty. See the example about the value of water quality improvements in
Sweden in the next chapter for a more detailed description.
A form of value transfer also takes place when you make use of standardized
values for a certain type of environmental impact. These are convenient to use,
but they involve uncertainties as well. There are several handbooks and textbooks
on monetary valuation, both in a Swedish and international context. A few of
these are mentioned in the literature list at the end of this section.
Relatively extensive preparatory work is often required to place a monetary
value on ecosystem services. For example, it is necessary to describe the anticipated
impacts of a particular project on environmental quality or various ecosystem
services. This is a valuation per se, which can be a valuable process in itself.
Accordingly, it is not just the resulting value that is interesting when a monetary
valuation study is conducted.
13 Using costs to estimate benefits, however, can be problematic; for example, see the
discussion in SGU, 2014 (beginning on p. 23).

LEARN MORE:
VALUATION METHODS
A general review of valuation methods is provided in SOU 2013:68, Appendix 2.

SOU 2013:68 2013. Making the value of ecosystem services visible. Proposals to enhance
well-being through biodiversity & ecosystem services. Swedish Government Inquiries. English
summary of SOU 2013:68.13
____
Regarding possible indicators for various ecosystem services, such as for use in
quantitative valuation, a European Union working team (MAES) has developed a
broad analytical framework:
European Commission, 2014. Mapping and Assessment of Ecosystems and their Services
– Indicators for ecosystem assessments under Action 5 of the EU Biodiversity Strategy to
2020. 2nd Report – Final, February 2014.
Freeman, A.M., III., 2003. The Measurement of Environmental and Resource Values. Theory
and Methods. 2nd Edition. Resources for the Future, Washington.
____
For standard values – that is, standardised values in monetary units of environ-
mental effects of various kinds – the following literature is relevant to Sweden:
Noring, Marie, 2014. Ecovalue. An updated set of valuation factors for environmental systems
analysis tools. Included in the dissertation “Valuing ecosystem services – linking ecology and
policy. Royal Institute of Technology. School of Architecture and Built environment.14
____
For discussion about modelling as a tool in the valuation of ecosystem services,
see for example:
COWI, 2015. Support Policy Development for Integration of Ecosystem Service Assessments
into WFD and FD Implementation. Resource Document, January 2014. (see pp. 67–68 on
modelling)
1415
14 https://www.regeringen.se/49bba7/contentassets/ba53cd9f18b74f348eb0ff31e8280d60/
engelsk-version-sammanfattning-av-sou-201368
15 http://www.diva-portal.org/smash/get/diva2:763108/FULLTEXT01.pdf

Step 6. Do a review
1 What are you going to use the valuation for?
5 Apply valuation method(s) • Conclude the analysis

by putting the valua-
6
tion in context.
Do a review
When the valuation is completed, a final review is needed. The purpose of the
review is to put the results in their context, and it may be relevant to consider the
following questions:
• What uncertainties exist in the valuations that have been made?

• If the scope of an analysis was limited in step 3, how do the values produced
in step 5 relate to the overall picture of all ecosystem services
identified in step 2? Have the most important values been captured?
• Do the results provide a sufficient basis for decisions, or are additional
studies necessary?
• Do the results provide answers to the questions that the analysis aimed to
answer?
• How will the results be used in relation to overall policy objectives or
economic goals for businesses?
• What has been detected using the ecosystem service perspective and what
has not been detected? For example, bear in mind that the ecosystem services
perspective is usually not sufficient to capture all relevant environmental
impacts. Non-biological relationships, such as the importance of ground-
water for land stability16 and the importance of water flows for energy
extraction, are usually outside the scope of such a valuation.
16 See SGU, 2014, for a review of groundwater services.

An additional step that may be relevant is to follow up on the results after a
project. Doing this requires a plan. Consider how the results can be followed up;
what is measurable and what action can be taken, given various possible scenarios
for the evolution of ecosystem services over time?

Practical examples
A number of practical examples of ecosystem services valuation are presented
in this section. The examples are derived from valuations in various Swedish
contexts and cover different aims, types of activity, and environmental aspects.
In addition, the selection represents geographical variations, including both urban
and rural contexts. References to the valuation guide’s six steps for valuation
are made throughout the section. The examples cover some of the steps in more
detail, others more briefly, and some not at all. Each of the examples begins with
a presentation of the valuation that has been made and then discusses how the
valuations link with the various steps of the guide.
The selection of examples has been governed by the desire to illustrate and put
into concrete form the step-by-step method of valuation that the guide describes.
This means that other aspects that may also be important for the valuation of
ecosystem services are not discussed here. Such aspects could include existing
instruments and processes within municipalities and companies, the actors that
should be involved in a valuation of ecosystem services, and what the interaction
between various competencies is like.
All nine examples are summarised below:
C/O City – ecosystem services in urban planning

The aim of the C/O City project is to create concrete solutions for the use of the
ecosystem services concept in urban development. Among other things, the project
has produced a guide that describes a step-by-step work process for integrating
urban ecosystem services in the planning process. The purpose is to increase
consideration of the importance of ecosystem services by integrating them into
in-depth physical planning, detailed local plans, and so on.
Lomma municipality – ecosystem services in detailed local planning

Lomma municipality has decided that the balancing principle of ecosystem
services will apply in all planning and development. This means that if ecosystem
services values can be lost, environmental compensation will be made to the
greatest extent possible. These political decisions have been made after realising
that loss of ecosystem services will incur costs in the future if land continues to
be exploited at the current pace. An example is the detailed physical plan for an
area in the municipality, that was prepared as a concrete way of taking ecosystem
services into account.

Saltå Kvarn – a toolbox for ecosystem services in the cultural landscape
Saltå Kvarn has long worked with a “toolbox” of measures in the cultural land-
scape aimed at achieving a sustainable working method in the supply chain and
a reduced burden on the environment. The method is based on the principle of
voluntariness – that is, grain suppliers that choose to implement measures on the
farm in keeping with the “toolbox”, receive points and are thereby paid more for
their grain. These measures often have a direct effect on ecosystem services.
Riksbyggen
– a tool for the evaluation of ecosystem services in the construction sector
Riksbyggen uses a scoring system with what are called eco-points to value the
effect of new construction on ecosystem services. A number of suggestions for
activities that can be implemented to preserve, strengthen, or compensate for
various ecosystem services are also included. This example shows how valuation
of ecosystem services can be integrated into the daily work of a company.
NCC – an analysis of ecosystem services at the company’s headquarters

NCC has developed a method for analysing important ecosystem services at an
early stage of the construction process. This method is being applied to devel-
opment of the new headquarters in the Järva Krog district in Stockholm. NCC’s
overall objective is to base the building designs on existing ecosystem services.
Therefore, NCC has mapped the ecosystem services in the area.
Sveaskog – markets for ecosystem services

This example is about markets for ecosystem services. Some activities that
have a negative impact on natural areas today encounter legal requirements to
provide compensation, known as ecological compensation, for the values that
are destroyed. This creates new business opportunities for landowners who can
restore and protect valuable habitats and then sell them as compensation to
companies that have a demand for this. Sveaskog sees an opportunity to offer this
service.
Good marine environment

– the importance of ecosystem services for tourism and recreation
The Swedish Agency for Marine and Water Management has analysed the crea-
tion of recreational benefits if a good environmental status of the sea is attained.
The analysis is based on an inventory of the relationships among ecosystem ser-
vices and shows the many dependencies that exist among recreation and indirect
ecosystem services. The valuation is mainly conducted with a semi-quantitative
model in which benefits are assigned points.

After-treatment of contaminated land – the impact on ecosystem services
The effects of different options for the after-treatment of contaminated soil at
the Fixfabriken factory in Gothenburg are studied by means of ecosystem service
valuation. The study could also serve as the basis for setting priorities in land
remediation decisions and is based on a semi-quantitative valuation. The study
shows how broad mapping along with a relatively rudimentary valuation can
provide a sufficient starting point for decisions on land use.

– the value of ecosystem services in monetary terms
Through four different examples from the valuation literature, this example shows
how monetary valuation of ecosystem services can be done, and how such results
can be of practical use. For example, benefits that are expressed in monetary units
are weighed against costs for projects that increase the supply of ecosystem servic-
es. Monetary valuations can also be eye-openers that put the focus on important
ecosystem services.

C/O City – ecosystem services in urban planning
The C/O City project aims to make the value of ecosystem services visible in urban
development. The project goal has been to identify and quantify urban ecosystem
services, develop planning and follow-up tools, and generate data for correlation
between urban ecosystem services and resilience. The project has been funded by
Vinnova, Sweden’s innovation agency, and is a collaboration among the cities of
Stockholm and Malmö, NCC, SP, White Architects, WSP, U&We, Albaeco, Esam,
and Ecokultur.
The results of the various subprojects are presented on the project home page,17
including “Green space factors for urban districts”; “Ecosystem services in urban
planning – a guide”; “Quantification and valuation of ecosystem services”; and
“Indicators for ecosystem services”. The report “Urban ecosystem services: Let
nature do the work”18 summarises the results of the project as a whole. The main
focus of this example is on “Ecosystem services in urban planning – a guide.”19
There are many more results to take note of on the project’s home page for those
interested.
The guide on ecosystem services in urban planning describes a step-by-step pro-
cess for integrating urban ecosystem services into the planning process. The over-
all field of application is the integration of ecosystem services in urban planning
– for example, in master development plans, plan programmes, in-depth physical
plans, and local development plans. Briefly, the work process is comprised of
identifying, assessing, and executing and means that different types of questions
are asked for each ecosystem service and planning level. The guide states that the
questions are not carved in stone and can be further adapted depending on what
local conditions prevail in a specific place.
Identify. This step involves identifying what ecosystem services exist in an area
and those that are missing. It also means that users of the ecosystem services
should be identified. This can be done in different ways. For example, for a master
development plan both investigations and meetings for discussions with interested
parties may be required. For a simpler local development plan it may suffice to
conduct workshops, bring together groups with representatives from the various
municipality administrations, and include questions about ecosystem services in
the assessment of needs for the project.
Assess. The idea behind assessing is to compare the results of the identification
of ecosystem services with the planned development of a given area. In the guide,
it is suggested to base this step on the following four considerations: create,
protect, strengthen, and skip. Create means that ecosystem services do not exist
17 C/O City, 2015.

18 C/O City, 2014a.
19 C/O City, 2014b.

today, but there is a need to create them; protect means that ecosystem services are
available today, but they need to be protected in anticipation of future changes;
strengthen means that ecosystem services are available but not to a satisfactory
degree. Finally, skip refers to consideration of the trade-offs that may need to be
made against other interests in an area, which means that it might not be possible
to preserve a certain ecosystem service.
The main recommendation of the guide is to focus on ecosystem services with
“potential” and that people rely on. It also states that the valuation of ecosystem
services is important to uphold their importance. A number of questions are sug-
gested to facilitate the assessment, including:
1) Which ecosystem services are of greatest importance?

