Helen Allison Frank Murray Richard Hobbs

1. A policy analysis of market-based mechanisms to effect natural resource management in the SW region of WA A case study of emissions trading of carbon offsets Helen Allison Frank Murray Richard Hobbs School of Environmental Science

2. Outline • The problem • Research question • Hypotheses • Synergy & solutions • Integrating resilience theory & the adaptive cycle & SD • Modeling methods • Model boundary chart • Reference modes • Causal loop diagrams • How do I….?

3. The crux of the problem • “Be careful with practices like mitigation and carbon markets, which are equilibrium solutions (in a non-equilibrium world) and which usually rebound to the detriment of the natural environment. • A major challenge is to protect and conserve the natural environment in spite of the political/ economic power status quo, not to implement policies within the framework of, and reconfirming, that status quo.” • Pers. Comm. Kenyon De Green 2001

4. Extent of land clearing in the south west region of Western Australia

5. The problem • Past policies have caused present resource degradation • Complex interactions are acknowledged between physical, biological, economic and social processes • However, proposed policies are based on resource accounting, benefit-cost analysis & market-based mechanisms

6. Salinity development - the future Risk for shallow groundwater for SW region in 2030 Perth RISK High Medium Low risk

7. Carbon sink Carbon credit H2O Synergy Natural resource restoration & climate change CHO

8. Potential carbon sink activities:Tradeoff between high water use,yield, and carbon • Prevention of further clearing • Perennial plant species e.g. Lucerne • Farm forestry • Commercial plantation • Conservation planting • Soil carbon

9. Research question • How can industry’s need to offset carbon dioxide emissions be linked to agriculture’s need to address the multiple objectives of economic viability and natural resource management? • Example objectives • Mitigating salinity • Improving water quality • Maintaining biodiversity

10. Hypotheses • Natural resource degradation in the south west region of Western Australia has been caused by policy resistance • Policy resistance in natural resource management is the result of systemic causes including Government policy intervention, economic growth as the primary objective and differences in fast and slow moving variables • There is a lack of understanding of the feedback loops between the social, ecological and economic systems • Market-based mechanisms are economic equilibrium solutions that will produce unintended effects in a non-equilibrium system • The management of long term natural resource problems requires overarching value laden policy goals

11. Integrating system approaches • System dynamics • Complex adaptive system theories • Resilience ideology & theory • Understanding the characteristics of the interactions between human and natural systems

12. Model boundary chart

13. Reference modes ofagriculture in WA1889-2002 • Land use change • Land clearing and forestry establishment • Structure and social change • Farmer median age and farmer numbers • Economic • Terms of trade • Natural resource condition • Area affected by salinity

14. Time horizons of area cleared and forestry in the WA Plantations Australia policy objective Year

15. Time horizons of median age and numbers of farmers in Australia

16. Farmer terms of trade and natural resources Farmer terms of trade: The ratio of the index of prices received by farmers to the index of prices paid by farmers. Reference year 1997/1998 = 100

17. Internal oscillation with information delay

18. 100 60 1960 1980 2000 2020 2040 Year Exponential decay of natural resources 100 60

19. Salinity and revegetation causal loop diagram Negative loop showing the goal and delays 

20. Causal loop diagram  

21. How do I…? • The rule of hand - which are the driving variables? • Scale - How to deal with hierarchies? • Qualitative values - how to deal with values and attitudes? • when there are 2 or more qualitative values • 0.5 x 0.5 = 0.25 • Aggregation - data rich/data poor

22. Concluding remarks Climate change and natural resource degradation are serious problems for Western Australia Revegetation programs could in theory absorb carbon dioxide and improve groundwater use and reduce the rate of salinity increase Rate of revegetation is dependant on social, environmental and economic variables

23. Contact details Helen Allison Environmental Science Murdoch University PERTH, Western Australia 6009 Australia Email:hallison@central.murdoch.edu.au Tel: (0)8 9360 6389

25. Stocks

26. Decision framework Structural adjustment - bigger farm Management change - best management practice Diversification - commodity range Commodity change -price chasing Land use change

27. Eight stages of decision making • Anticipation of degradation • Seeing degradation • Seeking information • Weighing the alternatives and risks • Making a decision • Undertaking a trial • Making a change • Reaffirming the decision

28. The adaptive cycle Source: C.S. Holling (1993)

29. Adaptive cycle 3 dimensions Source: Gunderson & Holling 2002

30. Panarchy Source: Gunderson & Holling 2002

31. Panarchy in a catchment Showing how different sub-catchments can be in different phases of the adaptive cycle

32. Interpretation of the adaptive cycle