Defenders' Experts
Bundling and Stacking Ecosystem Service Credits
Restoration and conservation projects often produce ecosystem services that are not recognized or valued in current natural resource frameworks. Landowners should be able to capitalize on multiple values, rather than be forced to focus on a single attribute. Failing to recognize the interconnectedness of ecosystem services can lead to the degradation of one service in order to improve another. Stacking and bundling services can improve the integration of ecological values, providing a more holistic view of natural systems and allowing landowners to tap multiple sources of revenue.
Stacking
Stacking allows landowners to sell different types of credits from a single location or receive multiple revenue streams from the same action. For example, if a landowner restores an acre of riparian forest, it could produce water quality credits, carbon credits, riparian habitat credits, and conservation banking credits, all of which the landowner could sell into the respective markets.
Bundling
Bundling allows a landowner to combine multiple values from a piece of property under a single credit type. For example, restoring an acre of riparian forest results in improvements to more than one ecosystem service, but they will be defined as a single type-riparian habitat credits-that could be sold on a voluntary or regulatory market. Market rules will ultimately determine how bundling and stacking are handled.
How are bundling and stacking handled now?
When buyers purchase credits from a wetland bank, they purchase the bundle of values that the wetland provides. The banker is generally not allowed to sell other ecosystem service credits (like endangered species credits) from the same site. This policy satisfies people concerned with “double dipping,” but it does not necessarily lead to an economically viable operation for the landowner. Different agencies handle stacking and bundling differently. Agriculture agencies tend to allow landowners to sell ecosystem services created with public investments on private lands, while wildlife agencies often do not.For now, the Marketplace for Nature will likely follow the rules emerging from the Counting on the Environment project managed by the Willamette Partnership. These rules specify that a given parcel of land must be designated for the sale of only one kind of service. In the long run, it will be necessary to develop more consistent and sophisticated tools and policies concerning bundling and stacking credits in ecosystem service markets.
Return to previous pages:
The Marketplace for Nature, initiated by Defenders of Wildlife and managed by a consortium of public and private organizations to demonstrate how a voluntary multi-credit ecosystem marketplace will work.
Marketplace for Nature goals include ecological effectiveness, addressing multiple values, rewards for strategic investment and others.
Developing a standard approach to measuring habitat quantity and quality within ecosystem service markets that can be accepted and applied across the U.S. Read more.
How does the Marketplace for Nature select a project site?
Partners working together to develop rigorous standards for the Marketplace for Nature. See who's involved.