2) What is the result of a SWOT analysis (Strengths Weaknesses Opportunities
Threats)?
3) Are there conflicts between different levels of ambition in the urban develop-
ment?
4) Is there an analysis of the consequences of impacts on socio-economic values?
Execute. The guide explains how the results of the assessment and valuation are
to be implemented in the planning documents, contracts, practical implementa-
tion, and administration. Early dialogue processes are described as important in
creating common goals and gaining support for decisions. A concrete example of
what successful implementation may lead to is formation of cooperatives for the
management of a particular area.
Regarding more precise valuation, the guide clearly states that urban ecosystem
services are to be valued. Some ecosystem services are perceived as being more
important in urban areas, such as the purification of water, shade from trees,
recreational areas and playgrounds. Urban inhabitants regard cultural services
as particularly important, even though indirect ecosystem services such as soil
formation and habitats for species are also mentioned. The valuation of ecosystem
services does not need to be monetary, but can be qualitative or quantitative, using
indicators. According to C/O City, examples of aspects that can and should be
quantified are:
• How many cubic metres of surface water runoff can a park handle?
• How much carbon dioxide do the city’s trees sequester?
• How many plant and animal species live on a roof planted with vegetation?
• How many kilos of air pollutants can an avenue with trees clean?
• How many decibels of noise in a district can vegetation reduce?

Table 4. Indicators of ecosystem services.
CBI Indicator Ecosystem service Method for follow-up Indikatorer

function at district level
Adaptation of CBI’s Access to nature for Sociotope maps, park programme, CBI, adapted indicator 133
indicator 13 at the recreation or the eight park qualities
district level
Adaptation of Access and visits to – The “Environment and envi- – Access to bathing beach**
CBI’s indicator 13 parks and nature ronmental habits in Stockholm” – Access to parks and nature***
indicator at the citizen survey from the Stockholm
district level Environment & Health Protection – Visits to parks or nature areas****
Administration – Visits to parks or nature areas*****
– Analysis of actual walking
distance*
Adaptation of CBI’s Budget dedicated to Mapping Budget dedicated to biodiversity

indicator 15 at the green solutions****** (in monetary units)
Project codes for time tracking can
district level be used to calculate the budget
SOURCE: C/O CITY, 2014c
* Distance from residential address through streets and footpaths to the green area point of entry. The analysis is based on the park programme and
the City of Stockholm sociotope map.
** Percentage of residents satisfied with access to the beach in their district
*** Percentage of residents who are very or rather satisfied with access to parks and nature areas in their district
**** Percentage spending time in parks/nature areas near their residence more than once a week during the six warmer months
***** Percentage having access to a green area within 300 or 200 metres of their residence
****** For example, surface water solutions, noise abatement, parks, and other green areas
In the C/O City project, indicators have been developed to facilitate the planning
of ecosystem services.20 To be more specific, the project has used the Cities Biodi-
versity Index (CBI), which is a follow-up method for biodiversity at the city level
used by several cities, including Brussels, Curitiba, and Stockholm. Table 4 shows
how follow-up of the ecosystem service function of “access to and visits in park
and nature” can be done using a number of indicators, namely:
1) Access to the beach – measured as the percentage of residents who are satis-
fied with access to the beach in their district,
2) Access to parks and nature – measured as the percentage of residents who are
very or rather satisfied with the access to parks and nature areas in their district,
3) Visits to parks or nature areas – measured by the percentage of people
spending time in parks/nature areas near their residence more than once a
week during the six warmer months of the year.
4) Visits to parks or nature areas – measured by the percentage of people
spending time in a park or nature area near their residence more than once
a week during the six warmer months of the year or the percentage having
access to a green area within 300 or 200 metres of their residence.
20 C/O City, 2014c.

Methods for follow-up include the use of the citizen survey “Environment and
environmental habits in Stockholm”21 and analysis of actual walking distances.
DISCUSSION
The C/O guide to ecosystem services in urban planning illustrates, in varying
degrees, all the stages of valuation described in this guide on valuation of ecosys-
tem services. The purpose of the valuation (step 1) is to uphold the importance
of ecosystem services and to integrate them into municipal planning (in-depth
development plans, master development plans, local development plans, etc.). The
first three considerations in the assessment steps of the guide to ecosystem services
in urban planning (create, protect, and strengthen) are covered in this valuation
guide by identification step (step 2). As suggested in the guide, identification
could be extended by also asking the question, “How does the ecosystem service
creates benefits?” This is to not only make the point that ecosystem services are
important for people, but to also show how they are important. Such information
is valuable for the continued analysis of the value of ecosystem services, especially
if the aim is to integrate such values in an analysis of the consequences of the
project on socio-economic values. The guide explains that the focus should be
on the ecosystem services that we are dependent upon and that are potentially
important in the area. That is to say, in the identification stage a prioritisation is
made by focussing on those ecosystem services that give the greatest benefit to
people and are therefore a type of valuation. Although indirect ecosystem services
such as soil formation are mentioned, there is a risk that these will be overlooked.
Another indication of how the identification of ecosystem services should be done
is the statement that this should be based on the ecosystem services and not on the
“ambitions for the exploitation”.
The fourth consideration, “skip”, relates to limiting the scope of the analysis,
the third step of the valuation guide. The” skip” consideration represents a form
of valuation because it is clear that considerations of trade-offs are made that
may mean that other interests prevail over ecosystem services in a given area.
To determine what would be a wise trade-off from a socio-economic perspective,
these other interests in an area need to be made clear. The statement in the guide
that “ecosystems never affect us as much as when they have a direct impact on
human health and our well-being” makes it obvious that a clear starting point
for valuation is to focus on direct ecosystem services. Thus, there is a risk that
not enough consideration will be given to the indirect ecosystem services with
importance to people in the city, such as soil formation. Based on the factors listed
in step 3 of the valuation guide, limiting the scope of the analysis should be based
on local priorities and the stakeholders that are affected. On a more general level,
21 The Environmental Barometer, 2013.

a very first limitation of the scope of the analysis takes place through a clear focus
on urban ecosystem services, which corresponds to the priority factor type of
ecosystem service.
Important starting points for valuation that are proposed in the guide (step 4)
are a focus on direct ecosystem services, include both total estimates, that is, the
identification of existing ecosystem services in an area, and estimates of changes in
the ecosystem services using indicators.
The valuation of ecosystem services (step 5), done within the framework for
C/O City, is qualitative and to some extent also quantitative by applying indica-
tors for biodiversity (CBI, Cities Biodiversity Index) that can be followed up.
Step 6 of the valuation guide calls for a final review when the valuation has
been done, to place the results into their context. The C/O City guide provides
support on a general level for how ecosystem services can be integrated into urban
planning. However, an actual valuation of ecosystem services for a real area was
not carried out. (The C/O City sub-project on indicators describes how valuation
can be done, but this project is on a more general level). In retrospect, the review
for the case study C/O City is not based on concrete valuation results but is more
about describing the proposals made for further studies. It is proposed, for exam-
ple, that a socio-economic analysis be carried out that considers ecosystem servic-
es, at least in the development of master development plans, in-depth development
plans, and local development plans. Also mentioned is that it may be necessary
to think about how “other economic valuations” can be made. What is meant by
“other” is not entirely clear, but it may presumably refer to methods that are not
based on monetary valuations.
Another type of proposed analysis is cost-effectiveness analysis to enable com-
parisons of ecosystem solutions with technical solutions. Multi-criteria decision
analysis is also described as a possible method. Finally, it is worth mentioning
that within the framework of the C/O City project, reviews are conducted on an
on-going basis. For example, the planning policy tool for A Green Space Factor is
followed up annually in the follow-ups of sustainability requirements and sustain-
ability reports, as well as in the project’s monthly reports.

Lomma municipality – ecosystem services in local planning
This example is about a local land-use plan that Lomma municipality in Skåne
County has made for an area in southeastern Lomma,, which has concretely taken
into account ecosystem services with the help of checklists and tables.22
Lomma municipality has decided that the balancing principle for ecosystem
services will apply in all planning and development. This means that if ecosystem
service values may be lost, environmental compensation must be made to the
greatest extent possible. A result of the discussion about the management of this
policy has meant that the area of protected land will be doubled in the period
2012–2108. These political decisions have been made after realising that loss of
ecosystem services will incur costs in the future if land continues to be exploited at
the present rate.
Southwestern Skåne is a region with severe development pressures and a land-
scape with many lost ecosystem services. This is seen by repeated severe flooding
and deteriorating organic matter in soils. Skåne has the least amount of land with
public access in Sweden and an increasing number of threatened species. To start
work on restoring some of these problems, the municipality’s master development
plan included work with ecosystem services at the landscape level in 2007. Spe-
cifically, maps were developed to illustrate future land and water use, including
flood areas, future water reservoirs, possible areas to be used for compensation
measures, need for additional ecological corridors, zoning to give precedence to
some ecosystem services, and so on.
The implications of the municipality’s work with compensation of ecosystem
services is that before creating a local development plan or project, the active eco-
system services at a site will be assessed. To support this assessment, the munici-
pality has developed checklists and tables to provide information about ecosystem
services that are important at the site today, which services have disappeared, and
which services are lacking. In addition, an assessment will be made of what rea-
sonable future use/potential a site could have. If there are plans to develop a site,
it is necessary to ask if the site has future potential, such as a flood area or city
park, and not just as the content poor lawn it first appears to be. In the master
development plan, the areas with the highest values also have been excluded from
possible development at an early stage, in keeping with the balancing principle.
The cost of compensation is then charged to the project and may be withdrawn
upon sale of the land, by agreement, or through other internal funding. A detailed
description of how the values are to be replaced or compensated must exist before
a building permit is issued or exploitation takes place. The description must be
approved by the environmental strategist or other official with ecological exper-
22 Lomma municipality, 2014

PHOTO: CHRISTIAN ALMSTRÖM
In Lomma municipality an assessment of the site’s ecosystem services is done before every
local development plan or development project is approved. A site earmarked for exploitation
may seem to be a content-poor space but may have future potential – as a flood area, for
example. The street pictured is Vattenverksgatan in Lomma.
tise. Compensation can sometime take place through an increase in the natural
values in the area or in another place, connecting areas for greater ecological or
recreational utility, or through designing buildings so that infiltration of water or
green areas is not reduced.
The local development plan relates to an area in southeastern Lomma that
encompasses about 7,000 square metres and is owned by the municipality. The
aim of the plan is to test the appropriateness of enabling the development of
housing, technical facilities, parks, and main and local streets within the planning
area. The proposal calls for retaining the existing playground in the northern part
of the plan area. According to the local development plan, there are no major
natural values in the area, and it mainly consists of parkland/lawn used mostly
for recreation. The existing natural values are associated with the meadow in the
middle of the area and ash trees growing on the site. Ash is a threatened tree, and
its numbers have been greatly reduced in the landscape because of ash dieback
disease.
The effect the plan proposal is expected to have on the area’s values has been
assessed. Under consideration are ecological values (the plan proposal involves
the development of about 2,300 square metres of lawn and meadowland with
valuable broadleaved trees) and recreational values (playground, area for exercis-
ing dogs). To identify the recreational values, questions are posed about how the
area is used and the recreational functions it serves. Regarding other ecosystem
services, it has been stated that the lawn area and meadow that are being removed

