Conservation Strategy Fund (CSF-Brazil) analyzed the risks and benefits of the Environmental Reserve Quota (Portuguese acronym, CRA) markets in the state of Bahia, in the northeastern region of Brazil. The goal of this work is to support the government in the design of state law to ensure that CRA markets protect priority conservation areas.
In Brazil, rural properties have an important role in conservation of biodiversity and natural resources; rural landowners must keep at least 20% of their total area covered with native vegetation. These areas are called "Legal Reserves" (LR). The LR are intended to maintain ecosystem services and ensure the balance of ecological processes. Currently, it is estimated that the state of Bahia should have one million hectares protected as LR, but in fact that land is being used for other purposes (eg. agriculture, livestock, etc.). CRA markets have the potential to create incentives for rural landowners to create LR and bring their land use into compliance with the law.
From the analysis of different instrument implementation scenarios, we concluded that a scenario in which CRA markets are restricted only to areas defined as conservation priority areas would be most cost-effective. In other words, this market restriction would achieve greater environmental benefits at lower costs.
With this study, we aim to support the state of Bahia the design of CRA market regulation to achieve greater environmental results.
We had financial support from Good Energies.
Photo credit: Daniel Kieling.