Environmental Compensation: Key Conditions for Increased and Cost Effective Application

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October 2015
Anders Enetjärn, Scott Cole, Matleena Kniivilä, Svein Erik Hårklau
Nordic Council of Ministers
norden environmental compensation

Environmental impacts are increasing due to human activities. The overuse of the benefits nature provides us is the direct result of our failure to put a price on these benefits. One way of addressing this is to require environmental compensation.

This study provides an overview of key conditions for increased, flexible and cost-effective application of compensation. It shows that for a relatively small cost, society can make a significant investment in the provision of biodiversity and ecosystem services by requiring compensation.

The study outlines three main recommendations on how to increase the use of environmental compensation: stimulating supply of, and demand for compensation; clarifying guidelines and legal framework; and strengthening Nordic cooperation on compensation.