Figure 3. Ecosystem service assessment in the detailed local plan for Lomma.
Subsections Values Before After Impact of Potential Quantify Proposals for action Compen-
proposal values of impact sated
keeping on area
Fill in at
situation
later stage
intact
1,3 Biodiversity Low Remains
Recreational values Open area, space Remains
Other ecosystem Infiltration area Remains

services
2 Biodiversity Deciduous hedge, Remains

low values
Recreational values Space creation, Remains

seclusion, play
Other ecosystem Infiltration area, air Remains

services purification, trees,
microclimate
4 Biodiversity Low Removed Need not be compen-

sated.
Recreational values Open area, space, park Removed Parts of these functions
feeling, meeting place/ may be moved to
dog exercise area another place. The
same people will not
benefit from the com-
pensation.
Other ecosystem Infiltration area Removed Replaced with infiltra-

services tion area/surface water
system on site/other site
5 Biodiversity Meadowland, dry/fresh Removed New meadowland of

meadow with relatively the same size is to be
low/medium species established in another
values. Floral resources. place.
SOURCE: LOMMA MUNICIPALITY, 2014
provide infiltration of rainwater. Because the plan calls for building on or paving
this area, there is a risk that this function will be lost. Another loss of ecosystem
services occurs if trees are removed, resulting in reduced contributions to the
microclimate and air purification. The identification of ecosystem services is
supported by the final report from the Swedish Environmental Protection Agency’s
government remit to compile information about important ecosystems and eco-
system services in Sweden.23
Figure 3 is an excerpt from the local development plan that shows how the
values in the subsections of the plan area have been identified both before and
after implementation of the contemplated plan. It also provides suggestions for
23 Swedish Environmental Protection Agency, 2012.

compensatory measures in cases where the values are expected to be lost, such as
planting living plants on the roofs of planned buildings to compensate for loss of
infiltration capacity and certain biological values linked to grassy areas; managing
runoff, such as that between buildings, using species that tolerate damp ground;
and the design of new meadow environments and planting of trees. However, it is
believed that the values lost can be compensated to only a certain extent. Because
the plan did not show how the area would look after it was developed, a detailed
plan for compensation could not be presented. On the other hand, it was noted
that recreational values cannot be offset within the plan area but will have to
move to another location, which in practice means that these values will flow to
other people than it does today.
DISCUSSION
The municipality’s decision to apply the balancing policy to all planning and
development is the basis for the work that is now under way to integrate the
importance of ecosystem services and to propose compensatory measures if
necessary. The purpose of ecosystem services valuation is long-term sustainable
development in a part of Sweden with large losses of ecosystem services. To be
more precise, the valuation is used in the municipality’s master development plans
and local development plans (step 1).
Ecosystem services are identified (step 2) in the exemplified local development
plan, but the plan does not indicate more precisely how the selection of ecosystem
services in the area in question was made or which ecosystem services were
not included. Regarding recreational values, the local development plan poses
questions about how the area is used and what recreational functions it serves. In
the local development plan, there is no detailed information about use of the area
and which groups in the community are affected, but from the compilation it is
obvious that recreational values are deemed great and that they will be lost if the
plan becomes reality.
Limiting the scope of the analysis of ecosystem services is based on local pri-
orities (step 3). The starting point for the valuation (step 4) is that a change in the
supply (impact) of ecosystem services is described, as well as how compensation
can be made for a negative impact. The valuation that is done (step 5) is entirely
qualitative and is described in words. A review of the example (step 6) shows
that the underlying political decision has been of great importance in the practical
integration of ecosystem services into the wok of the municipality with plans
and development. Without the review, it would not have been so obvious that
an apparently low-value grassy area could harbour such important recreational
values.

Saltå Kvarn – a toolbox for action in the cultural landscape
PHOTO: JENNIFER KEY/SALTÅ KVARN

Saltå Kvarn’s grain suppliers choose to implement actions at the farm level in accordance
with the “toolbox”, when actions impact ecosystem services. Pictured here is a farm in
Södermanland county by Nykyrka Lida 1.
Saltå Kvarn AB is an organic food company with a turnover of 5,550 tonnes of

grain and approximately SEK 155 million annually. The company operates two
bakeries and a mill.
Saltå Kvarn makes demands on its cereal suppliers, including the requirement
that cultivations must be certified and approved according to the rules of KRAV,
the organisation that oversees organic labelling standards, and that priority be
given to purchases from organic ecocycle farms. These requirements are also a
starting point for a toolbox that Saltå Kvarn has developed to bring about agri-
culture that places less of a burden on the environment. The method is based on
the idea of planetary boundaries developed by the Stockholm Resilience Centre:
In short, this is about defining boundaries for what the planet can tolerate within
a range of areas (climate, biodiversity, nitrogen and phosphorus cycles, and so on).
The method is based on voluntariness – that is, that grain suppliers choosing to
implement actions on the farm in keeping with the “toolbox” receive points and
are thus paid more for their grain. In 2013, Saltå Kvarn paid up to SEK 0.3/kg for
grain as a bonus to suppliers achieving 1,000 points or more. The point system
is a success in the sense that grain suppliers implement more actions than they
receive compensation for. In other words, money is not the only motivating force
at work. There are 128 actions listed in the toolbox divided into the following

Figure 4. Saltå Kvarn’s toolbox.
Grouping Action Action area Action Specification of action Effect, impact Score Your
no. score
Plant culti- 1 Yield, harvest Choice of variety Priority given to varieties that Output in relation to the 5
vation levels provides even are resistant and provide input. Even harvest over
harvest. even and relatively plentiful time and space produces
harvests. less leaching.
Plant culti- 2 Biodiversity, The proportion of cul- At least 25% of the farm’s Ecosystem services’ 50
vation increased tivated area in relation property consists of natural preconditions for
natural biotopes to the proportion of land (not cultivated land). biodiversity.
natural ecosystems in Neither agriculture nor forestry.
the landscape.
Plant/animal 3 Biodiversity, Study of the farm’s En studie av gårdens marker Påverkar ekosystemt- 100
husbandry increased role and context in är genomförd med hjälp av jänster och biologisk
natural biotopes the ecosystem and relevant kompetens. Studien mångfald.
landscape. ska innehålla förslag till strategi
och åtgärder för att förstärka
ekologiska korridorer och
ekosystem.
Plant/animal 4 Biodiversity, Agroforestry Participation in experiments Builds resilience, emu- 50

husbandry increased with agroforestry. lates natural ecosystems,
natural biotopes promotes biodiversity,
increases carbon
sequestration, reduces
leaching.
Plant culti- 5 Biodiversity, Increase contact Establish an ecological corridor Affects the preconditions 75
vation increased among metapopu- per 20 hectares between for biodiversity.
natural biotopes lations and reduce natural biotopes.
fragmentation.
Plant/animal 6 Biodiversity, Pasture, nature. If conditions allow, create Affects a great variety of 50
husbandry increased For example, forest pasture on the outlying land species. Creates greater
natural biotopes pasturage. made up partly of forest. biodiversity where
At least 15% of the total grazing takes place, but
pasturage. also means somewhat
reduced feed production
on cultivated land.
Plant/animal 7 Biodiversity, Creation of ecological Create tree, shrub and/or grass Promotes habitats and 40
husbandry increased dispersal corridors ridges on at least one out of populations.
natural biotopes (line and point ten fields. A minimum width of
elements). 2 metres for green zones and
6 metres by watercourses can
provide environmental support.
Plant/animal 8 Biodiversity, Variation on the Contribute to increased variety Affects a great variety of 50
husbandry increased landscape level. in the landscape. Enact two of species.
natural biotopes the proposals in the completed
farm study.
KÄLLA: SALTÅ KVARN, 2014
groups; plant cultivation, plant/animal husbandry, animal husbandry, and

energy.24
Figure 4 uses an excerpt from the toolbox to illustrate how points are estab-
lished for different types of actions that suppliers implement.25 Several of
the actions affect ecosystem services, such as action 2 specified in the figure
24 Saltå Kvarn, 2012.

25 Saltå Kvarn, 2014.

(“The proportion of cultivated area in relation to the proportion of natural
ecosystems in the landscape”): “At least 25% of the farm’s property consists of
natural land (not cultivated land), and not either agriculture nor forestry.” The
effect/impact of this measure is described in terms of ecosystem services and the
preconditions for biodiversity and provides 50 points.
Similarly, action 3 (“Study of the farm’s role and context in the ecosystem
and landscape”) affects ecosystem services and biodiversity. The action gives
100 points to grain suppliers who assess the farm’s lands using relevant skills.
DISCUSSION
This example has an indirect connection with the valuation of ecosystem services
and, therefore, the discussion concerns possible ways to further develop the
toolbox to increase its usefulness for the valuation of ecosystem services. First,
it can be noted that the word “ecosystem service(s)” as a type of effect/impact
is mentioned in 6 of the 128 actions. At the same time, a number of the actions
actually have an impact on ecosystem services, even if this is not explicitly stated.
An example of this is action 7 in figure 4 (“creation of ecological dispersal corri-
dors”), which promotes habitats and populations.
The implementation of different types of actions provides various points
totals, which can be interpreted as a semi-quantitative valuation of the impact
of the actions on ecosystem services. Some elaboration would then be needed
with respect to which ecosystem services are affected and to what extent. For the
six actions explicitly stated to affect ecosystem services, the points assigned are
50, 100, 25, 30, 15 and 5. These points say a lot about the type of actions that
are valued most highly, and this could be supplemented by a description of the
reasons for the different points. By supplementing the tool with a more detailed
analysis of the effects of the actions on ecosystem services – what and how? – the
toolbox could be very useful for valuation.

Riksbyggen – a tool for assessing ecosystem services
in the construction sector
This example concerns a tool that the Riksbyggen property management and
construction company and SWECO have developed for the valuation of ecosystem
services with new construction, with the purchase of land and at the forthcoming
sale.26 The tool represents an important basis for decisions by Riksbyggen after
they determined that existing tools for integration of ecosystem services in plan-
ning do not encapsulate the complexity of biodiversity and ecosystem services.
Riksbyggen maintains that rather than providing absolute values, the tool pro-
vides comparative values by measuring fictitious units called “ecopoints”, which
can provide an initial indication of the ecosystem of the land in question and how
people use it. In addition, several activities are also included that Riksbyggen’s
project managers can implement to preserve, strengthen, or compensate for
various ecosystem services. Finally, the development project is analysed as a whole
and compared with the original, undeveloped state of the land. The land cannot
be bought unless measures have been planned that result in a value that is at least
as great as prior to development. In addition, ecosystem services are included as
part of a reward system. To get an extra reward, the development project must
achieve a total of 1,000 more ecopoints than the value prior to development.
Riksbyggen states that the analysis can be carried out quickly and that the work
from a purely practical standpoint takes place through collaboration between the
sustainability unit and the project managers. The tool has been used in more than
50 projects, and Riksbyggen considers it very useful for exemplifying the concept
of ecosystem services.
The ecosystem services included in the tool have been identified based on an
adaptation of the Millennium Ecosystem Assessment.27 In all, the tool encom-
passes 16 different ecosystem services, which have been selected because they are
all urban ecosystem services: arable land, natural resources, fresh water, water
regulation, water purification, microclimate, sequestration of carbon dioxide,
maintenance of air quality, pollination, biological control, prevention of soil
erosion, habitat for species, recreation and aesthetic values, tourism, and cultural
environment values.
When the tool is applied in practice, an assessment is done of the ecosystem
services that are present on an area of land or that have a future potential. An
analysis is also done of the sites within an area that are particularly important for
ecosystem services, such as those related to recreational opportunities or some
particular species. Furthermore, additional priorities are established on a case by
case basis because each project is unique.
26 Sweco, 2012.
27 MEA, 2005.

