Well-managed watersheds provide valuable services to downstream residents, such as an adequate supply of good quality water. These services are in jeopardy if land, in upstream areas, is poorly managed. This can have serious impacts and cost for downstream water users. Until recently, society has expected farmers to protect critical watersheds without any form of compensation for the services they provide and the costs they face. Payments for watershed services are mechanisms that aim to compensate land-users and owners for the services that they can provide. New York City is assisting farmers to change their landuse. By doing so, it has avoided the cost of constructing a massive water purification plant. Implementing similar changes in developing countries is extremely challenging. ‘Shed Loads’ looks at the potential and problems for payments for watershed services in South Africa, India and Bolivia.

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Crystal Clear Solution – New York

The supply of drinking water to any major city is a huge task. How do you provide a reliable supply of water of sufficient quality and quantity to meet the needs of millions of households? New York City Department of Environmental Protection not only manages to deliver over 1.2 billion US gallons (4.5 billion litres) of water daily, but the water is of such pristine quality that it does not require filtration, saving the City and its ratepayers enormous sums of money.

Selling the Selati – South Africa

South Africa is a country richly endowed with natural resources. These natural resources are becoming pressurised through population growth, urbanisation and economic development. Increasing pressures on water resources in particular are threatening the whole ecology, and ultimately the economy, of the region. Stringent measures are being taken by the Government to preserve the quality and supply of these natural resources. One example of a watershed that represents the political, social, and ecological pressures in South Africa is the GaSelati Watershed. Here, initiatives are under way to find creative solutions to prevent further degradation of the watershed that may ultimately be used to improve other watersheds in the country.

Better Lake than Ever – India

The city of Bhopal is infamous as the site of a horrendous industrial disaster, when over 20,000 people were killed in a deadly gas leak from the Union Carbide chemical plant. However, the local authorities have strived to enhance the city’ s environment by improving an ancient man-made wetland through protecting its watershed areas. The city has focused on reducing pollutants from the urban part of the watershed, and lately has turned its attention to its surrounding rural area. Recently these wetlands gained international recognition as a conservation site because of their ecological importance.

Bees for Water – Bolivia

In the rainforests of Amboró National Park, Bolivia, water has ironically become an increasingly scarce resource. Farmers in Los Negros are losing out to farmers in Santa Rosa, who source their water upstream in the same watershed. To help resolve this conflict, the two communities have adopted an approach of community-based forest resource management. This means that farmers in downstream Los Negros compensate farmers in Santa Rosa when the upland farmers conserve forest cover, which in turn conserves water. The compensation arrives in the form of beehives, allowing Santa Rosa farmers to explore alternative livelihoods.

Markets for Watersheds

This paper provides a brief introduction watersheds and the threats they face; followed by a description of new management approaches which are based on the mechanism of watershed payments.