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Building Blue Carbon Projects
An Introductory Guide
cost-effective and economically and financially feasible than plantation style reforestation
techniques.
In many cases the economic value of the other ecosystem services will significantly exceed the
value of Blue Carbon, especially given relatively low current international demand and prices for
such carbon credits. However such values typically do not translate into the willingness of buyers
to pay for such benefits, though there are increasing efforts to account for such values within
national accounting systems
2
.
Under most circumstances and conditions, for those entities contemplating the development of
Blue Carbon projects, as with other carbon credit projects, it is important to assemble an expert
team. Engaging knowledgeable experts, the relevant carbon standard authorities, and potential
donors/buyers of future credits will help determine the eligibility and prospects. It will also help
develop estimates of the associated benefits and costs, prior to making final decisions to embark
upon project implementation.
For example, in the case of the Abu Dhabi Blue Carbon Demonstration Project, such preliminary
analysis has indicated that the total value of the suite of Blue Carbon ecosystem services
associated with increased conservation of such areas would have a strongly positive NPV, whereas
the development of Blue Carbon credits associated with mangrove afforestation and reforestation
alone, without accounting for the other ecosystem services, would have negative NPVs. While this
analysis is based on a number of assumptions, estimates and extrapolations, and so needs to be
further refined before any definitive conclusions can be made, it has been instructive in helping to
determine which approaches to explore to ensure the generation of Blue Carbon ecosystem
services in the future.
Further information
on economic considerations for Blue Carbon can be found in the following:
Key takeaways:
Economic analysis of a Blue Carbon project values the full range of ecosystem services
provided by a system and is done in a broad, socio-economic context.
Financial analysis is likely to move a project forward based on the expected revenue from
carbon credit sales.
Economic and or financial analysis may illustrate that other ecosystem services provide more
value than the carbon itself.
2
For more information refer to the Wealth Accounting and Valuation of Ecosystem Services (WAVES) Partnership of the World Bank
.
Green Payments for Blue Carbon: Economic Incentives for Protecting Threatened Coastal Habitats
(Murray
et
al
., 2011)
