Putting a 'True Price' on biodiversity

You may have heard the word ‘biodiversity’—it’s often used in the context of ‘biodiversity loss’, alongside the terms ‘habitat destruction’ and ‘climate change’. You might also know that when it comes to biodiversity, more is better...but what is biodiversity? How can it be measured? And why is getting it right so important to Acorn’s work?

Xi Zhu, one of Acorn’s remote sensing data scientists, has answers for you. Having recently published the team's research in a recent paper (here), Zhu explains how he and his team explored new ways of mapping biodiversity and how this can improve carbon programs in the future.

What do we measure?

To measure biodiversity (and whether it’s improving or declining), we need to determine which aspects of an ecosystem’s function are measurable. For our biodiversity studies, we focus on these variables:

  • Richness: How many different species are present in an environment? The more different species, the higher an environment’s richness.

  • Evenness: Evenness, on the other hand, looks at how many individuals of each species are present, and how that number compares to the number of individuals in other species.

  • Fragmentation: Then there's fragmentation. If a forest is connected, it's cohesive; if it’s separated by human infrastructure, it's fragmented. Fragmented ecosystems tend to be less healthy, robust, and resilient to change. Measuring fragmentation is an essential metric for biodiversity because fragmentation prevents organisms from being able to connect with one another as they would naturally, created isolated pockets of a formerly interconnected ecosystem.

Mapping of functional diversity at an Acorn site in Colombia using several different methods.

How do we measure biodiversity?

Excitingly, agroforestry techniques (such as those used by farmers in the Acorn program), have the potential to increase each of these biodiversity metrics listed above. For example, landscape cohesion can be improved using agroforestry techniques by turning farms into ecological corridors. Instead of an ecosystem broken apart by agricultural land, agroforestry-led farms allow the farmland to return a certain degree of connectivity to the landscape.

Using remote sensing, my colleagues and I can gather a wealth of information about the land we’re looking at with our satellites. Using the satellites’ multispectral imaging capabilities, we can measure the percentage and density of land cover, how fragmented these parcels of land are, as well as much smaller details. We can identify individual species and their function based on their nitrogen, chlorophyll, and carotenoid content, and we can even use measures of photosynthetic processes to determine how well the ecosystem is functioning. All this data allows us to assess how an ecosystem and its biodiversity are changing over time—and if agroforestry interventions are making a measurable difference.

Image: LiDAR data coverage of the Cauca Valley Montane forests, Colombia.

Measuring the 'True Price’ of Acorn programs

To explore this question, Acorn recently launched a pilot program putting this data to work: monitoring and quantifying the benefits agroforestry practices can have on biodiversity. We partnered with the Impact Institute to then determine the real-world monetary value of these biodiversity impacts. Now, putting a literal ‘price’ on biodiversity will never be an exact science, as many of the benefits of biodiversity are inherently intangible and can never truly be defined.

It may seem counterintuitive to ascribe a monetary value to something so complex and precious, but by providing data-backed insights into just how much economic benefit can be gained by preserving and restoring biodiversity, we make the first steps toward incentivizing the preservation of our world in a market dominated by economic concerns. For example, economic valuation of biodiversity can influence policy-making by demonstrating the economic importance of conservation. Policymakers are more likely to prioritize conservation initiatives when they recognize the measurable economic contributions of intact ecosystems to human well-being.

Using the True Price method

By using the data available to us through remote sensing, we’re implementing a new method to provide as accurate an estimate as possible of the economic value of biodiversity gains: the True Price method. True Price looks at ecosystem functions through the lens of the value they provide to humans. Those fall into broader categories like:

  • Provisioning services, which include food, water, and materials

  • Regulating services, such as climate, water cycle, nutrient cycle

  • Cultural services like recreation, inspiration, and spirituality

  • Habitat services, or the habitat an ecosystem provides for species.

With the Impact Institute‘s partnership, we were then able to overlay the monetary value of these services onto our biodiversity data, and the results are very promising. We’ve found that applying agroforestry practices not only increases biodiversity year by year, but also increases the economic value of that biodiversity. Looking at 1000 Acorn-partnered agroforestry plots in Colombia’s Cauca Valley (consisting mostly of coffee farms), we took one data point per plot per year for 2019-2023. From our biodiversity data taken by remote sensing, we were able to detect an increase in species richness, an increase in species evenness, and increase in landscape cohesion—all key indicators that biodiversity is on the rise.

With the input of the Impact Institute, we were able to determine that this biodiversity increase translated to a restoration of between 20 to 25 euros worth of biodiversity on most of the farms, with an average a of 17 euros restored across all farms. And that’s without considering that 80% of all Acorn’s Carbon Removal Unit (CRU) sales go back to the farmers, bringing them financial benefits and bolstering the local economy.

Cross-checking with the GBS method

True Price is a relatively new methodology to be applied in the field of biodiversity tracking. The world’s most robust and well-verified methodology for assessing changes in biodiversity is the Global Biodiversity Standard (GBS). To verify our own methods and the results from our Colombia pilot study, we also partnered with GBS. Using GBS ground truth data collected during another study run at a site in India, we were able to validate our methods and be confident that our data, and therefore the economic metrics extrapolated from that data, are accurate and reliable.

What’s next?

Our next steps are to broaden our analysis. Not only do we want to assess more plots in these areas in Colombia, but we’d also like to expand our analysis to the plots surrounding the agroforestry project areas. This, along with further GBS ground truth data on these sites and others, will help us be able to more accurately determine how much of the change in biodiversity can be ascribed to the agroforestry measures (as opposed to other potentially unrelated factors, such as existing old-growth forest presence). We’re also planning to expand our analyses to other Acorn partners across the globe, with the goal of assessing how the True Price methodology translates across different crops and different kinds of biomes.

Putting a literal price on biodiversity may seem superficial, but it is the keystone for incentivizing a dedication to programs whose mission it is to restore biodiversity for the health and wellbeing of us all. This innovative project on understanding the True Price of biodiversity will help restore habitats and improve biodiversity in targeted areas, providing tangible benefits to local livelihoods and to biodiversity globally.

About Acorn

We help support smallholder farmers in developing countries transition to agroforestry. Together with local partners, we facilitate the funding and training needed by farmers to start their agroforestry transition. Transforming the sequestered CO2 through agroforestry into Carbon Removal Units (CRUs), we offer carbon credits to responsible corporates to help them reach their climate goals. The growth of the trees is measured with satellite imagery, AI and LiDAR, and certified by ICROA-accredited Plan Vivo.

With 80% of the sales revenue going directly to the farmers, it creates an additional income stream and helps them adopt a more climate-resilient way of farming that improves food security, biodiversity, and financial independence.

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Xi ZhuRemote Sensing Data ScientistLinkedIn
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