Archives for posts with tag: ecosystem services

5 lessons from the mitigation banking conference

May 21, 12 //
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Slightly over a week removed from the Mitigation Banking Conference, I’ve finally found time to reflect on the lessons I learned at this event. The top 5, in no particular order, are as follows:

1. Highly fragmented and localized markets. Wetland mitigation banking success in Florida doesn’t lead to mitigation banking success in California. Similar to the water market, ecosystem service markets vary from basin to basin, state to state, and regulatory office to regulatory office.

2. Face time matters. I sponsored last year’s event and strategically followed up with likely clients. An email and phone call will never replace interpersonal communication–at least for me.

3. Regulations drive mitigation markets.  It became obvious the majority of buyers for wetlands, streambank, and species credits, don’t do it because they like the product ( think iPhone or Car). They buy them because they have to. Similarly, simple supply and demand will eventually determine water allocations–and already does in certain markets– but regulatory closures are expediting many of the water quantity markets.

4. Regulators are also a target market. In most traditional markets, you direct your marketing efforts to the buyer. This is where mitigation markets differ. Because regulators are forcing the purchase, they play a critical role in the transaction. In some instances, they drive every deal.

5. I love water. I really enjoyed the conference and have tremendous respect for these markets and their players. I also greatly appreciate my  water work within these mitigation markets. Although, time and time again, I was thankful for working in water markets. As cumbersome and inefficient as they be, water rights are assets that have survived the test of time.

Communicating Ecosystem Services

March 16, 12 //
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As you may or may not have noticed, I’m on a “marketing communications” kick. Continuing with this theme, I’d like to share a new thread from the Ecosytem Commons’ Soap Box: Good one! Communicating Ecosystem Services.  I posted a comment and wanted to take the time to encourage others to do so. Here were my initial thoughts:

I enjoyed the examples above.  Effectivley communicating these efforts is obviously a challenge. Not only are ecosystems complex, the means to measure and navigate regulatory frameworks further the confusion associated with these emerging markets.

Using  an example close to home, I think Big Sky Brewing Company did a good job communicating their  purchase of Water Restoration Certificates.  The complexity of this transaction is endless: water right source switching, change applications, lease agreements, credit registry, monitoring, etc. Rather than getting bogged down in the details, Big Sky Brewing told a simple story: water makes Montana… Montana and we’re putting water back where it matters most.

Thanks again for starting this discussion. I believe “marketing communications” is overlooked and vital for the success fo these markets.

12 thoughts on the ecosystem markets workshop

May 27, 11 //
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My initial intention was to express 10 lessons I learned from participation in the Center for Collaborative Conservation Ecosystem Markets Workshop. I soon realized the list below evolved into a summary of “thoughts” developed or reinforced by the conference, rather than lessons.

1. Simplify, Simplify. The meeting rooms were full of experts from respective ecosystem markets. Although each individual understood their own market, comprehending the other markets (including mine) was difficult at best. If professionals in this industry have trouble grasping these projects, how will the public fare?

2. Language is key. In continuance of #1, applying clear and consistent language is critical to the future of these markets. Buyers don’t purchase products they don’t understand.

3. Can we scale? Each of these markets are highly localized and fragmented. As a result, scalability remains a challenge. For broader success, these market solutions must become scaleable.

4. Demand drives markets. Supply and demand are critical components to market emergence. Of the two, I believe demand is the most important. If an individual or entity is willing to purchase a product, the supply will take care of itself.

5. Cash is King (and queen and prince too). In a similar vein to demand, these markets will flourish when they are profitable. Because of their social values and passionate leadership, they will most likely exist and survive without profitability, but they will flourish with it. Take for example the “internet”, once it became profitable, the creativity and growth exploded.

6. Iron fist or fluffy bunny? There were some great discussions around regulatory vs. voluntary markets. I see a combination of the two in the future ecosystem markets. For voluntary markets to survive, they need clearly defined  “products” that potential buyers can easily identify as adding real value. Otherwise, the most robust ecosystem markets will remain under regulatory caps and government funds.

