The EU Policy Framework

1. The EU Policy Framework Policy Workshop – Designing PES Schemes and Markets for Ecosystem Services Laure Ledoux, DG Environment Brussels, 6 July 2012

2. Content • EU Policy Context • Progress in implementing the Biodiversity Strategy • Outstanding issues and next steps

3. The EU mandate (March 2010) • Adoption of a long term (2050) vision By 2050, European Union biodiversity and the ecosystem services it provides – its natural capital – are protected, valued and appropriately restoredfor biodiversity’s intrinsic value and for their essential contribution to human well-being and economic prosperity, and so that catastrophic changes caused by the loss of biodiversity are avoided • Adoption of a mid term (2020)headline target Halting the loss of biodiversity and the degradation of ecosystem services in the EU by 2020, and restoring them in so far as feasible, while stepping up the EU contribution to averting global biodiversity loss 3

4. Adoption of EU post-2010 biodiversity vision & headline target Adoption (15-26/03/10) International biodiversity policy framework Adoption of new global Strategic Plan 2011-2020 (vision, mission, 20 targets) CBD COP10 (10/2010) Development andadoption of post-2010 EU Biodiversity Strategy Adoption by Commission (05/ 2011), endorsed by Council (06/2011)

5. 2050 Vision 2020 headline target ES reflected throughout 6 targets 6 Targets: 1 Enhance implementation of nature legislation 2 Restore ecosystems est. Green Infrastructure 3 Sustainable Agriculture & Forestry 4 Achieve Maximum sustainable yield 5 Combat Invasive Alien Species 6 Contribute to averting global biodiversity loss ACTIONS

6. Target 2 in the Biodiversity Strategy Target 2: By 2020, ecosystems and their services are maintained and enhanced through the establishment of Green Infrastructure and the restoration of at least 15% of degraded ecosystems. • Action 5: Improve knowledge about ecosystems and their services in the EU • Action 6: Establish priorities for restoration and promote the use of Green Infrastructure • Action 7: Ensure no net loss of biodiversity and ecosystem services

7. Principles for EU Biodiversity financing • Biodiversity Strategy: • Diversify and scale up financing sources (public and private) • Role of innovative financing instruments, including market-based instruments, e.g. PES, PPP for green infrastructure, biodiversity offsets (no net loss initiative) • June 2011 MFF communication: • Mainstream biodiversity throughout the EU budget, including main financing instruments • Efficiency: maximising co-benefits of various funding sources (climate change) • Implemention: benchmarks, monitoring and reporting rules and tracking procedure

8. 2020 roadmap to a resource efficient Europe • Promote the use of innovative financial and market-based instruments and explore their wider potential […] • Put forward proposals to foster investments in natural capital, to seize the full growth and innovation potential of GI and the ‘restoration economy’ through a Communication on GI (2012) and a ‘No net loss’ initiative (2015)

9. EC study - IFM to enhance biodiversity private sector finance • Study objectives: • Analyse conditions, opportunities and limitations for private sector biodiversity finance • Provide advice on future policy options - EU and international if possible • Investment Options analysed: • Pro-biodiversity businesses • Supporting carbon storage actions • MBI: Biodiversity Offsets, Payments for Ecosystem Services (PES) • Green infrastructure projects • Cross-cutting issues: Risk, and Information • Challenges: • Need for strong policy signals/regulatory framework in order to scale up to full potential • Need for pilot/demonstration projects

10. Council Conclusions 21 June 2011 10 WELCOMES the focus of the Strategy on biodiversity as a whole and ecosystems services - within but also beyond protected areas – in recognition of the essential services they provide as well as their intrinsic and economic value; WELCOMES the emphasis on maintenance, including management, and cost-effective restoration of ecosystems to ensure the continued provision of ecosystem services, in particular given the climate change mitigation and adaptation benefits of many ecosystems and the relevance for human well-being; UNDERSCORES the importance of green infrastructure also as a contribution to further integrating biodiversity considerations into other EU policies; and WELCOMES the Commission’s commitment to develop a Green Infrastructure Strategy by 2012; ‘STRESSES the importance of further work to operationalise the 'no net loss' objective of the Strategy for areas and species not covered by existing EU nature legislation and of ensuring no further loss or degradation of ecosystems and their services’

11. Council Conclusions 19 December 2011 (1) 11 STRESSES the need of maintaining, restoring as far as feasible and enhancing ecosystems and their services; REITERATES that properly valuing biodiversity and ecosystem services can contribute to their conservation and sustainable use; RECOGNISES the importance of promoting the integration of these values into decision making processes and accounting and reporting systems at EU and national level by 2020; and ACKNOWLEDGES that this work should be supported by the results of ecosystem mapping and assessment of the state of ecosystems and their services. In view of the short timeframe for initiating this work, URGES the Commission and Member States to determine the modalities for and scope of these tasks building upon the work carried out by the Member States; 'agrees that a common approach is needed for the implementation in the EU of the NNL principle and invited the Commission to address this as part of the preparation of its planned initiative on NNL by 2015, taking into account existing experience as well as the specificities of each Member State, on the basis of in-depth discussions with Member States and stakeholders regarding the clear definition, scope, operating principles and management and support instruments in the context of the common implementation framework of the Strategy'.