PHOTO: 02 LANDSKAP
Riksbyggen’s project on Dr. Allards Gata in Gothenburg contains a green area that today is
not very accessible and at the same time is important for recreation.
An example of the application of the tool is illustrated by Riksbyggen’s Brf Viva

project on Dr. Allards Gata in Gothenburg. The land to be developed is described
as centrally located in the Chalmers area, a green wedge in the middle of Gothen-
burg. Access to the green area is rather difficult, but at the same time the area is
important for recreation, and according to Riksbyggen, there is a large amount of
public support for preserving it. Riksbyggen’s analysis using the tool indicates that
in addition to recreational possibilities, the land offers ecosystem services such
as water regulation, sequestration of carbon, and maintenance of air quality. In
addition, the site is important as a habitat for the lesser spotted woodpecker. It is
asserted that development would bring about a loss of the identified values. Figure
5 shows the result of applying the tool to the Brf Viva project in Gothenburg and
how the value after development is increased through implementation of various
types of activities.
The values in the tool have been produced by an individual weighting of eco-
system services based on current needs, likely future needs, and legal requirements.
The idea is that the tool should provide a first indication of the values present in a
land area, but it should be emphasised that relevant expertise must be consulted if
a thorough analysis is required. In the tool,28 it is further explained that if a land
28 Sweco, 2012.

area is given high green ecopoints, this means that the site may be construed as a
sustainable housing environment.
Ecopoints
350
Cultural environment values
300 Tourism
Recreation and aesthetic values
250 Habitat for species
Prevention of soil erosion
Biological control
200
Pollination and seed dispersal
Maintenance of air quality
150
Sequestration of carbon dioxide
Microclimate
100 Water purification
Water regulation
50 Natural resources
Arable land
0
Before development After development
Figure 5. Results before and after development of Riksbyggen’s Brf Viva project in Gothenburg.
SOURCE: RIKSBYGGEN
If Riksbyggen chooses to build on such a site, the advantage is that the natural
conditions for a sustainable environment are favourable: the disadvantage is that
the construction itself results in negative effects on the area and its potential to
maintain ecosystem services. Conversely, low green ecopoints mean that greater
resources would be required to achieve a sustainable environment at the site,
but that the construction itself could contribute to greater sustainability. High
blue ecopoints are obtained if Riksbyggen has a strong possibility of preserving,
strengthening, or compensating for development. Figure 6 is an excerpt from the
Excel tool.
As mentioned earlier, the tool includes a number of activities that Riksbyggen’s
project managers can implement to preserve, strengthen, or compensate for
various ecosystem services. Here are examples of such activities for the ecosystem
services of arable land and fresh water;
Arable land
• Planted roofs
• Garden allotments
• Gardening
• Façade on balconies suitable for cultivation
• Greenhouse on the balcony
• Vertical greenhouse, stand-alone or in façade
• Wastewater can be used along with organic waste to produce biogas

Land area: xxxx CURRENT UTILISATION RIKSBYGGEN’S ACTIVITY
Size: xxxx CONDITION
Type: xxxx
Process stage: xxxx
ECOSYSTEM GUIDING QUESTIONS 1. Is there 2. Is the 3. Is the 4. Is it 5. Is it likely 6. Will availa- 8. Comments
SERVICES potential access service service likely that that access to ble technology
to the service used by used by the service the service will to preserve,
in the area or people people in will be in be affected strengthen, or
nearby? locally? the larger demand in negatively by compensate
environs? the future? Riksbyggen’s for the service
planned be applied at
Respond to the construction construction?
guiding ques- activity?
tions to the left.
If you answer If you answer See supporting
“No”, skip to yes, proceed to documents
question 4. question 6. under the page
“Measures”.
Maintenance 1. Are there in all or part

of air quality of the grounds, trees or
other vegetation that can
filter out the air pollution
from roads?
2. Are there large green/
nature areas (>500 x
500 m) between paved
surfaces that contribute
to air exchange (i.e.,
conditions for urban
breezes)?
Pollination 1. Are nectar-producing

plants grown on all or part
of the land or immediately
adjacent to it?
2. Is there habitat in
the area for valuable
pollinators, such as oaks
and old trees?
Biological 1. Are there valuable

control environments such as
forest edges, ditches,
tree screens, mounds of
stones, avenues, etc.?
Figure 6. Riksbyggen’s tool for the valuation of ecosystem services. SOURCE: RIKSBYGGEN
• Compensatory measures in the district

• Other equivalent measures
Freshwater
• Establishment of wetland
• Avoid materials that release hazardous substances into water (such as copper)
• Reduce the risk of pollution
• Reduce runoff of water over paved surfaces and maximize water flowing
through vegetation
• Construction of ditches along roads and built-up areas
• Local treatment and reuse of grey water
• Other equivalent measures

DISCUSSION
Valuation of ecosystem services is used in connection with the company’s sustaina-
bility efforts (step 1). The starting point is a selection of urban ecosystem services.
Based on these 16 ecosystem services (which consequently are the result of a lim-
iting the scope of ecosystem services, see step 3), the tool can be used to identify
ecosystem services that are available in an area of land or that have future poten-
tial, as well as places that are especially important for ecosystem services (step 2).
The tool also provides some support for assessment of how ecosystem services
create benefits for humankind, such as water regulation that can reduce the risks
of flooding and thereby also the need for infrastructure to manage flooding.29
In the tool, questions are asked about whether ecosystem services are used by
people locally and in the larger environs. This analysis could be made more
in-depth to provide additional information about which groups in society are
affected by construction.
Because the idea of the tool is to assess the provision of ecosystem services
before and after development – that is, the consequences of a project – the eco-
system services that are affected by this change need to be identified. According
to step 2 of the guide, this can be done by asking questions about whether an
ecosystem service is affected by the project, in what way and who benefits or
suffers, as well as how a negative impact can be avoided, minimised, restored, or
compensated for. In Riksbyggen’s Excel tool, these types of questions are posed
explicitly:
• Is it likely that the availability of the service will be adversely affected by

Riksbyggen’s planned construction activity?
• Will available technology to maintain, strengthen, or compensate for the
service be applied at construction?
A starting point for valuation (step 4) is thus a change in the provision of ecosys-
tem services. The tool includes a provision for comparing a description of the cur-
rent state of ecosystem services in an area before development with the situation
after development.
Both direct and indirect ecosystem services are valued by means of the points
system. Additional clarity could be provided by studying the dependencies among
various ecosystem services. This could also reduce the risk of double counting.
However, the idea is that the tool should be easy to use, and that ecological exper-
tise should not be required. An analysis of dependencies among ecosystem services
is something that would probably require additional expertise. Finally, ecosystem
services are valued semi-quantitatively by means of scoring, using ecopoints (step 5).
29 Sweco, 2012.

A review (step 6) shows that the results of Riksbyggen’s tools are used primarily
in relation to incorporate strategic objectives. A major advantage of the tool is its
empowerment of management to lead, guide, and follow up on efforts to achieve
more sustainable living environments. Another perceived advantage is improved
dialogue among different levels, such as among strategists, municipalities, custom-
ers, other interested parties, and administrators.

NCC – an analysis of ecosystem services
at the company’s headquarters
This example is about work with ecosystem services by NCC, the construction
and real estate development company. NCC worked with White Architects to
develop a method for analysing important ecosystem services in the early stages
of the construction process and applied it to its new headquarters in Stockholm’s
Järva Krog district.30 NCC’s overall objective is to base the design of the buildings
on existing ecosystem services. Consequently, it is important to determine how
the existing ecosystem services can best be utilised. More precisely, the valuation
involves geographic mapping of existing ecosystem services in an area.
By means of a subjective inventory – with ecological, sensory, and social assess-
ment, such as movement patterns and use, and through interviews with people on
site – the ecosystem services around NCC’s headquarters in Järva Krog were iden-
tified based on the categories in The Economics of Ecosystems and Biodiversity
FOTO: NCC/ © LANTMÄTERIET DNR 2158_140002

A. Korta naturvandringen
Gravfält från yngre järnåldern (500 –1100 e. Kr.)
Här finns drygt 120 synliga gravar.
Vildbin trivs i den sandiga miljön på åsen.
Kvarnkullen är kulturpåverkad natur av en typ som
inte finns någon annanstans i Stockholmsområdet.
Backsippor blommar på kullen på våren.
B. Kulturpromenaden
Milstenen invid gamla Uppsalavägen är från 1777.
Inskriptionen är grunt inhuggen.
Bro med växtlighet. Bron kantas av växtlighet
som gör den mer tilltalande även för insekter och
vilda djur.
Överjärva mjölkhandel hade omfattande mjölk-
produktion och bedrev jordbruk och trädgårds-
odling. Idag huserar Solna naturskola på gården.
Här finns djur, evenemang, gårdsbutiker, Statar-
museet samt gårdscafé (endast öppet fredag –
söndag under sommaren).
C. Långa naturvandringen
Hålväg är en fåra i marken som bildats av slitage
från hovar, klövar och fötter samt regnvattens-
erosion.
Bokskog har genom åren planterats kring slottet.
Naturreservatet har omfattande barrblandskog,
men intill Villa Beylon finns ett stort bokskogsparti.
Smedjan flyttades till sin nuvarande plats omkring
1860. (Troligen från ovanför Ulriksdals slottskapell).
Tre generationer smeder med namn Bjurberg har
arbetat i smedjan.
Damm där grodor och paddor leker och lägger
rom om vårarna.
Confidencen är Sveriges äldsta teater. Rokokoteatern
inreddes 1753 av arkitekt Carl Fredrik Adlercrantz.
D. Slottspromenaden
Milstenen invid gamla Uppsalavägen är från 1777.
Inskriptionen är grunt inhuggen.
Igelbäcken ger husrum åt bland annat två ovanliga
fiskarter. Nissöga som har gett namn åt en av
NCC:s bostadsrättsföreningar som ligger i Ursvik.
Den lilla bandliknande bottenfisken lever ofta
nedgrävd dagtid och är därför svår att upptäcka.
Grönlingen är bäckens andra sällsynta fiskart. Den
trivs i små bäckar med stenig botten.
Vildsvinen är skulpturer av Carl Milles. De gjordes
1929 för Lord Melchett i England och föreställer två
sittande vildsvin i brons.
Orangeriet byggdes första gången 1662–1664
efter Jean de la Vallées ritningar. Då odlade man
bland annat pomeranser, citroner och apelsiner i
växthuset.
Fisktrappan invigdes i april 2014. Den är en
faunapassage, en fisktrappa som gör det möjligt
för främst fiskar att fritt passera upp och ner förbi
dämmet. Naturgrus och sten i passagen underlättar
för grönlingen att leva här. NCC
© Lantmäteriet Dnr 2158_140002
Nature walks are one of the results of NCC’s mapping of ecosystem services at its head-
quarters in Stockholm and an essential part of making natural values and ecosystem services
visible in the local environment for employees.
30 White and NCC, 2013