7. Trust me… The Ecosystem marketplace trades “Eco assets”, and in this developing market trades are personal.  They require a good deal of trust and relationship building. Developing and respecting the trust of landowners is critical…actually, essential.

8. The Bundle. Just as diversifying a portfolio is considered a sound investment strategy, bundling ecosystem assets decreases investment risk. Furthermore, leveraging multiple private, public, and non-profit partners diversifies stakeholders and increases the likely hood of overall success.

9. It takes time. Rome wasn’t built in a day, and this wasn’t the first ecosystem markets conference (surely won’t be the last). These markets take time and are still in their infancy.

10. Start. Right now. One of my favorite quotes is: “It’s better to vigorously execute than perfectly plan.” I find this especially true in these emerging ecosystem markets. Rather than discuss the potential, execute and evaluate. Then do it again, and again, and again.

11. I like Fort Collins. I’m a big fan of college towns and Fort Collins is no exception. With the Rockies in the back yard, a vibrant downtown, and no shortage of craft breweries, what’s not to like?

12. Thank you. On a final note, I’d like to express another thanks to the Center for Collaborative Conservation and all the attendees for the opportunity to participate. It was fun, engaging, and educational. I hope to see you all soon.

 

ecosystem market initiative: beer and water

May 18, 11 //
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I’ve been invited to the Center for Collaborative Conservation as a panelist to discuss my work with Water Restoration Certificates and Big Sky Brewing Company. Beer, fly fishing, water, what’s not to like? The panel will focus on market initiatives for ecosystem service projects followed by a “World Cafe” forum discussion. To broaden this conversation, I shared my abstract below. Also, the organizers requested we pose a question to the audience, so I’m asking you:

How do you encourage businesses to engage in “voluntary” ecosystem service solutions that don’t directly decrease cost or increase profitability?


Lotic Initiative Summary

water rights and ecosystem markets

May 2, 11 //
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Water rights play a critical role in western ecosystem markets. Unique to the West, a water right must underlie all new water use for ecosystem services. This requires reallocating or acquiring the water rights necessary for your project (i.e. wetland development). Lotic has had the fortunate opportunity to work with mitigation bank developers across the West. The mission for most of these banks aligns perfectly with Lotic’s vision of turning blue into green. As a result, this is work we enjoy and actively pursue.

To show our support and eagerness to further engage in this market, Lotic sponsored the National Mitigation and Ecosystem Banking Conference. We have also developed a slidedeck (below) that highlights our services in this market.

Similarly, Lotic will be presenting at the Ecosystem Markets Conference in Madison, Wisconsin. This presentation will highlight the importance of water rights in western ecosystem markets and explore additional opportunities that exist with water markets. The abstract for this presentation is provided below. We hope to see you there.

Abstract

In the West no water right means no water. Ecosystem services are no exception when it comes to the importance of water rights. Securing water rights is a critical component of establishing mitigation banks. This session will demonstrate the importance of water rights in mitigation bank development and will help you to recognize additional market opportunities that these water rights assets provide.

Asset Management

Mitigation banks in the West require appropriate consideration of existing water rights. Researching and taking inventory of all water rights and determining how to reallocate them is critical to the overall success of mitigation bank development. Furthermore, securing valid water rights for a mitigation bank can increase its return on investment and decrease its legal risk of water rights. Having valid water rights can also lead to additional market opportunities.

Market Opportunities

Pressure to reallocate water rights from agriculture to urban and environmental use is driving water quantity markets across the West. With increasing thirst and decreasing supply, this arid region needs an efficient system to distribute water rights among competing users. The answer lies in private water quantity banking. Water banks provide private market opportunities to mitigate groundwater development. Stacking water quantity banks with other mitigation banks offers additional profits for mitigation bank development.