Results-Based Financing for Climate

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Slowing Deforestation in Costa Rica (Payments for Environmental Services, PES)

Created Feb 21 2017, 12:00 AM by Julian Sosa Valles
  • Deforestation & forest degradation-project examples
  • Water-project examples

Project Name:

Slowing Deforestation in Costa Rica (Payments for Environmental Services, PES)

 

Sector:

Water

 

RBF Instrument:

Incentive payment

 

Budget (USD):

$90 million

 

Project sponsors:

World Bank (GPOBA);GEF; Government of Costo Rica

 

Description:

Forests in watersheds produce higher-quality water, reducing downstream water treatment costs; The improved ecosystem generates carbon sequestration benefits. By 2006, payments were made to nearly 2,400 landowners spanning approximately 212,000 ha of privately owned forests, distributed as follows: i) protection = 200,798 ha, ii) reforestation = 7,551 ha, iii) forest management = 3,394 ha.

 

Description of the RBF Scheme:

The payments for environmental services (PES)  linked the payment to agreed behaviors that encouraged the conservation of existing forest. Land owners received the payment only if they adopted the specified practices. The monitoring was undertaken primarily by the agencies responsible for contracting with farmers. Sequent annual payments to the farmers were made after verification of compliance.

 

Publication Title:

A Guide to Results-Based Financing in Water Investments, The World Bank