Case Studies:
Kanla-on Spring Water Plant PES contributions The Kanla-on Spring Water Plant supports the farmers within the Mt. Kanla-on Natural Park in implementing sustainable agroforestry activities in order to protect the quality of its bottled water. Ongoing since 1997 The source of the water used by the Kanla-on Spring Water Plant (KSWP) can be traced to the innermost strict protection zone of the park. The company’s business therefore depends on the maintenance of the watershed function of the forest. The forest is continually degraded by migrants and indigenous people who are economically and culturally dependent on the forest. SupplyLandowners within the natural park, in the infiltration area of the spring/groundwater reservoir the company is exploiting. Mt Kanla-on was declared a protected area in 1997and it serves as headwater catchment for three major river systems. DemandThe Kanla-on Spring Water Plant (KSWP), owned by La Tondena Distillers Inc., is located some 8km away from the park but draws the source of the spring water it used is located within the park. IntermediaryLa Tondena Foundation carried out the project in collaboration with the Philippine Business for Social Progress (an NGO). FacilitatorMajor funds for parallel livelihood projects, park protection and conservation activities came from GEF-WB. Other bodies involved include the Department of Environment and Natural Resources (DENR) and National Integrated Protected Areas Systems (NIPAS). ServiceWater quality protection. CommodityImproved Management Practices , through sustainable agroforestry aimed at stabilization of riverbanks and soil conservation measures . Rehabilitation of existing ecosystems for protection , also through reforestation. Payment MechanismUnclear . Intermediary-managed. Funds are used alongside parallel funds from GEF-WB in the area. Terms of PaymentIn-kind payments: i)tree saplings- the buyer has also established two nurseries and 100,000 fruit trees were planted along with some forest trees. ii) Technical training: 51 local farmers receive technical assistance to adopt sustainable agroforestry practices such as SALT (multi-storey planting, rock walling and use of organic fertilizers). (Rosales and de los Angeles, 2001, cited in Arocena-Francisco, 2003) Funds InvolvedIn 1997, about twenty-eight upland farmers were involved in the process of reforestation and rehabilitation of the land, with a budget of P200, 000 (about US$ 3,700 at current rates).Analysis of costs and benefits EconomicShort-term income benefits from labour. Environmental20 hectares were reforested and 80 hectares of forestland were rehabilitated. According to the requirements of the Environmental Compliance Certificate issued by Department of Environment and Natural Resources, the Spring Water Company was also required to undertake additional environmental protection activities. ( Arocena-Francisco, H. 2003) SocialIn addition to forest rehabilitation activities the company also invests in social development projects:- provides the host community with spring boxes (ground water collection devices) benefiting 50 households - 1-2 km-access road - a 2-room school building - free medical clinics - nourishment programs - and cash donations - it has assisted the organization of the Ilijan Development Organization (IUDO)— a community group of 98 farm families contracted to do reforestation and provided with livelihood enhancement programs. (Arocena-Francisco, H. 2003) Legal basis for collection of fees for environmental services is defined in the National Integrated Protected Area System Act (NIPAS, RA 7586) which creates the Integrated Protected Area Fund (IPAF) where funds for resource protection and management can be channelled. Benefits to livelihood projects took a long time because of the long process of community preparatory work, unclear guidelines on the use of the livelihood fund, and a lengthy learning process on the approval procedures. Arocena-Francisco, H. 2003 Rina Rosales, REECS [SMTP:rina@mla.nsclub.net] Rosales and de los Angeles (2001). Estimating Watershed Protection Service Fees for Extraction of Spring Water from Mt. Kanla-on Natural Park (MKNP). Final report submitted to the NGOs for Integrated Protected Areas (NIPA). NIPA Inc/REECS Arocena-Francisco, H. 2003. Environmental Service "Payments": Experiences, Constraints and Potential in The Philippines. Bogor, Indonesia, ICRAF- World Agroforestry Centre. http://www.worldagroforestry.org/sea/networks/rupes/download/paper/Hermi_RUPES.pdf
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