the danube pes project - natural capital markets

The Danube PES project

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Webex meeting

Review of the project

Rayna Popova, WWF DCP

Bulgaria

Date 17 February 2014

Shorter title Secondary information can go here

XX-XX Month, Year

• Additional information can run

• Underneath if necessary

Structure of the presentation

PES Danube project – What will this project achieve?

Case study 1 – Public payments for reducing the

environmental impact of the Aquaculture sector and Fishieries

in Bulgaria

Case study 2 – “Rusenski Lom” sustainable tourism

Case study 3 – “Persina pilot” an example of market payments

in support to wetland restoration and cutting CO2 emissions

Next steps – (Swiss project?)

17 February 2014

Timeframe:

Jan 2010 – Dec 2014

Scope of the project:

Bulgaria, Romania,

Serbia and Ukraine

Overview of project

issues and progress THE DANUBE PES PROJECT

What will this project do?

To demonstrate and promote PES and other sustainable financing

schemes in the Lower Danube river basin;

Encourage related Sustainable Financing schemes (SF);

Demonstrate how national and local-level PES/SF schemes works;

Contribute to rural development and conservation in the Lower

Danube Basin in Romania and Bulgaria;

Promote the integration of PES/SF schemes in River Basin

Management Plans for the Danube, its sub-basins and other major

river basins;

To derive lessons of relevance for the Danube basin at large and for

other international watersheds;

Overview of THE DANUBE PES PROJECT

Project progress Overview of project

issues and progress THE DANUBE PES PROJECT

• 3 private PES schemes in

Romania and Bulgaria effectively

reward provision of Danube-related

ecosystem services and are

integrated into Danube River Basin

and sub-basin management plans.

• 2 public PES schemes still in

progress.

• Capacity building and training in

PES/SFs for key stakeholders in

Romania and Bulgaria.

• Private sector involvement and

support for PES schemes

demonstrated.

• Information and experience

exchange for key stakeholders in

Danube and sub river basins.

• Experience exchange with

stakeholders in selected major river

basins.

• Best practices and lessons learned

are documented, distributed and

discussed with the conservation and

international community.

Fishery and aquaculture sector in

Bulgaria – Problems and Solutions ?

Problems:

High contamination of water in fish farms because of:

1.Use of agricultural fodder and organic left-overs of plant and animal origin;

2.Use of manure of animal and non-animal origin;

3.Contamination with nitrogen, nitrates, nitrites, hydrogen sulphide and

methane;

Solutions:

1.Use of fodder with high environmental indexes – granulated and extruded;

2.Decrease water contamination of nitrogen, nitrates and nitrites with 50%;

3.Decrease water contamination of hydrogen sulfide and methane with 30%;

Sustainable

Aquaculture THE DANUBE PES PROJECT

Sustainable


Sustainable


Sustainable


The schemes

PES

FUND

State aids

Buyers of ES:

Government

Accumulation

of funds from:

National

budget

(fees, penalties

in the fishery

sector)

Providers of ES:

Fishpond

managers

Allocation of

funds to:

Registered

operators, based

on volume and

costs on fish

feed

Sustainable


Operational framework

Society Fishpond manager

Public payment

Public good – water quality

Sustainable


Sustainable


Sustainable


Sustainable


Beneficiaries / Budget / Time line

Operators in the fishery

sector:

• Individuals

• Legal entities, including sole

proprietors

• 8 million BGN

• 2013-2020

Sustainable


Sustainable aquaculture scheme

The support is provided for transition from use of

conventional to environmental fodder (extruded and

granulated)

It aims at compensating farmers for additional costs

associated with the use of environmental fodder (extruded and

granulated), in comparison to the conventional one

The support will be granted on annual basis, in return of

invoices on fodder purchased, making also check of the

species and numbers of the fish bred, according to the

farmer’s registration.

Sustainable


`

Rusenski Lom Pilot site

is:


is:

Rusenski Lom

pilot THE DANUBE PES PROJECT

Profile of the site

Conservation values

• Nature park located in Northeast

part of Bulgaria

• The canyon-like valley of 4 rivers

• One of the 11 nature parks in

Bulgaria - 3,408 ha

• Part of 2 protected areas

• Important Bird Area – 200 sp.

• A rural area of 23 settlements

• A site of culture and history

Rusenski Lom


Rusenski Lom


Rusenski Lom


Rusenski Lom


Rusenski Lom


`

Main goal: attracting funds from users of natural capital in Rusenski

Lom Nature Park, in a fund whose resources will be spent specifically for

conservation activities

Subject: visitors control and biodiversity conservation to reduce the

negative impacts of the tourism on habitats and species.