12. Council Conclusions 19 December 2011 (2) CALLS UPON the Commission to consider, within the scope of the Green Infrastructure (GI) Strategy under preparation, among others, the following issues: a) possible scope and key components of GI; b) possible framework for GI implementation based on existing experience, particularly in spatial planning, including coastal; c) methodological issues related to GI, including with regard to spatial connectivity between protected areas and basic requirements for the delivery of the necessary ecosystem services; d) options to integrate GI in existing policy instruments and importance of GI in terms of climate change adaptation; e) identifying opportunities for financing GI; f) communication and promotion of GI targeting different stakeholders and sectors, and in particular local authorities;

13. EP Resolution April 2012 (1) Payment for ecosystem services (PES) is a promising, innovative financial tool for biodiversity conservation; Stresses that protecting, valuing, mapping and restoring biodiversity and ecosystem services is essential in order to meet the goals of the Roadmap to a Resource-Efficient Europe, and calls on the Commission and the Member States to consider, as part of specific measures, presenting a timetable for mapping and assessing ecosystem services in the EU which will enable targeted and efficient measures to be taken to halt the degradation of biodiversity and ecosystem services; urges the Commission and the Member States, therefore, to value ecosystem services and to integrate these values into accounting systems as a basis for more sustainable policies;

14. EP Resolution April 2012 (2) Wishes the EU to set a considerably higher restoration target reflecting its own more ambitious headline target and its 2050 vision, taking into account country-specific natural conditions; urges the Commission to define clearly what is meant by ‘degraded ecosystems’ and to set a baseline against which progress can be measured; Urges the Commission to adopt a specific Green Infrastructure Strategy by 2012 at the latest, with biodiversity protection as a primary objective; underlines that this strategy should address objectives relating to urban as well as rural areas, inter alia in order better to fulfil the provisions of Article 10 of the Habitats Directive; Urges the Commission to develop an effective regulatory framework based on the ‘No Net Loss’ initiative, taking into account the past experience of the Member States while also utilising the standards applied by the Business and Biodiversity Offsets Programme; notes, in this connection, the importance of applying such an approach to all EU habitats and species not covered by EU legislation;

15. Knowledge-base • Action 5 • Mapping & assessment of ecosystems and services (by 2014) • Economic value assessment and integration into accounting and reporting systems(by 2020) Policy tools • Action 6a • Restoration prioritisation framework (by 2014) • Action 7a • Biodiversity proofing methodology (by 2014) Baseline Policy initiatives Maintenance of ecosystem services • Action 6b • Green Infrastructure Strategy (by 2012) • Action 7b • No Net Loss initiative (by 2015) Strategic approach to compensation Target 1 Nature legislation Target 2 By 2020, ecosystems and their services are maintained and enhanced by establishing green infrastructure and restoring at least 15% of degraded ecosystems Target 5 Invasive alien species Target 3 Agriculture and forests Target 4 Sustainable fisheries Other EU legislation, WFD, MSFD… 15

16. Relevant studies Biodiversity proofing Estimating Target 2 financing needs TEEB follow-up study for the EU Supply and demand of HB and design elements Mapping of ecosystems and ES Options for reaching restoration target Options for NNL initiative

18. EU Target 2 Roadmap

19. NNL: Some issues raised • Need for gap analysis • Offsets in context of mitigation hierarchy and habitat banking just one of the options • From presentation of Member State experiences and concrete case studies • Additionality • Need for metrics – measuring losses and gains • Long term management issues • Availability of land • Different approaches to 'habitat banking'

20. Outstanding issues and next steps • Knowledge base: significant differences across MS – importance of action 5 • Further development and implementation of policy initiatives • Importance of mainstreaming BES in all instruments in the next budget • Enabling conditions for private sector involvement?

21. Thank you for your attention More information EU biodiversity strategy http://ec.europa.eu/environment/nature/biodiversity/policy/index_en.htm Ecosystem Assessment homepage http://biodiversity.europa.eu/ecosystem-assessments Environment and economics webpage http://ec.europa.eu/environment/enveco/index.htm Bisehttp://biodiversity.europa.eu Contact: Laure.Ledoux@ec.europa.eu