(TEEB).31 In addition, joint field trips and discussions with municipal ecologists in
the City of Solna and the Royal Djurgården Administration took place.
The investigation notes that the area contains attractive green environments,
which are rather inaccessible today but could potentially add value for NCC’s
employees, customers, and neighbours.
“A leafy green walk to and from work lowers stress levels and increases the
sense of well-being. A walk at lunch promotes good health. Looking at nature
and greenery from the office window also has a positive effect on us as human
beings. A small cultivated area on the roof or next to the building can contrib-
ute both to job satisfaction and solidarity.” (White and NCC, 2013, p. 9)
Mapping was done by the actors in society who create and use the ecosystem ser-
vices. Among other things, this shows that the City of Solna and Stockholm Public
Transport (SL) are defined as the sole creators of ecosystem services, while those
in the vicinity are essentially only users of ecosystem services. Moreover, there are
a number of actors referred to as both creators and users of ecosystem services,
s
ter
tic
te
ois n
ity
ma
d n tio
wa
he
on
d a ity
on
on
e
ers
an ollu
est
an quil
ati
ati
Ecosystem service
cli
ati
ce
div
cre
llin
cro
rfa
uc
p
Bio
Tra
Air
Re
Ed
Su
Mi
Po
Project
Verdant outdoor
environments
Walking/jogging tracks
Information signs
Benches and lighting
Swimming area
Surface water management
(ponds, rain gardens, etc.)
Planted roof and walls
Over-decking
Green tramway
Urban farming
Links to green areas
Promote flora fauna
Figure 7. Projects and ecosystem services. SOURCE: WHITE AND NCC, 2013
31 TEEB, 2010.

such as NCC, property owners and their office guests, developers, and the Royal
Djurgården Administration.
A limitation of the scope of the analysis is that it relates to urban ecosystem
services.Another limitation is that the ecosystem services that are deemed to be
relevant are primarily cultural and regulatory services. Several supporting ecosys-
tem services are included in the analysis but no provisioning service. Important
ecosystem services described are; protection against air pollution and noise,
recreation, tranquillity and aesthetics, education, surface water, microclimate, and
pollination. Biodiversity and habitats are regarded as an underlying prerequisite
for the flow of ecosystem services. The identified ecosystem services are affected
in different ways depending on various possible projects in the area. For example,
Figure 7 shows that verdant outdoor environments lead to a strengthening of all
ecosystem services (besides recreation), while walking and jogging trails strength-
en recreational possibilities in the area, and so on.
Easy to implement
Prioritising
of projects
Low value for NCC High value for NCC
Difficult to implement
Figure 8. Prioritising of projects. SOURCE: WHITE AND NCC, 2013

Finally, ecosystem services are valued semi-quantitatively by assessing the degree
of importance of various ecosystem services by means of a scale (see Figure 8).
It describes how NCC can set priorities among different projects by assessing how
easy or difficult it is to implement the project and how high or low the value of
the project is for the company.
DISCUSSION
Valuation of ecosystem services is used in connection with the company’s sus-
tainability efforts (step 1). The starting point is the identification of a selection
of urban ecosystem services and a relatively detailed mapping of the actors in the
community that create and use the ecosystem services. The clear link made to the
various social actors provides a concrete social perspective and paves the way for
implementation of a socio-economic impact analysis (step 2).
Based on the factors listed in step 3 of the valuation guide, limiting the scope of
the analysis takes place with the selection of ecosystem services by type of ecosys-
tem service (especially cultural and regulatory) and with respect to local priorities
(existing ecosystem services in Järva Krog). One of the conclusions to
be drawn from NCC’s work with ecosystem services is that you must dare
to make subjective judgements. The work was carried out as a preliminary
investigation before the local development plan and design of the buildings was
determined. More detailed investigations and actions came at a later stage.
A starting point for the valuation (step 4) is that a change (caused by some
project) involves a change in the supply of ecosystem services and this in turn
contributes to high or low values for NCC. The semi-quantitative valuation of
ecosystem services (step 5) is done using a scale (see figure 10) and provides NCC
with a direct basis for decisions. What determines whether a project is easy or
difficult to implement and what constitutes a high or low value for NCC is not
however presented in any detail. The valuation in this case is largely viewed from
the company’s strategic perspective, even though benefits to society at large are
simultaneously created in the bargain. The result of NCC’s valuation of ecosystem
services is probably principally for the company itself – that is, it is intended to
be used in connection with economic business objectives. However, the valuation
can also contribute to overall policy objectives because one purpose of NCC’s
work with ecosystem services is the desire to help increase knowledge of people’s
dependence on them (step 6).

Sveaskog – markets for ecosystem services
PHOTO: HANS WINSA/SVEASKOG

Through various management measures, such as increasing the number of stems being
regenerated, the landowner has increased forest growth. Increased growth produces greater
carbon dioxide sequestration, which can then be used as carbon offsets and bought or sold
as carbon credits.
This example is about markets for ecosystem services. Sveaskog, the forestry com-
pany owned by the Swedish government, regards attention to ecosystem services
as an integral part of sustainable forestry. The company allocates 20 percent of its
productive forest land for nature conservation purposes, and the general consider-
ations afforded logging aim to counteract the negative impact on many ecosystem
services associated with forestry.32
On a general level – not associated with any particular forest – the following
are some of the most important ecosystem services that the forest provides;
production of wood products, regulation of climate through carbon sequestration,
supply of fresh water, flood and erosion control, as well as food, and recreational
opportunities. The biological diversity to which forests contribute is also empha-
sized as a foundation for all ecosystem services. One example is the carbon diox-
ide absorption of the forest and the substitution effect of raw materials from the
forest. A cubic metre of Swedish forest sequesters an average of slightly more than
one ton of carbon dioxide per year. For each cubic metre of harvested forest, an
average of 470 kg of fossil carbon dioxide emissions are avoided. If growth in the
32 Sveaskog, 2011.

forest were to increase by 50 per cent by 2035, which is feasible with intensified
forest management, the total impact on the climate would double.
In various ways, Sveaskog is participating in the emergence of markets for
ecosystem services. Some activities having a negative impact on nature areas today
that are significant for biodiversity encounter legal requirements to provide com-
pensation for the values destroyed, which is known as ecological compensation.
This creates new business opportunities for landowners who can restore valuable
habitats, protect the area for the long term and sell compensation opportunities
to companies that need to compensate for their negative impact. In this context
Sveaskog sees an opportunity to offer such a service.
Another example of Sveaskog’s work with ecosystem services is participation
in the carbon offset project. Through various types of management measures,
landowners have increased forest growth in an experimental area of 40,000
hectares in Övertorneå municipality in Norrbotten County. The increased growth
produces greater carbon dioxide sequestration, which can then be used as carbon
offsets and bought or sold as carbon credits. Sveaskog is currently working with
Övertorneå municipality, the SveMin industry association, and others to verify
these carbon credits according to a climate standard, which would promote estab-
lishment of a market for carbon credits in Sweden.
DISCUSSION
Motivating factors for Sveaskog’s work with ecosystem services are their sustaina-
bility efforts, political objectives, and international agreements (step 1). The iden-
tification of ecosystem services (step 2) is general in nature and provides a basis
for further work towards valuation. Future studies could further analyse how
various ecosystem services in the forest create social benefits and which groups in
society receive these benefits.
Based on the factors listed in step 3 of the valuation guide, limiting the scope
of the analysis is based on the type of ecosystem service. A qualitative line of rea-
soning is pursued regarding forest ecosystem functions. In future studies this could
be further developed to assess the degree of “importance” of various ecosystem
services in greater depth.
Sveaskog believes that making ecosystem services visible creates new business
opportunities, which are made concrete by participating in the development of
markets for ecosystem services. In this way, ecosystem services enter the deci-
sion-making process in business contexts for Sveaskog, which chooses to allocate
a significant portion of its productive forest for conservation measures. The price
that Sveaskog can charge for these measures, as well as for carbon credits, can in
time possibly be construed as a monetary measure of the value of the ecosystem
services generated (step 5). Finally, it can be said that in this case it appears that
ecosystem services are considered both from a corporate strategic perspective and
to create benefits for society (step 6).

Good marine environment – the importance of
ecosystem services for tourism and recreation
This example is about a project aimed at valuing the socio-economic consequences
of achieving good environmental status (HVMFS 2012:18, section 4) in the North
Sea and Baltic Sea administrative districts according to the environmental quality
standards in the Swedish regulations to implement the EU Marine Framework
Directive (HVMFS 2012:18, section 6).33 The valuation is limited to commercial
fishing activities as well as marine tourism and recreation. The following describes
the project involving marine tourism and recreation. The scope is limited to
describing the semi-quantitative valuations that were made. In addition to this, the
original report includes;
• An inventory of the links between developments in various industry sectors

that burden the marine environment, and the indicators and descriptors that
form the basis for the measurement of environmental status.
• A description of the scenarios on which the analysis is based. The analysis is
based on valuing the impact on ecosystem services since the environmental
state evolves from a reference scenario (“business as usual”) to the achieve-
ment of good environmental status.
• Monetary estimates of the benefits arising from commercial fishing and
marine tourism as a result of achieving good environmental status.
The basis for the analysis is thus a point valuation of developments in ecosystem
services as a result of improved environmental conditions and a limit in the scope
of the analysis to the ecosystem services that contribute most to recreational
opportunities. The analysis is based on a system of matrices linked to the chain of
events:
Developments in activities affecting the environment

→
Developments in burdens from these activities

→
Impact on indicators that describe environmental status

→
Impact on ecosystem services that contribute to recreational values

→
Impact on conditions for recreational activities
33 Swedish Agency for Marine and Water Management, 2015b.

The following activities describe marine recreation;
• Swimming
• Diving
• Windsurfing and waterskiing
• Boating
• Angling
• Stays at the beach or coastline for walking, picnicking, sunbathing, visiting
tourist destinations, cultural heritage, and so on.
• Water-based transports
The activities are based on a sliding scale of direct contact with water and can
thereby also be regarded as dependent on environmental status on a sliding scale.
The value of swimming, for example, is highly influenced by water turbidity,
cyanobacterial blooms, environmental toxins, and so on, while water-based
transports can be less dependent on these things. Furthermore, different activities
depend on different components of the status of the environment. Therefore, to
draw conclusions about how activities are affected by changes in the various com-
ponents of the marine environment, it is relevant to treat these activities separately
in an ecosystem service analysis.
The first step was identifying dependencies among activities and various indirect
ecosystem services. The analyses were carried out from an ecosystem service
perspective based on the Millennium Ecosystem Assessment34 and Garpe35 specif-
ically. Table 5 shows these dependencies. Throughout the assessment, a scale of
(−1) – (+ 2) is used where (−1) means that the activity is not dependent on eco-
system services and (+ 2) means that the activity is dependent on ecosystem servic-
es in a large and direct way. For example, whether the ecosystem service supplies
fish (food) or not is not important for windsurfing, while the same ecosystem
service has a crucial bearing on angling. Table 5 uses a colour scale to indicate the
degrees of dependence.
The status of the marine environment is measured by means of 11 descriptors,
each of which is made up of more precise indicators. For example, the descriptor
for the environmental status of biodiversity (descriptor 1) contains a number
of measurable indicators (1.1, 1.2, etc.) exemplifying the biomass of different
species. See the main report for details about this. A link is made in the study
between descriptors and ecosystem services, again on a scale from (−1) – (+ 2),
with (−1) meaning that the ecosystem service is not dependent on the descriptor
and (+ 2) indicating a large and direct dependence. In a case involving large and
direct dependence, one can therefore assume that the positive development in
34 MEA, 2005.
35 Garpe, 2008.

