Assessing the value of natural capital in the Lower Fraser Valley
Posted December 2005
The term 'natural capital' refers to a region’s natural, environmental, and ecosystem resources, and land. It is capital because it contributes goods and services necessary for environmental and economic health. In addition to some of the more obvious benefits of environmental conservation such as habitat preservation, flood control, and ensuring water quality, there are significant financial benefits. Assigning a monetary value to our natural resources creates another motivation for environmental preservation and restoration.
All over the world, natural capital is being destroyed. B.C. is no exception. Many of these important assets are being lost, often permanently. Current land-use practices may, in many cases, be responsible for natural capital losses worth hundreds of millions of dollars each year. The Lower Fraser Valley is an area where this is occurring rapidly.
Threats to the valley’s natural capital
The Lower Fraser Valley is divided into two districts: the Greater Vancouver Regional District (GVRD) and the Fraser Valley Regional District (FVRD). With about 57 percent of B.C.’s population, it has been significantly impacted by urban development and industrial agriculture. Extensive destruction and degradation of wetlands, forests, riparian habitats, and other natural assets has already occurred and continues at an alarming rate. In addition to the actual losses, urban, agricultural, and industrial pollution greatly decreases the effectiveness of natural areas in contributing to the region’s economic health.
Greater Vancouver is growing more rapidly than some of the world’s megacities. By 2020, the population of the Lower Fraser Valley is projected to be more than three million. One of the biggest contributors to the loss of natural capital is the growth of low-density suburban communities containing a high percentage of single-family detached houses. In 1996, suburban neighbourhoods accounted for 72 percent of the GVRD’s population. Land-use plans utilizing a high percentage of low-density housing accelerate the rate of natural capital losses. Urbanization is expected to consume an additional 28,000 hectares of land by 2026.
Increased rates of urban and industrial pollution also put stress on natural capital. Highly contaminated urban runoff containing high concentrations of suspended solids regularly discharges into waterways. In addition, the Fraser River receives about 25 tons of organic material from sewage treatment plant discharges daily, as well as a similar amount of contaminated material from industrial pollution. This makes the Fraser River unsuitable for direct-contact recreation.
Industrialized agriculture represents a serious threat to natural assets. The amount of fertilizers and pesticides used on agricultural lands has increased significantly, leading to contamination and nutrient loading of the soil, surface water, and groundwater. The growing numbers of high-density livestock operations are producing wastes in quantities too large for the environment to safely absorb and neutralize. And, the increased numbers of greenhouses are consuming natural areas previously used by ducks, geese, and shorebirds.
What has been lost?
Flood control structures have significantly changed the valley’s hydrology. The Fraser River no longer renews its floodplains with silt and nutrients. Streams and wetlands have been separated from the river by dikes, resulting in the loss of fish and wildlife habitat. The majority of forests and wetlands in lowland areas of the valley have been lost to agricultural and urban development. This decreases natural flood-control mechanisms. Many streams have been lost, and 72 percent of those that remain are threatened or endangered. Habitat destruction, pollution, and increased human activity continue to impact the region’s wildlife, leaving many species currently at risk.
Putting a dollar value on natural capital
Wetlands are tremendously important for many reasons, including flood control, water storage and filtration, groundwater replenishment, shoreline stabilization, and sediment and nutrient retention. In addition, they provide the habitats necessary for fish and wildlife species, and represent an important storehouse of biodiversity. They also offer tourism and recreational opportunities. The value of the area’s wetlands for these and other uses may amount to hundreds of millions of dollars per year. The ecological services of just one of the region’s wetland areas, Burns Bog, have been valued at $60 million per year.
As was previously mentioned, nutrient-rich runoff from agricultural operations is greatly impacting the valley’s surface and groundwater. Wetlands can provide an effective means of removing this nutrient contamination. The ability of the valley’s wetlands to remove nitrogen and phosphorus from water has been estimated to be worth $18 to $50 million per year.
Uncut forests provide goods and services that can benefit an area’s economy. Tourism and recreational opportunities, as well as some mushroom and berry harvesting have been conservatively estimated at $824,000 per year for floodplain forests. This figure does not even include other benefits such as erosion control, water purification and storage, and carbon sequestration.
Recreational activities such as skiing, hunting, fishing, wildlife viewing, camping, water sports, and hiking in the valley’s natural areas can contribute greatly to the economy. The value of only some of these activities has been estimated at $19 million per year.
In Summary
This article has provided only a brief overview of the value of some natural capital in the Lower Fraser Valley. In reality, it is very difficult to place monetary values on natural resources and their contributed goods and services. They are, in essence, priceless. However, when land-use plans are drawn up it is good to keep in mind some of the numbers that have been generated.
Protecting the region’s natural capital may produce savings of hundreds of millions or even billions of dollars annually. But this will only occur if these valuable assets are preserved and/or restored. Some have already been permanently lost, and others can never be fully restored. Once they are gone they may be irreplaceable. Even if replacement was possible, it might be extremely costly. The best course of action is to ensure their preservation now. The economic savings to society both now and in the future makes environmental conservation and restoration fiscally responsible.
For more information download the Ducks Unlimited Canada and Nature Conservancy of Canada publication, The Value of Natural Capital in Settled Areas of Canada.