Assessment of Ecosystem Services of Water Reservoirs/HPP dams in the Kura-Araz Basin

Abstract

This study focuses on freshwater ecosystem services that support hydropower plants (HPP)/dams development in the Kura-Aras River Basin in Azerbaijan. The study assesses the HPP/dams sector, and reviews additional sectors including nature-based tourism, irrigated agriculture, and drinkable water supply. In addition, the study briefly discusses the role and value of ES that help to mitigate natural hazards related to poor ecosystems management. The study used a basic Targeted Scenario Analysis (TSA) approach. The TSA assesses current “business as usual (BAU)” ecosystems management practices and its current value of ecosystems services under BAU. It uses sector output indicators and compares with potential “sustainable ecosystems management (SEM)” outputs to assess losses and potential gains (or losses) of shifting from BAU to SEM. The BAU approach is characterized by a focus on short-term gains (e.g., < 10 years), externalization of impacts and their costs, and little or no recognition of the economic value of ES, which are typically depleted or degraded. Under SEM, the focus is on long-term gains (> 10 years); also under SEM, the costs of impacts are internalized. Ecosystem services are maintained, thus generating potential for a long-term flow of ecosystem goods and services that can enter into decision making. SEM practices tend to support ecosystem sustainability as a practical and cost-effective way to realize long-run profits.