Range: Rusenski Lom Nature Park

Responsible tourism in

Rusenski Lom

` ИНИЦИАТИВА ЗА ОТГОВОРЕН ТУРИЗЪМ В РУСЕНСКИ ЛОМ Тази концепция е разработена от WWF в България по проект „Насърчаване на плащания за екосистемни услуги в басейна на река

Дунав”, финансиран от Глобалния Екологичен Фонд чрез Екологичната програма на ООН

I. ОПЕРАТИВНА РАМКА НА ИНИЦИАТИВАТА

4. Manage the

revenue 1. Transmit of

materials for sale

2. Sale materials and / or

put an eco-charge rate

3.Account the

revenue in the

bank

5. Work to preserve the

natural benefits for

tourism in Ruse Lom NGO: Friends of

Rusenski Lom

BUSINESS PARTNERS

Hotels, guest-houses etc.

Tour operators, travel companies

USERS

Tourists, visitors

Found Monitoring Committee

Every year

propose

conservation

measures that

protect the

natural benefits

for the tourism

and discuss the

budget for next

year

Local

Authorities

Rotation of the

representative

Rusenski Lom

NP

Directorate

WWF

casting vote in

the first 5 years

After the different stakeholders sign the partnership agreement

Business Rotation of the

representative

Monitoring

Committee

NGO: Club Friends

or Rusenski Lom

NP

Accept / reject

the annual work

plan and budget.

Monitor the work

of the Club

Organize independent

control and monitoring

of the initiative

NGO

Rotation of the

representative

`


is:


is:

Persina pilot site THE DANUBE PES PROJECT

Profile of the site

Conservation values

• Nature park - 21 762 ha, located in central

north of Bulgaria

• Protected area on the Danube of inland

marshes and flooded forests, including 24

islands, 3 reserves, 2 natural landmarks, 1

protected area – Kaikusha Marsh

• Natura 2000 site and IBA (Ramsar Convention)

– 170 bird sp. and 450 plant sp. 1/3 of them

directly related to water ecosystems

• Rural area including 3 municipalities within

approximately 27 000 residents

Why biomass from wetlands and

farmland residues?

• Easy to connect to other WWF programs, projects and activities in the

region; High value and available area; Climate change orientated solution,

with potential for up-scaling

• Self-sustaining economic solution for wetland management and

restoration that can also find political support

• Feasibilities studies show that in Bulgaria about 30% of straws, 65% of

cornstalks and 80% of other solid agricultural waste can be used for

energy production, an estimated 800,000 tons annually

• Approximate biomass production from existing protected wetlands in BG

(40,000 ha), respecting the biodiversity needs (cut only 20% per year) an

estimated 24,000 tons annually in production of pallets and briquettes


Benefits from the Persina scheme

Environmental Benefits

• Sustainable management and use of biomass from wetlands and

farmlands in about of 7,100 ha (incl. model area of 150 ha protected areas –

‘’Kaikusha‘’ marsh)

• Reduction of CO2 in the atmosphere associated with stubble burning and

decomposition of biomass in the fields / wetlands

• Improvement of the water regime of ‘’Kaikusha‘’ marsh and restoration of

its regulatory functions with respect to water, maintenance of fish stocks,

fixation of CO2, maintenance of the biological diversity

• Improvement of soil fertility on more than 5,000 ha of agricultural land

• Improvement of water quality on more than 2,000 ha wetlands


• Creation of business interest in the use of biomass by generating

revenue from the sale of pellets and briquettes

• Creation of economic opportunities for land users to utilize residues in

farmlands as a source of additional income, also covering the costs of

collection and transportation of residues

• Offering an alternative to the local population to shift from fossil fuels

as coal and firewood consumption to pallets and briquettes and reduce

the energy costs in the housholds by an average of 30%.


Benefits from the scheme

Economic Benefits

• Green jobs – new employment opportunities for the local population by

involving local people in the processes of extraction and processing of

biomass

• Creation of jobs indirectly as an additional source of revenue for

collection and transportation of raw materials


Benefits from the scheme

Social Benefits

The Scheme


euro

Providers of

ES:

Farmers

Buyers of

provisioning ES

(biomass):

Producers of

pellets/ briquettes

biomass

Users of regulating ES

Amount of biomass production by the most typical species (plants)

in Kaikusha marsh per m2 = (150 ha)

P g/m2/y D g/m2/y B g/m2/y Area ha Tons

Phragmites

(reed) 802 521 280 120 336

Typha (bulrush) 955 620 334 21 70

Schoenoplectus

(sedge) 890 578 311 9 28

Average grams per

m2 ~ 873 ~ 563 ~ 299

Average tons per

hectare 8,7 5,6 2,9 150 = 436 t

Production (P); Decomposition (D); Biomass accumulation (B)

Total average of 2,9 tones biomass per/ha/year = 436 tons per Kaikusha marsh

Comparative financial value of biomass yield from Kaikusha marsh

in two versions:

29 May 2012 - 23 Presentation to the Third PSC

option 1 Processing of 1 ton of

biomass in the village

Lesidren (150 km)

option 2 Processing of 1 ton

of biomass in

Belene town (20 km)

Leva per ton Leva per ton

Production of biomass 40,00 lv. 40,00 lv.

