Natural Asset Management: Valuing, Maintaining & Replacing Natural Assets

How much is a frog worth? The little Northern Red-Legged frog that plopped into the water as we approached Hart Creek for our weekly water sampling was certainly a valuable addition to our morning. Growing up on the edges of suburbia my days were often spent catching frogs and snakes and interesting bugs. But now I rarely see a frog. This day was richer for having seen our amphibious friend, but I could never attach a dollar amount to that brief encounter.

We all believe that nature has value. But we’re referring to a philosophical value, not the kind of value that an accountant can enter into a spreadsheet. But there is a growing movement among urban planners and city managers to do just that: to put a dollar value on certain aspects of nature and then enter that value into a spreadsheet. This approach, referred to as Natural Asset Management, was pioneered by the Town of Gibsons on B.C.’s Sunshine Coast and treats certain aspects of the natural world as capital assets. According to the Gibsons website their municipal asset management policy:

“Explicitly defines and recognizes natural assets as an asset class” but more importantly “Creates specific obligations to operate, maintain and replace natural assets alongside traditional capital assets. These obligations include having well-defined natural asset management strategies in place, as well as the financial resources to maintain them.”

There is a good, local example of these ideas just a few kilometres to the south of us. In 2017, the City of Nanaimo, together with the Municipal Natural Assets Initiative (MNAI), began a study of the Buttertubs Marsh Conservation Area, an area of reclaimed wetland. The wetland had been restored to provide the public with recreational and educational opportunities, but as a side benefit the marsh also provided the Millstone River with flood protection, giving excess water somewhere to go other than the streets of Nanaimo. They estimated the costs of replacing that flood protection with engineered stormwater management ponds. What they found was that it would cost almost $5 million dollars to build equivalent protection to what the wetland was now providing, including the cost of purchasing land on which to build the ponds. If the effects of climate change were considered, the cost jumped as high as $8 million dollars.

As a thought experiment we might apply these ideas to the value of our local aquifer. What if our aquifer was threatened? We might imagine each household installing cisterns for storing rainwater. If cisterns ran dry too soon, we might add in the cost of truckloads of water at different times of the year. Providing water for firefighting might involve large community storage tanks. Without doing the work of actually putting numbers to these ideas I think it’s quite clear that our aquifer is a very valuable financial asset, and certainly one worth protecting, not just for the frogs.

Links:

Gibsons’ Natural Asset Management Journey

Municipal Natural Assets Initiative: City of Nanaimo

Municipal Natural Assets Management Initiative

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