The quantity of ecosystem services produced from land cannot be readily measured at the site level needed for participation in ecosystem markets, or at a regional level needed to create ecosystem accounts. This paper applies biological scaling principles to develop a quantity metric in which areas of ecosystem (extent) scale allometrically to ecosystem services (a capacity measure) according to a scaling exponent defined by the fractal dimension of ecosystem vegetation. A key conclusion of this paper is that the quantity of ecosystem services arising from ecosystem degradation and conservation activities cannot be estimated unless information about the space-filling properties of vegetation is observed and included in the quantity measurement methodology. The paper demonstrates how remote sensing techniques can be applied to systematically measure ecosystem extent and fractal dimension. It illustrates the economic efficiency and environmental outcome implications of such a quantity metric through comparison with current quantity estimation methods that assume isometric scaling. The quantity metric proposed has potential applications to ecosystem accounting. It enables information currently reported in land accounts to be combined with information reported in ecosystem condition accounts to create ecosystem stock accounts measured in physical units.

The transfer of sediments through the landscape (sediment connectivity) depends on hydrological conditions. This study aimed at assessing changes in sediment sources engendered under extreme drought. A sediment budget model that considered hillslope sediment connectivity was applied to the Latrobe River catchment (South-east Australia) in a relatively normal period (1990-1996) followed by part of the 'Millennium Drought' (1997-2005). Bayesian inference was applied to optimize monthly streamflow and calibrate sediment parameters against mean annual specific sediment yields at ten monitoring stations. In 1990-1996, assessed sediment yield at the outlet was 68 kt/y; 60% of sediments originated from net hillslope erosion and 40% from streambank erosion. In 1997-2005, sediment yield decreased to 13 kt/y, 27% from net hillslope erosion against 65% from streambank erosion. During the drought, both hillslope gross erosion and hillslope sediment connectivity decreased dramatically. Streambank protection is of the utmost importance under all hydrologic conditions and especially during drought periods. (C) 2016 Elsevier Ltd. All rights reserved.

The aim of this study was to develop a bio-economic model to estimate the feasibility and net profit (or net costs)s of achieving set water quality targets (sediment, nitrogen and phosphorus load reductions) in the Burnett Mary region of northern Queensland, Australia to with the aim of protecting the southern portion of the Great Barrier Reef (GBR). Two sets of targets were evaluated – Reef Plan Targets (RPTs) which are the currently formally agreed targets, and more ambitious Ecologically Relevant Targets (ERTs) which current science suggests might be needed to better protect the values of the GBR. This paper describes the construct of a bio-economic optimisation framework which has been used to underpin a Water Quality Improvement Plan (WQIP) for the Burnett Mary region. The bioeconomic model incorporates the available science developed from paddock and catchment scale biophysical model results and farm economic analysis. The model enabled transparent assessment and optimisation of net profits and costs associated with four categories of best management practices (cutting edge unproven technologies called ‘A’ practice, current best-management practices called ‘B’, common industry or ‘C’ practices, and below industry standards or ‘D’ practice) in the grazing and sugar cane industries. The bioeconomic model was able to solve for RPTs or ERTs assigned to either the entire region or within each of five discrete river basins. Key outcomes from the study were that RPTs could be achieved at an annual cost of $3M/year on a whole of region basis. In contrast ERTs could be achieved on a whole of region basis at as net cost of $16M/year. ERTs were not able to be feasibly met on a basin by basin basis. This is the first time such a comprehensive and integrated bio-economic model has been constructed for a region within GBR using environmental software that linked available biophysical and economic modelling.

The south-west region of the Goulburn-Broken catchment in the south-eastern Murray-Darling Basin in Australia faces a range of natural resource challenges. A balanced strategy is required to achieve the contrasting objectives of remediation of land salinization and reducing salt export, while maintaining water supply security to satisfy human consumption and support ecosystems. This study linked the Catchment Analysis Tool (CAT), comprising a suite of farming system models, to the catchment-scale CATNode hydrological model to investigate the effects of land use change and climate variation on catchment streamflow and salt export. The modelling explored and contrasted the impacts of a series of different revegetation and climate scenarios. The results indicated that targeted revegetation to only satisfy biodiversity outcomes within a catchment is unlikely to have much greater impact on streamflow and salt load in comparison with simple random plantings. Additionally, the results also indicated that revegetation to achieve salt export reduction can effectively reduce salt export while having a disproportionately smaller affect on streamflows. Furthermore, streamflow declines can be minimized by targeting revegetation activities without significantly altering salt export. The study also found that climate change scenarios will have an equal if not more significant impact on these issues over the next 70years. Uncertainty in CATNode streamflow predictions was investigated because of the effect of parameter uncertainty. Copyright (c) 2012 John Wiley & Sons, Ltd.