Table 5. The dependency relationship among recreational activities and various indirect
ecosystem services.
Ecosystem services Swim- Diving Windsurfing Boating Angling Stays at the Water-based
(Garpe, 2008) ming and water- beach transports
skiing
Foods
Raw materials
Genetic resources
Chemicals
Embellishments
Energy
Space and waterways
Control of pollution
Reduced
eutrophication
Biogeochemical
cycles
Sediment retention
Climate regulation
Habitat
Biodiversity
Resilience
Biological control
Food web dynamics
Primary production
Natural heritage
Aesthetic values
Inspiration
Cultural heritage
Recreation
Science and
education
SOURCE: SWEDISH AGENCY FOR MARINE AND WATER MANAGEMENT, 2015b
Low or no dependence (−1) Moderate or indirect dependence (0)
Large or direct dependence (1) Large and direct dependence (2)

Table 6. Dependency relationship among ecosystem services, indicators, and descriptors. The table indicates how
changes in indicators within each descriptor affect marine ecosystem services. Note that the effect on recreation
itself is assumed to be a consequence of the impact on indirect ecosystem services, which is why this line is blank
in the table, and the effect is assessed in a later step considering the various indirect ecosystem services affected.
Ecosystem services
including underwater noise

3. Commercially exploited
quantities of marine litter

9. Hazardous substances
(Garpe, 2008)
hydrographic conditions
7. Enduring changes of
hazardous substances
11. Supply of energy,

4. Marine food webs
8. Concentrations of
in fish and shellfish

6. Seabed integrity
10. Properties and

5. Eutrophication
fish and shellfish
2. Alien species
1. Biodiversity
Functional indicators of 1.3A X 3.1A 4.1A 5.1A 6.2A X 8.1A 9.1A X X

environmental status 1.3B 3.1D 5.1B 6.2B 8.1B
1.3C 3.2A 5.2A 8.1C
1.5A 5.2B 8.2D
1.6B 5.2C
1.6C 5.2D
5.3A
5.3C
5.3E
5.3F
Foods
Raw materials
Genetic resources
Chemicals
Embellishments
Energy
Space and waterways
Control of pollution
Reduced eutrophication
Biogeochemical cycles
Sediment retention
Climate regulation
Habitat
Biodiversity
Resilience
Biological control
Food web dynamics
Primary production
Natural heritage
Aesthetic values
Inspiration
Cultural heritage
Recreation
Science and education
SOURCE: SWEDISH AGENCY FOR MARINE AND WATER MANAGEMENT, 2015b
Low or no dependence (−1) Moderate or indirect dependence (0)
Large or direct dependence (1) Large and direct dependence (2)

the descriptor affects ecosystem services to a large extent. Table 6 shows these
dependencies. For example, based on the table, the food ecosystem service has
been affected in a large and direct way by development in most of the descriptors,
while the provision of energy is less sensitive to developments in the descriptors.
The report shows the expected development of indicators for each descriptor,
given an improvement in environmental status from a reference scenario to the
achievement of good environmental status (the standard scenario). Table 7 shows
a selection of indicators under descriptor 1, Biodiversity. In column 2 of the table,
0 means that environmental improvement does not affect the indicator (it already
has good status in the reference scenario), while 1 indicates that the status of the
indicator is enhanced. A score is then entered in column 3, which represents the
average improvement of the indicators under the descriptor.
Finally, everything is linked together by means of a matrix calculation;
• The indirect ecosystem services that were assessed as affected by the

development of the indicators (with a score >1) are listed in column 4.
• The indicator’s effect on each ecosystem service is listed in column 5
(according to table 5).
• A score is given for how the indicator’s development results in effects on the
respective ecosystem service in column 6.
• The effect of the ecosystem service on recreational activities is listed in
columns 7–12 (according to table 4).
• Column 6 is multiplied by each of columns 7–12, resulting in columns
13–18.
• Columns 13–18 are added up, and a total score is generated for each activity.
Consequently, this constitutes an assessment of the expected improvement
in the prerequisite conditions for each activity as a result of descriptor 1:
biodiversity, achieving good status.
The same thing was then done for all the descriptors, and the final scores for the
various activities were obtained (see table 8). The results showed that swimming,
diving, and angling are the recreational activities that can be expected to be the
most positively affected if the Baltic Sea and North Sea achieve good status. Final-
ly, the various industry sectors were linked. It could be observed that the rental of
various types of lodging, as well as industries associated with one-day visits, are
expected to be affected to a relatively large extent, while the effect of environmen-
tal improvements on activities such as shipping and boat rentals is not expected to
be as great in relative terms.

71
GUIDE TO VALUING ECOSYSTEM SERVICES
SOURCE: SWEDISH AGENCY FOR MARINE AND WATER MANAGEMENT, 2015b.
Indicator Ecosystem service
Development in indicator
given standard scenario?
Importance of indicators
indicators in descriptor
Average development
indicators on ES
Partial effect of
for each ES
Swimming
Swimming
Transports
Transports
Boating
Boating
Angling
Angling
Diving
Beach
Diving
Beach
(0/1)
1.3A 0 0.6 Foods 2 1.2 0 0 0 2 0 0 0 0 0 2.4 0 0

1.3B 1
Control of pollution 2 1.2 2 2 0 2 0 0 2.4 2.4 0 2.4 0 0
1.3C 1
1.6C 1 Reduced eutrophication 2 1.2 2 2 1 1 1 0 2.4 2.4 1.2 1.2 1.2 0
Table 7. Analysis linked to indicators in descriptor 1.
1.6D 0 Climate regulation 2 1.2 1 0 1 0 0 0 1.2 0 1.2 0 0 0

Habitat 2 1.2 1 1 0 1 0 0 1.2 1.2 0 1.2 0 0
Biodiversity 2 1.2 0 1 0 2 0 0 0 1.2 0 2.4 0 0
Resilience 2 1.2 1 1 0 1 0 0 1.2 1.2 0 1.2 0 0
Biological control 2 1.2 2 1 0 1 0 0 2.4 1.2 0 1.2 0 0
Food web dynamics 2 1.2 0 0 0 1 0 0 0 0 0 1.2 0 0
Aesthetic values 2 1.2 2 2 2 1 2 1 2.4 2.4 2.4 1.2 2.4 1.2
Cultural heritage 2 1.2 0 1 0 0 0 0 0 1.2 0 0 0 0
The results, improvement in activities given improvements in descriptor 1 13.2 13.2 4.8 14.4 3.6 1.2
Explanation This ...is multiplied by... ...this ...which ...which is multiplied by this matrix, i.e. eco- ...resulting in this result matrix, which describes
esti- vector... results
system service’s importance for the recreational the degree of impact on each activity based on
mate... in this
vector… activity... the impact on each ecosystem service.
Table 8. Total score for improvements in the various activities, provided that good environme-
ntal status is achieved.
Indicator
Water-based
Stays at the
Swimming
transports
Boating
Angling
Diving
beach
1.3A
1.3B
1.3C
1.6C
1.6D 13 13 5 14 4 1
4.1A 0 0 0 0 0 0
5.1A
5.1B
5.2A
5.2B
5.2C
5.3A
5.3C 11 11 4 12 3 1
8.1A
8.1B
8.1C
8.2D 7 7 1 10 1 0
10.1A 7 7 1 10 1 0
Total
score 39 38 11 46 8 2
SOURCE: SWEDISH AGENCY FOR MARINE AND WATER MANAGEMENT, 2015b.
DISCUSSION
The example shows a formalised variation of ecosystem service analysis. The
conclusions are, to a certain extent, just what you may expect – the condition of
the environment affects activities based on water contact to a greater extent, and
activities such as water-borne transport to a lesser extent. This has implications
for how industries related to them can be expected to develop.
Therefore, it is possible to discuss what this relatively technical type of analysis
adds in relation to a much simpler form of “opinion”. One advantage is that the
analysis is transparent. Furthermore, this type of analysis can be a way to simul-
taneously keep track of very complex interelationships. For example, the method
facilitates interpretation of a change in the burdens on individual ecosystem

services, which makes it possible to better value socio-economic implications of
new or changed control measures directed towards burdens on the marine envi-
ronment.
The purpose of this part of the analysis is to assess the consequences of
improvement in the marine environment on recreation (step 1), which had conse-
quences for how the valuation was carried out. The analysis was thereby limited
in scope (step 3) at the outset. However, a relatively comprehensive identification
was done of ecosystem services connected with recreation (step 2). Regarding the
relationships between various ecosystem services and their contributions to recrea-
tion, the analysis is thorough. A semi-quantitative method is used (steps 4 and 5).
Exactly what the score for each activity means is difficult to say, but based on the
score assessments, it is possible to make some comparisons.
This type of analysis must be based on a large number of standard assumptions
and also on many limitations in the scope of the analysis. In practice, it is difficult
to do a sensitivity analysis that covers everything. Therefore, an analysis of this
kind is supplemented by a line of reasoning. What do the results mean, and what
may have been missed (step 6)? In the original report this is developed in more
detail. Finally, it should be noted that this analysis was the first of its kind, which
means that the method will need to be assessed and further developed.

After-treatment of contaminated land
– the impact on ecosystem services
This example is about the research project known as Balance 4P (people, planet,
profit, process).36An analysis of ecosystem services was carried out for the planned
Fixfabriken (the Fix textile factory) urban development project in Gothenburg.
The aim of the analysis was to test a method for assessing the sustainability of
different alternatives for the after-treatment of contaminated land. The identifica-
tion stage focused on two types of ecosystem services: urban ecosystem services
and ecosystem services in soil. The urban ecosystem services are; regulation of air
quality, local climate control, noise reduction, aesthetic values, cultural heritage,
and recreation and ecotourism.
The current land use in the area involves large areas of paved surfaces and
factory buildings. The surrounding area just south of, but within the area planned
for after-treatment, provides several ecosystem services. In the surrounding area
there is vegetation that produces positive effects, such as the regulation of air
quality, but also the geological conditions suitable for the infiltration of ground
water, water purification, and so on. In addition, there are values in this area
associated with cultural heritage.
The analysis was done as follows:
• Identification of ecosystem services given current land use.

