Payment for Ecosystem Services 2.0: The Natural Capital Trust of Costa Rica

We designed a new national Payment for Ecosystem Services (PES) scheme for Costa Rica using a systematic approach for the creation of governance arrangements and financial mechanisms based on Elinor Ostrom’s design principles for sustainable commons management. This PES 2.0 updates significantly the almost 30-year-old current scheme by expanding the scope to all the natural capital of the country (i.e., private, public, terrestrial, coastal and marine), as well as expanding the ecosystem services that will be the focus of the different modalities of the PES. This study presents the first estimate of the annual value of Costa Rica’s total ecosystem services, amounting to $14.5 billion. Finally, to assess and enhance the efficiency of the proposed scheme, we developed a Natural Capital Priority Index (NCPI) tailored to PES schemes. The NCPI identifies areas where investments are likely to generate the highest socioeconomic and environmental returns by spatially estimating ecosystem service provision, threats to their sustainability, and zones of high conservation value. This proposal of the evolution of one of the world’s best-known PES schemes will not only help the country to achieve its nature stewardship goals, but will also increase the level of participation from a wide diverse group of actors from society creating significant new opportunities to increase their livelihoods and well-being.