This paper aims to help demystify PES for non-economists, starting with a simple and coherent definition of the term. It then provides practical ‘how-to’ hints for PES design. It considers the likely niche for PES in the portfolio of conservation approaches. This assessment is based on a literature review, combined with field observations from research in Latin America and Asia. It concludes that service users will continue to drive PES, but their willingness to pay will only rise if schemes can demonstrate clear additionality vis-a_-vis carefully established baselines, if trust- building processes with service providers are sustained, and PES recipients’ livelihood dynamics is better understood. PES best suits intermediate and/or projected threat scenarios, often in marginal lands with moderate conservation opportunity costs.
Center for International Forestry Research