Primary processing (baling) and transport 120,00 lv. 30 lv.

Processing of biomass supply and delivery 200,00 lv. 200,00 lv.

Labor 100,00 lv. 100,00 lv.

Value of the pallets 460,00 lv. 370,00 lv.

Market value of conventional pellets 400,00 lv. 400,00 lv.

Reserve / Balance + 40,00 lv. - 30,00 lv.

Cut only 20% of Kaikusha marsh

biomass per year = 88 t

40,480 lv.

~ 20 000 EURO

32,560 lv.

~ 16 000 EURO

Amount of sequestered carbon by the most typical

species (plants) in Kaikusha marsh per m2 = (150 ha)


P gC/m2/y D gC/m2/y RgC/m2/y Area ha

Carbon

“R” per

ton per

species

Phragmites

(reed) 105 68 37 120 204

Typha (bulrush) 201 131 70 21 15

Schoenoplectus

(sedge) 161 105 56 9 6

Total C 467 304 163 150 240

Production (P); Decomposition (D); Refractory carbon accumulation (R)

Total average of 1,6 tones /ha/year = 240 tons Carbon sequestration in Kaikusha marsh - 25 E per ton is additional 6000 Euro per ETS schemes per year

Volumes of biomass derived from different farm

lands in the pilot site area, incl. wetlands


•Type of culture Sown

area

ha

Average

yield per

ha - ton

Overall biomass

production -

tons

Biomass average

yield in sustainable

nature way (by 30%,

65%, 80%, 20%)

Wheat and barley 1400 4 5600 1867 t

Corn 2650 7 18550 12057 t

Sunflower 1027 2,5 2567 2053 t

Reed 2000 2,9 5800 1160 t

Total of area and

productions

7077 32 517 17137 t

Total market price

of pallets 370 lv.

per ton, per year

6 340 690 lv.

~ 3 120 000 Euro

Comparison table of prices of heat from different fuel

types allows automation of the heating process



No Type of the fuel Calorific value Efficiency

Price of the fuel

(by 2010)

Price per

1 KW

1 Diesel 11,67 KW/liter 88% 2.07 lv/liter 0.204

2 Electricity 1 KW 100% 0.173lv/kw 0.173

3 Nature gas 9,89 KW/m3 90% 0.9349lv/m3 0.105

4 Wooden chips 4.9/KW/kg 90% 0.36lv/kg 0.081

5

Pallets from

wetlands and

agriculture

waste 5.16/KW/kg 90% 0.28lv/kg 0.063

Test results of the Reed energy value -

Independent laboratory analysis – Sofia



No Name of indicators Unit of

quantity

Standardized

methods,

validated

internally lab

Results form

tasting

Norm

DIN 51731

1. Moisture % DIN 51718 5,1

±0,2

12 max

2. Specific heating value kcal/kg DIN 51900 - -

2.1 Working fuel kcal/kg DIN 51900 4346

±25

4181- 4657

2.2 Working fuel KJ/kg DIN 51900 18196

±90

17500- 19500

3. Sulfur content of dry

mass

% DIN 51724 0,056

±0,003

0,08 max

4. Balance after

incineration / ash / dry

weight of

% DIN 51719 5,5

±0,1

1,5 max

5. Extraction of volatile

substances on dry

weight

% DIN 59700 78,2

±0,2

-

Cost and benefit analysis and financial indicators show that the

investment is effective and the idea could be realized in a big scale



• Net Present Value > 0

• Internal Rate of Return ~ 68%

• Profitability Index 6,3%

• Payback period – 2 years

Presentation to the Third PSC

Conclusion for wetlands

• The highest - productivity ecosystems

• Opportunities for additional income for local people

• Diverse benefits, including all

• Local energy source

• Decision to costly problems such as floods and construction of

treatment plants for domestic wastewater in in small settlements

• Highest absorbability of C02


Conclusion for wetlands

29 May 2012 - 29

Shorter title Secondary information can go

here

XX-XX Month, Year • Additional information can run

• Underneath if neccessary

Lessons learnt

Development of the scheme in a big scale requires double

efforts because of the unknown and no popular topic

Political goals and plans in Bulgaria do not focus on wetland

restoration through well developed political and economic

framework

It is necessary to ensure multiple sources of income

Carbon financing from the ETS could be additional profit but is

not implemented for the moment in a small scale

Support by national and local institutions is highly necessary!

Thank you

[email protected]

www.panda.org

mailto:[email protected]

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