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Ecological compensation

Assessing Socio-economic and Ecological impacts of Ecological Compensation

Ecological compensation is used to mitigate the impacts of development on biodiversity and ecosystem services and means that exploitation and land-use changes that cause adverse effects on biodiversity and ecosystem services are compensated by providing new values in another area.

Compensation measures usually consist of restoring or establishing, and thereafter managing natural values, such as nature reserves, wetlands or recreational areas. Ecological compensation is the last step in the so-called mitigation hierarchy, which requires that land exploiters avoid, minimize or restore biodiversity on site before considering compensation.

About the project

The overarching aim of the project is to develop a framework to illustrate the potential of ecological compensation to reach biodiversity targets, considering social and economic factors. We will do this by using a trans-disciplinary approach where science and practice exchange knowledge to explore the ecological, social and economic impacts of different institutional designs of ecological compensation.

A state-of-the-art review will be used to explore existing forms of institutional designs of ecological compensation, both in a Swedish and international perspective. A case study analysis of already implemented compensation projects will provide understanding of the ecological knowledge used, as well as institutional drivers and barriers.

Furthermore, we will do a review of estimates of recreational values and use these to extend an ecological model to enable calculations of ecological compensation for specific sites. Based on the review, we will develop an economic evaluation method to analyse the distributional and welfare impacts of ecological compensation. Thereafter, we will combine the economic and ecological model to demonstrate a method to assess the impacts of ecological compensation. Moreover, ecological compensation will be assessed in comparison to other policy instruments, such as regulations and fees.

Ecological compensation

Path in a forest. Photo.

Assessing Socio-economic and Ecological impacts of Ecological Compensation is a three-year long project that started in January 2018 and is funded by the Swedish Environmental Protection Agency (Naturvårdsverket).

Involved researchers

Ecological compensation involves researches from Centre of Environmental and Climate Science (CEC) at Lund University and AgriFood Economics Centre at the Swedish University of Agricultural Sciences and Lund University.

The project is coordinated by Jonas Nordström (AgriFood) and other involved researchers are:

  • Johanna Alkan Olsson (CEC)
  • Mark Brady (AgriFood/CEC) 
  • Yann Clough (CEC) 
  • Helena Hanson (CEC) 
  • Katarina Hedlund (CEC) 
  • Henrik Smith (CEC) 
  • Fredrik Willhelmsson (AgriFood)