• Quantification of changes regarding quality and quantity of ecosystem servic-
es as a result of various after-treatment alternatives.
• Semi-quantitative comparison of a reference scenario (“business as usual”)
with the changes in the provision of ecosystem services that different
after-treatment alternatives or future land use lead to.
Description of the reference scenario was done by means of information on

relevant ecosystem services in the area and qualitative assessments of what they
provide today. Based on several different sources of information (such as aerial
photographs, information on future land use, geological and archaeological inves-
tigations on the site, and information on planned after-treatment alternatives),
an assessment was made of the current provision of ecosystem services and the
expected changes due to after-treatment and future use of the land. When the
ecosystem services had been identified, their status was described in the scenario
by means of scoring (tables 9 and 10).
36 Deltares, 2014.

Table 9. Scoring for describing the status of ecosystem services in the reference scenario.
Score Explanation
-1 Current land use not only inhibits the provision of ecosystem services, but also has a
negative impact on the premises
0 Current land use inhibits the provision of ecosystem services
1 Current land use has a very negative impact on the provision of ecosystem services
but still allows some provision of ecosystem services
2 Current land use has some negative impact on the provision of ecosystem services
3 Current land use has no negative impact on the provision of ecosystem services
SOURCE: DELTARES, 2014.
Table 10. Status of relevant urban ecosystem services at Fixfabriken.
Ecosystem service Parts of the Fixfabriken area
Fixfabriken Bus garage Tram Karl Johans- Surrounding

building gatan areas
Regulation 1 0 0 1 2
of air quality
Local climate 1 0 0 1 2
regulation
Noise reduction 1 0 0 1 2
Aesthetic values 0 0 0 1 2
Cultural heritage 2 0 0 0 3
Recreation and 0 0 0 0 2
ecotourism
The change in the provision of ecosystem services resulting from various

after-treatment alternatives/land use alternatives were assessed both qualitatively
and quantitatively. Table 11 summarises the impacts on ecosystem services in
Fixfabriken resulting from five different alternatives for after-treatment (read more
about this in the main report). The table shows that the after-treatment alternative
that seems to be best from an ecosystem services perspective is A2. This alterna-
tive is an example of after-treatment using so-called soft techniques, which means
that no excavation takes place if areas found during the investigation are not very
heavily contaminated. The method means less disturbance of underlying soil lay-
ers, which in turn means a lower probability of impact on archaeological remains.

Table 11. Summary of effects on urban ecosystem services and ecosystem services in soil of different after-
treatment alternatives for Fixfabriken.
Ecosystem Effects within and outside the Fixfabriken case study area (AOS)* Summary
service
Fixfabriken AOS Bus AOS Tram AOS Karl AOS Sur-
Negative effect
Positive effect
factory area garage building Johans- rounding
Total score
gatan area**
Ranking
Alternative 1 (A1)
Urban ES -1 -1 +3 -1 +1 -1 -1
Soil ES +2 -2 +2 -2 +2 -2 -4
Summary +1 -3 +5 -3 +3 -3 -5 +9 -14 -5 4
Alternative 2 (A2)
Urban ES +5 -1 +3 -1 +1 -1
Soil ES +6 -2 +2 -2 -2
Summary +11 -3 +5 -3 +1 -3 +17 -9 +8 1
Alternative 3 (A3)
Urban ES +3 +1 -1
Soil ES +2 +2 -2
Summary +5 +2 +1 -3 +8 -3 +5 2
Alternative 4 (B)
Urban ES +1 -1 -1 +1 -1 -1 -1
Soil ES +2 -2 +2 -2 -2 -2 -4
Summary +3 -3 +2 -3 +1 -3 -3 -5 +6 -17 -11 5
Alternative 5 (C)
Urban ES +3 -1 +1 -1
Soil ES +2 -2 -2
Summary +5 -3 +1 -3 +6 -6 0 3
* Areas outside the case study area, AOS (“areas off-site”).

** Surrounding area – within the development area but separate from the buildings that are actually affected by after-treatment measures.

DISCUSSION
The starting point for the ecosystem service analysis in this example is the need to
assess the sustainability of different after-treatment alternatives (step 1). A selec-
tion of urban ecosystems and ecosystem services in soil is identified (step 2). Based
on the factors listed in step 3 of the valuation guide, limits in the scope of the
analysis regarding the selection of ecosystem services was made by type of ecosys-
tem service and local priorities (existing ecosystem services in the Fixfabriken area
and its surroundings).
The starting point for the valuation (step 4) is an analysis of a change in the
supply of ecosystem services, which in this case means that the situation in a
reference scenario is compared with various types of after-treatment alternatives.
Finally, a semi-quantitative valuation of ecosystem services (step 5) is made by
means of a point scale. Integrating the importance of ecosystem services produces
a concrete basis for choosing sustainable after-treatment alternatives (step 6).
As an additional step, indicators could be used to quantify the effects on
ecosystem services and to value them monetarily, by using standard monetary
calculation values. The Swedish Transport Administration’s calculation values37
can be used for this, or you can use valuation factors developed by Ecovalue38 to
facilitate monetary valuation of various types of environmental changes.
37 Swedish Transport Administration, 2015.

38 Ecovalue, 2014.

– the value of ecosystem services in monetary terms
This example presents four studies that valued ecosystem services using different
types of environmental valuation methods. The literature regarding economic
environmental valuation methods is comprehensive.39,40 Established methods for
monetary valuation can be divided into two main groups: 1) scenario methods
(“stated preferences”) and 2) market data methods (“revealed preferences”) (see
the guide’s step 5). The studies presented in the following example have used
methods from both groups.
Valuing ecosystem services for fish in shallow seabeds

The study “Valuing ecosystem services for fish in shallow seabeds”41 shows how
enhanced fish recruitment of plaice resulting from decreased eutrophication of
the North Sea can be valued in economic terms. This case study summarises the
results from several previous research findings, for which references are presented
in more detail in the guide from the Swedish Environmental Protection Agency.
The environmental valuation method applied is the production function meth-
od, which is part of the market data methods group. In short, the production
function method holds that ecosystem services can be considered as a factor in
the production of a market commodity. For example, production in agriculture
and forestry depends on soil fertility and the fishing industry depends on water
quality and marine habitats. Catches are possible in commercial fishing thanks to
different types of inputs, such as labour, fishing gear, and boats, but also marine
ecosystem services. The basic idea behind the method is that if you can show how
the demand and supply of fish are affected by a change in the supply of ecosystem
services, it is also possible to make an economic valuation of this change.
The case study discusses how eutrophication of the sea increases the presence
of filamentous algae and during the summer causes mats to form, impairing
recruitment opportunities for plaice along Sweden’s West Coast. This entails both
impaired fishing and a negative impact on the well-being of people. The ecosystem
service valued in the example is the marine ecosystem’s provision of recruitment
areas for plaice, which means benefits for commercial fishing, but also for angling,
and positive effects for other fish species, improved swimming, aesthetic values,
and existence values.
For Danish commercial fishing in particular, plaice is a very important species.
There is a direct correlation between the amount of algae in a coastal area and the
39 Söderqvist et al., 2004.

40 Brännlund & Kriström, 2012.

area’s capacity to produce new fish, which are then recruited to the population of
plaice, which in turn determines opportunities for catches in the fishery.
A monetary valuation of the various scenarios for the degree of algal coverage
along the West Coast has been carried out by studying the effects on profits in the
Danish commercial fishing industry – that is, the less algae, the higher the profits
for the fishery. The analysis showed that if the number of plaice increases by one
million, this yields an increase in profits totalling DKK 456 million over 55 years.
In a scenario in which the degree of algal coverage is 30 per cent, the estimated
value of reducing algal coverage in recruitment areas by 1 km2 is an aggregate
total of DKK 257 million over 55 years.
DISCUSSION
The starting point for valuation in this example is that there is a need for
increased knowledge regarding the monetary size of the social benefit resulting
from reduced algal coverage of shallow bottoms on the West Coast (step 1). The
identification of ecosystem services (step 2) is based on the results of an ecological
model. The limit in the scope of the analysis is that it concerns marine ecosystem
services (step 3). The starting point for the valuation (step 4) is an analysis of a
change in the supply of ecosystem services, which in this case means that different
scenarios affect the degree of algal coverage. Finally, a monetary valuation of
ecosystem services (step 5) is made through an analysis of profits in commercial
fishing.
The example illustrates how an ecological-economic model can provide
estimates of the benefits of reduced algal coverage of shallow bottoms that can
then be compared with the costs of reducing algal coverage. For a more detailed
presentation of the case study, including a discussion of uncertainties and simplifi-
cations, see the Swedish Environmental Protection Agency’s report (step 6).42
Socio-economic analysis of costs arising from the mosquito problem

The study titled “Samhällsekonomisk analys av myggproblemets kostnader”43
[Socio-economic analysis of the mosquito problem’s costs] analyses socio-eco-
nomic costs due to the abundant presence of mosquitoes on the flood plain of the
Nedre Dalälven River. This is done through an analysis of how willing people are
to pay for a significant reduction in the occurrence of mosquitoes. From an eco-
system service perspective, the valuation focuses on providing recreational oppor-
tunities and maintaining the health and existence values in the area in question.
The environmental valuation method used is the scenario method of valuation.

43 Soutukorva et al., 2013.

In short, the scenario valuation method uses interviews or questionnaires
describing the change in the provision of ecosystem services for a usually random
selection of people. Questions are usually posed about the people’s willingness
to pay for bringing about the change or the hypothetical scenario. The method,
which has both supporters and critics, is the most widely used valuation method
internationally. An important advantage of this method is that it has the potential
to capture non-user’s assessments of the value of ecosystem services. It may well
be that people value the very existence of a good supply of ecosystem services,
what is known as existence values. Such values are not covered through the
application of market data methods, but instead by methods such as scenario
valuation.
A scenario valuation study was conducted to find out how willing people
are to pay for a package of measures that significantly reduces the occurrence
of flood-plain mosquitoes. To see how different groups in society (at different
distances from the problem) value such a package of measures, the study included
1) the public in the four affected counties (Dalarna, Gävleborg, Västmanland, and
Uppsala); 2) the public in the Nedre Dalälven area; and 3) owners of weekend
homes in the Nedre Dalälven area.
The result of the study shows that the economic value of significantly reduced
occurrence of floodplain mosquitoes in Nedre Dalälven is very large. The total
willingness to pay for the valuation scenario – that is, a reduced proportion of
flood-plain mosquitoes (from 90 to 20 percent of the present mosquito popula-
tion) and a reduction in the total number of mosquitoes to a tenth of what would
have been the case without the package of measures – is estimated at SEK 252 mil-
lion to 481 million annually. The result was interpreted in the study to mean that
the current cost to society of mosquito infestation is higher than acceptable and
largely consists of existence values that have not materialised. People living by the
Nedre Dalälven River and in the adjacent counties, as well as owners of weekend
homes, put a very high economic value on a sharp reduction in the occurrence of
flood-plain mosquitoes. One of the main reasons for this is that future generations
will be able to enjoy the results.
DISCUSSION
The starting point for valuation in this example is the need for monetary estimates
of costs to society of the abundant presence of flood-plain mosquitoes in the
Nedre Dalälven area (step 1). The ecosystem services affected are recreational
opportunities, health, and existence values (step 2). The limit in the scope of the
analysis is that it concerns ecosystem services that may be linked to a reduced
occurrence of mosquitoes (step 3). The starting point for the valuation (step 4) is
an analysis of a change in the supply of ecosystem services, which is illustrated by
a scenario for a significantly reduced occurrence of flood-plain mosquitoes. Final-
ly, a monetary valuation of ecosystem services (step 5) is made through an analysis

of the willingness of different social groups to pay for the scenario to materialise.
The results can be compared with the costs of measures that can bring about the
improvements. Finally, political decisions are necessary for the measures to actual-
ly be implemented. However, it is not a foregone conclusion that, in practice, the
funding method described in the scenario will eventually be chosen (step 6).
Economic valuation of the Eurasian jay’s seed dispersal service

