Valuing Natural Assets

Melbourne’s urban forests will improve health and wellbeing

Melbourne is leveraging the value of natural assets through a cohesive, metrowide urban forestry and biodiversity strategy, that will reduce the city’s heat island effect, mitigate flooding, foster social cohesion, and improve public health.

Natural assets, also called ecosystem services or natural capital, is a term for the environmental resources that create benefits for human society, such as water and air quality, natural flood protection, biodiversity, and even soil and minerals. In 2011, the value of our planet’s total natural assets was estimated to be between US$135 and US$157 trillion per year — for perspective, the nominal Gross World Product in 2016 was only about half that, around US$75 trillion. Despite their significant value, both economists and policy makers have long struggled to accurately assess and incorporate the value of natural assets into their decision making. And while those global figures include non-urban natural assets, cities are likewise negatively affected by undervalued or degraded ecosystems.

Decades of development have eroded the natural assets of cities, literally paving over the critical conditions and ecosystems that made a city’s location an ideal place for human settlement in the first place. This degradation of natural assets forces greater reliance on costly man-made interventions to protect against resulting risks, such as building expensive sea walls to protect communities from storm surges that natural systems like mangroves used to manage.

Australia possesses substantial natural capital, home to some of the world’s most unique wildlife and the unparalleled Great Barrier Reef. Its urban areas likewise depend heavily on their environments. The nation’s second largest city, Melbourne is “a vibrant and proudly multicultural city of 4.6 million residents, originating from more than 180 different countries. A ‘city of cities’, Melbourne is made up of 32 local government authorities (councils) spread over 10,000 square km around Port Phillip Bay, comprising hundreds of diverse local neighborhoods.”

Melbourne’s unique geography leaves it exposed to devastating disasters including extreme heat and bushfires, and sea level rise and flooding. In 2009, the city suffered a fire that killed 173 people and destroyed thousands of homes, with an accompanying heatwave that led to 374 additional deaths. As climate change increases both the frequency and severity of these types of events, the city today struggles with how to manage an expanding built environment against the loss of its natural assets.

Melbourne’s neighborhoods have developed with a wide range of population densities and a highly variable urban tree canopy; some of its 32 councils have the lowest tree canopy ratio in Australia. The city also contends with the “hardening” of once-arable land through rezoning for infill development and the development of new suburbs. The infrastructure built to keep pace with the sprawl has supplanted the vegetation that provided shade, absorbed the sun’s heat, and possessed a natural permeability adept at absorbing excess water; the many new roofs and roads cause greater destruction during flash floods and lead to more heatwaves.

These challenges were foremost in the minds of city leaders as they developed the city’s Resilience Strategy. In the past, greening projects took place piecemeal, without comprehensive coordination between local councils, and such efforts struggled to achieve the scale of impact the city requires. To better coordinate and create a standard for action, the first initiative in the Resilience Strategy document calls for the creation of a Metropolitan Urban Forest Strategy.

Melbourne, Australia

The Urban Forest Strategy will drive reforestation and natural asset development across the full metropolitan area, allowing the city to reclaim more of its natural biodiversity and the benefits it bestows. From a resilience perspective, a greener Metro Melbourne means shadier, cooler metropolitan areas, lower flood risk, and less storm water and damaging nutrients entering waterways and Port Phillip Bay. Furthermore, by aiming for a greener Metro Melbourne, the Urban Forest Strategy is expected to unlock further co-benefits for residents, including reduced obesity levels, better mental health, and more active lifestyles.

The first step in implementing this action is to create a compelling case for increasing biodiversity and urban forest cover in the city, and cultivate buy-in for the value of natural assets from a diverse range of stakeholders. To do this, the CRO’s office is collaborating with Platform Partner The Nature Conservancy to prepare a baseline assessment of metropolitan Melbourne’s biodiversity, as well as identifying financing options for implementation of the Urban Forest Strategy.

Platform Partners Digital Globe and Trimble are also supporting this baseline mapping. The city is actively inviting the participation and input of local councils, state government actors, and civic and research organizations in the development of its Urban Forest Strategy. Furthermore, the CRO’s office is building better knowledge and alignment across stakeholders on biodiversity through trainings and community meetings, including by forming a technical advisory group and a stakeholder reference group to enable a co-design process with state government, councils, and communities.

Finally, through a 100RC Network convening held in February 2017, CROs from five member cities (Boulder, Durban, Semarang, New Orleans, and Melbourne) met in Melbourne to investigate how to transform their cities through investment in natural assets, particularly biodiversity. As a result of this event, Melbourne has expanded its ambitions to explore the additional co-benefits of urban forests that link to biodiversity, including how investing in its natural assets could allow it to be more resilient to extreme weather events.

Across the Network: Natural Assets

Cities around the world are reclaiming the environment’s potential as a natural building block of urban resilience. To date, member cities have developed over 130 initiatives related to protecting ecosystems and valuing natural assets.

• ATHENS is investing in its urban green spaces while also improving the effectiveness of municipal governance structures through its “Major Green Areas Managing Authority” initiative. To address the disparate authorities currently managing the city’s green spaces, Athens is strengthening coordination and creating new partnerships that will support strategic and sustainable management. In so doing, the city aims to maximize its natural assets and protect existing infrastructure, making spaces within the built environment more integrated, accessible, and appreciated, serving the city’s broader resilience goal of integrating natural systems into its urban fabric.
• BRISTOL is developing a public-private partnership opportunity to deploy a Payments for Ecosystem Services model to protect natural assets, such as forests and green spaces, in the city and across its wider region. The city will develop a high-level assessment of the financial value of its parks. In addition, the Natural Capital Trust will coordinate funds from developers and beneficiaries to enhance the resilience value of projects from infrastructure to climate change adaptation efforts, in order to improve well-being throughout the West of England.
• DAKAR’S green spaces have declined in the midst of rapid urbanization and increased city development, leaving only a few parks in the city. The city is investing in rebuilding its public green spaces to combat the effects of climate change and gain from the benefits to public health and community engagement they provide. Dakar will create a greener city through public-private partnerships that support the development of new parks and gardens, the conservation of biodiversity, and stronger enforcement of land use policies.
• RIO DE JANEIRO faces a range of interconnected environmental and health challenges including intense rains, sea level rise, and poor sanitation. Protection of the city’s natural assets is a critical priority for developing long-term resilience. To address water security and livability issues, the city is creating a “Public Authority for the Guanabara Bay” that will remediate and improve metropolitan governance of the Bay, in turn activating the Guanabara’s economic and recreational potential. In addition, the city has planned a project of “Arbored Squares” which aims to revitalize 78 public squares by planting 50,000 trees, thereby mitigating urban heat islands and ensuring a majority of the population has access to a green area within a 15-minute walk from their home.