Economic valuation of ecosystem services in Balatin River Sub-Watershed, Southern Philippines

Abstract

Purpose. The study aimed to estimate the economic value of the ecosystem services provided by the Balatin River Sub-Watershed (BRSW) as a basis for policy recommendations focused on its conservation. Methodology / approach. The economic values were estimated through the Total Economic Value approach. To estimate the use values of the provision of water supply for households and irrigation use, the market price method and productivity method were used, respectively. Meta-analysis benefit transfer was used to estimate the non-use values. Results. An estimated 1,327,560 m3 of water is supplied to households every year with total revenue of PHP 20,626,441.20 per year. PHP 4,026,773.80 is generated annually to provide irrigation water. In addition, regulating services of the BRSW generate an amount of PHP 12,191,487.85 in 2021 price levels as a benefit for the residents. This generates an estimated total economic value of PHP 36,844,702.85 with benefits spread across the users in the community. The water for drinking benefits accrue to the residents whose water is supplied by the BRSW through the Wao Water District, the benefits of irrigation water are mostly received by farmers, and the benefits of regulating services accrue entirely to the residents within the BRSW and the surrounding communities. Originality / scientific novelty. This study was able to obtain a relatively higher estimated value by using multiple valuation methods in contrast to the conventional method of using a single approach. Additionally, the study contributes to addressing the limitation in existing literature particularly in the BRSW and the remaining sub-watersheds of Lanao del Sur which also suffer from degradation. Practical value / implications. The results of this study show that the BRSW is currently an indispensable resource for the municipality. The study is a first in the municipality and can therefore be used as an input in the appraisal of the watershed’s economic value. The estimated economic value generated by the watershed illustrates a portion of what has been neglected over the past decades as the deterioration of BRSW continues.