IDEAS home Printed from https://ideas.repec.org/a/eee/ecoser/v75y2025ics2212041625000750.html
   My bibliography  Save this article

Valuing and accounting for water-related ecosystem services for water pricing and management: An Australian case study

Author

Listed:
  • Chen, Yuqing
  • Wyrwoll, Paul
  • Burnett, Peter
  • Grafton, R. Quentin
  • Vardon, Michael

Abstract

By demonstrating the value of ecosystem services (ES), ecosystem accounting addresses the water crises by providing insights from both supply and demand perspectives. This requires ES valuation and an understanding of how valuation methods, accounting treatments, and water availability affect ES values. Using the System of Environmental-Economic Accounting (SEEA), we valued water-related ES using multiple methods, two accounting treatments, and produced monetary ES accounts for the Australian Capital Territory (ACT) to evaluate how accounting can support water pricing and management. We found that ES values varied significantly across valuation methods, accounting treatments, and water availability, ranging from AUD −10 to 998 million in the ACT. The huge range highlights the importance of selecting appropriate methods and accounting treatments when using the SEEA. Our approaches to ES valuation were: (1) ES value is embedded within economic transactions and ES value is a subset of these, and (2) ES value is unrecognised in economic transactions and proxy methods are used. Using the second approach, methods that use prices from similar markets and replacement cost extend the production boundary of the System of National Accounts (SNA) and provide additional information on economic value. Using ACT data, we demonstrate how ES valuation and accounting can be applied to current water pricing to better reflect ES use, water scarcity, and to spread costs overtime. Accounting for ES value may justify price increases to limit short-term demand, and fund catchment management activities (‘nature-based solutions’) as well as water supply infrastructure. Together, these tools and actions can mitigate the challenges of sustainably meeting water demands within socio-ecological constraints.

Suggested Citation

  • Chen, Yuqing & Wyrwoll, Paul & Burnett, Peter & Grafton, R. Quentin & Vardon, Michael, 2025. "Valuing and accounting for water-related ecosystem services for water pricing and management: An Australian case study," Ecosystem Services, Elsevier, vol. 75(C).
  • Handle: RePEc:eee:ecoser:v:75:y:2025:i:c:s2212041625000750
    DOI: 10.1016/j.ecoser.2025.101771
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S2212041625000750
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.ecoser.2025.101771?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecoser:v:75:y:2025:i:c:s2212041625000750. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/ecosystem-services .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.