Report on valuation methods

The demand for non-marketed forest ecosystem services, like for example, carbon sequestration has been increasing the last decades and this has been accompanied by attempts to establish new market for such services. This development is an opportunity for forest owners to increase their rentability of their forest management. It will also provide the beneficiaries of the services an instrument to influence the forest owners to increase their supply of services which, without new markets, would be considered as externalities and therefore often ignored in their management. This concerns both governmental funded payment schemes, crowd-funding projects, or companies use of forest project in their corporative social responsibility activities. To increase the transparency of transactions between forest owners and buyers of services and to better assess the potential of such new markets, it is important to estimate the demand for services. Likewise, it is also important to assess the cost of increasing the supply of services to increase the transparency and also to assess additionality of projects. In this report we present and discuss different methods which have typically been used in assessing the preferences for forest ecosystem services or to estimate the costs of provision. Besides a brief introduction to the methods the report also makes references to more detailed technical guidelines and key scientific references. Finally, the report also gives an example of how a change in forest management may influence the values of carbon sequestration and recreational use of a forest project in the French NOBEL pilot demonstrator.