In the study “Economic valuation of the Eurasian jay’s seed dispersal service”44,
45
an analysis is made of the cost for society to replace an ecosystem service –
the jay’s seed dispersal service. The environmental valuation method used is
the replacement cost method. It is not included in the scenario or market data
methods and is not based on individuals’ preferences for ecosystem services. Con-
sequently, the results from these types of studies can be difficult to interpret from
an economic perspective unless a number of prerequisites are met (see below).
The Geological Survey of Sweden (SGU)46 discusses the difficulties in interpreting
results from the replacement cost method and other cost-based methods as bene-
fits.
In brief, the replacement cost method involves calculating the costs for society
if an ecosystem service must be replaced with a technical solution of some kind.
This cost can be interpreted as the economic value of the ecosystem service, given
certain prerequisites;
• The system created by humans offers functions equivalent to the ecosystem

service, both in terms of quality and scope.
• The system created by humans is the most cost-effective way to replace the
ecosystem service.
• People are actually willing to pay these costs if the ecosystem service is no
longer available.
The main purpose of this study is to estimate the number of oak trees in the Royal
National City Park, Norra Djurgården in Stockholm, which are the result of the
jay’s natural seed dispersal, and to calculate the cost to society of replacing this
service.
Ecological studies indicate that the scarcely 100 jays found in National City
Park hide about half a million acorns per year as food supplies, of which about
30 percentgerminate. are not used but instead germinate. It is estimated that 85
percent of the oak trees in the park are the result of this natural seed dispersal.
The oak is a characteristic species in the National City Park, and people probably
44 Hougner et al., 2006.

45 Söderqvist, 2005. 39 SGU, 2014.
46 SGU, 2014.

think it is important that it remain in the future as well, but the jay is threatened
by a reduction in natural land.
A monetary valuation of the jay’s seed dispersal service was estimated on
average average to be about SEK 50,000 per jay [about 5000 €], which is about
what it would cost society to replace the jay’s work, depending on the planting
technique chosen.
DISCUSSION
The starting point for valuation in this example is to put into concrete form the
relationship between the number of oak trees and the jay’s natural seed dispersal
service by means of an eye-opening monetisation (step 1). The ecosystem service
identified is natural seed dispersal, which also represents the limitation in the
scope of the analysis (step 2 and step 3). Another starting point for the valuation
(step 4) is that the valuation is done per jay. Finally, a monetary valuation is made
(step 5) by means of analysing the cost of replacing the jay’s work, which varies
depending on planting technique. By serving as an eye-opener, the valuation can
be used to motivate investments in management of the park, which in the long-
term safeguards important areas for the jay’s survival (step 6).
The value of water quality improvements in Sweden

– a study based on value transfer
In a study titled ”Värdet av vattenkvalitetsförbättringar i Sverige – en studie base-
rad på värdeöverföring”47 [The Value of Water Quality Improvements in Sweden
– a Study Based on Value Transfer], an economic valuation is made of achieving
good ecological status in Swedish bodies of water. The environmental valuation
method used is “value transfer”, sometimes called” benefit transfer”. In a value
transfer, results from a previous study (primary study or study area) are general-
ised to apply to a new context (policy area). Carrying out new valuation studies
can be resource-intensive, making a well-considered value transfer a good alterna-
tive for monetary valuation of ecosystem services in some cases.
An analyst who wants to evaluate improvements in the ecological status in
waters such as the Umeälven River may not have enough time and money for the
collection of new data. In this case, a value transfer could mean that the analyst
draws on a previous valuation study of improved ecological status in a similar
body of water, using the results from this previous study to evaluate the improved
ecological status of the Umeälven River – that is, the analyst makes a value trans-
fer.
The purpose of this study is to use value transfer, coupled with the environmen-
tal problem of eutrophication, to value a change that entails achieving good, and
47 Enveco, 2014.

to the greatest extent possible high, ecological status for as many Swedish bodies
of water as possible. The result will then be used by water regulatory authorities
to map and analyse action plans, such as a basis for assessing the beneficial aspects
of a cost-benefit analysis. Primary studies on which the value the transfer is based
have been carried out by means of scenario methods (see above) for case study
areas in Norway and Denmark (within the AquaMoney project, 2006–2009). The
policy area is bodies of water in Sweden, divided into action areas – that is, the
values from the Norwegian and Danish case studies will be transferred into these
areas. Examples of factors that may have significance for the valuation are geo-
graphical and environmental differences between water bodies, but also the fact
that different bodies of water are used in varying degrees and in different ways.
Although adjustments for differences can be made, there will always be uncertain-
ties inherent in the method, which in some cases may be significant.
One result of the study is that the aggregate willingness to pay to achieve good
ecological status varies from about SEK 1,500 per year in the action areas of
Norra Hälsingland’s waters to about SEK 112 million per year in southwestern
Skåne’s action area. This extreme variation is due mostly to the number of house-
holds in the different action areas; three in Norra Hälsingland’s coastal and deep-
sea action area and about 195,000 in southwestern Skåne’s action area.
DISCUSSION
The starting point for the valuation in this example is the need for a socio-eco-
nomic basis for the work of the water regulatory authorities with mapping and
analysis of action plans, such as assessing the beneficial aspects of a socio-econom-
ic cost-benefit analysis, which is required in water management (step 1). The envi-
ronmental aspect being measured is the eutrophication of inland waters, which
also represents the limitation in the scope of the analysis (step 2 and step 3). The
starting point is to estimate the value of achieving good, and to the greatest extent
possible, high ecological status for as many Swedish bodies of water as possible
(step 4). Finally, a monetary valuation is made using the value transfer from a
Danish and a Norwegian case study (step 5). In a review, it is acknowledged that
the value transfer that was made cannot be used directly for policy decisions, but
that estimates can be used to point out areas needing additional analyses. For
methodological reasons, it is not recommended that estimates of willingness to
pay for different action areas be aggregated into a total calculation for Sweden as
a whole (step 6).

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Guide to valuing REPORT 6854
NATURVÅRDSVERKET
ecosystem services ISBN 978-91-620-6854-7

ISSN 0282-7298
Ecosystem services are essential to our well-being.

Yet we often take them for granted. By perceiving and
valuing ecosystem services, we can affect our future
well-being and quality of life. Politicians, public aut-
horities, municipalities, businesses, organisations, and
individuals can thereby make more conscious and wise
decisions. For example, the value of ecosystem services
should be included in planning and decisions about land
and water use.
This guide does not provide answers to all questions
on valuation of ecosystem services, but it will guide
you in finding the answers in your work. The content
has a practical orientation, with step-by-step instruc-
tions and examples. It is intended for people who work
in municipalities, business, public authorities, county
administrative boards, or interest groups. The Swedish
Environmental Protection Agency hopes that this guide
will facilitate and inspire more people to begin valuing
ecosystem services.
Naturvårdsverket 106 48 Stockholm. Besöksadress: Stockholm - Valhallavägen 195, Östersund - Forskarens väg 5 hus Ub. Tel: +46 10-698 10 00,
fax: +46 10-698 10 99, e-post: [email protected] Internet: naturvardsverket.se Beställningar Ordertel: +46 8-505 933 40,
orderfax: +46 8-505 933 99, e-post: [email protected] Postadress: Arkitektkopia AB, Box 110 93, 161 11 Bromma. Internet: naturvardsverket.se/publikationer

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Guide to valuing

REPORT 6854 • NOVEMBER 2018

Swedish Environmental Protection Agency

Printer: Arkitektkopia AB, Bromma November 2018

The Swedish Environmental Protection Agency in November 2018

VALUATION OF ECOSYSTEM SERVICES IN SIX STEPS 10

About the guide

1 Daily, G., (ed), 1997.

GUIDE TO VALUING ECOSYSTEM SERVICES 5

What is economic valuation?

Values can be expressed in different ways

• Qualitative valuation: Values expressed in words.

6 GUIDE TO VALUING ECOSYSTEM SERVICES

Valuation is based on a chain of events

GUIDE TO VALUING ECOSYSTEM SERVICES 7

• To determine if a project, a plan or a policy leads to socio-economic profita-

Reading and working with the guide

8 GUIDE TO VALUING ECOSYSTEM SERVICES

SOU 2013:68 concerning ecosystem services provides many thorough lines of

5 See the next section ”Valuation of ecosystem services in six steps”.

GUIDE TO VALUING ECOSYSTEM SERVICES 9

• A valuation of ecosystem services should be broad in terms of ecosystem

10 GUIDE TO VALUING ECOSYSTEM SERVICES

1 What are you going to use the valuation for?

2 Identify ecosystem services

3 Defining the analysis

4 Determine starting points for the valuation

5 Apply valuation method(s)

GUIDE TO VALUING ECOSYSTEM SERVICES 11

2 Identify ecosystem services goal of the activity.

4 Determine starting points for the valuation

5 Apply valuation method(s)

12 GUIDE TO VALUING ECOSYSTEM SERVICES

• Supporting data for a socio-economic impact assessment. The socio-economic

GUIDE TO VALUING ECOSYSTEM SERVICES 13

Table 1. Different types of valuation studies entail different approaches.

A basis for a socio- Yes Preferably not • Define environmental • Words

An analysis of the con- Maybe Yes Make a link between • Words

An “eye opener” No Yes • What is at risk of being lost? • Monetary units

A business-management Yes Preferably not • How does a change in • Monetary units

14 GUIDE TO VALUING ECOSYSTEM SERVICES

Valuation for physical planning/land use: The United Nations Environment

GUIDE TO VALUING ECOSYSTEM SERVICES 15

4 Determine starting points for the valuation system services; there

5 Apply valuation method(s) • Describe the way the

PROVISIONING REGULATING CULTURAL

Ecosystem services are usually categorised as provisioning, regulating, cultural, and

16 GUIDE TO VALUING ECOSYSTEM SERVICES

Pollination Wood and bioenergy

Swedish Environmental Protection Agency has developed a classification scheme

GUIDE TO VALUING ECOSYSTEM SERVICES 17

1. Does the ecosystem service exist in the area?

2. What areas are especially important for the ecosystem service?

3. In what way does the ecosystem service create benefits?

18 GUIDE TO VALUING ECOSYSTEM SERVICES

6. What other ecosystem services does it depend on or affect?

If your valuation study involves assessing the consequences of a particular project,

7. Is the ecosystem service affected by the project?

8. In what way is it affected?