Studies examining changes in long-term streamflow over large catchments invariably involve empirical approaches to simulating forest development and transpiration, and often classify land cover into broad groups such as forest or non-forest. Water use of different land uses depends on factors including climate, soil, landscape position, species and management, and is closely linked with vegetation growth. A forest growth model linked with a hydrologic model was applied to a forested catchment in southeastern Australia. Scenarios were developed to examine the effects of changes in land use and climate, and their combined effects, on evapotranspiration and streamflow generation within the catchment. Predictions suggest that catchments with a higher proportion of plantations are likely to experience relatively large reductions in streamflow under a drier and warmer climate. With deeper rooting systems, tree-based land uses are able to maintain higher ET than pasture-based systems in areas where water is not the most limiting factor, thereby reducing streamflow even further. Results indicate that at the catchment scale, water may begin to limit transpiration and rainfall interception only under a severe climate change scenario with 13.8% reduced rainfall and 2.4 degrees C increase in temperature. Results highlighted the importance of the length of simulation period and incorporating plantation age, because there are species-specific differences in the temporal development of LAI and water use. This study shows the value in adopting an approach in which forest growth is linked with hydrology to identify the contribution of land use in modifying catchment response to climate change. The proportion of the catchment covered by forests, plantations and pasture-based systems influence the degree to which total ET and streamflow is affected, and the spatial pattern of change across the catchment. The relationship between reductions in rainfall and reductions in contributions to streamflow are modified by land use, and leads to a far greater range and variability than suggested by integrated results at the catchment outlet.

Dryland salinity threatens many high-value assets in Australia. Assessing the technical feasibility of intervention requires consideration of spatial and temporal dimensions of land management and associated surface-groundwater interactions. This paper presents results regarding the practicability of protecting assets in a 371,000-ha agriculturally dominated catchment in south-eastern Australia using a physically-based catchment model, the Catchment Analysis Tool (CAT). The model links surface land management and hydrology at the paddock scale (daily time step growth and water use, crop rotations and management) with a fully distributed groundwater model enabling the assessment of agronomic versus engineering options for landscape asset protection. Scenarios assessing management options and costs of planting of perennial vegetation or engineering through groundwater pumping are outlined. The impacts of scenarios are reported under future climatic conditions as well as for the 'steady state' response. The study demonstrates a linked surface-groundwater modelling approach to estimate groundwater capture zones, response times to equilibrium under current and climate change conditions, as well as groundwater abstraction volumes required to protect landscape features. These factors are important considerations for evidence-based decision making about protecting assets from dryland salinity. Crown Copyright (C) 2011 Published by Elsevier B.V. All rights reserved.

Forest plantations for wood production are an increasingly important land use in southern Australia, and there are potentially important hydrologic consequences of what is mostly a change in land use from agriculture to silviculture. An ability to predict, with some degree of accuracy, the impact of plantation expansion on surface water and groundwater resources is essential. A validated process-based modelling approach, integrating the many interacting environmental and management factors which may influence plantation growth and transpiration, can be used for this purpose. The 3PG forest growth model has been evaluated for a number of species from widely differing climate and site conditions. While growth predictions have been validated, little attention has been given to testing the accuracy of the transpiration predictions or the model's representation of the water balance. We enhanced the 3PG forest growth model (known as 3PG+) and then integrated it into the Catchment Analysis Tool (CAT), so that it now interfaces with a more detailed multi-layered, daily time step representation of the soil water balance. Simulated transpiration using 3PG+ in CAT was compared with field measurements in 30 plots (across 15 sites) representing 5 common plantation species (Eucalyptus globulus, E. nitens, E. grandis, E. regnans and Pinus radiata) across ages 2–31 years. Mean daily plot transpiration during the measurement periods ranged between 0.4 and 4.2mmday−1 (average 2.0mmday−1). Simulated mean daily plot transpiration using 3PG+ in CAT for Eucalyptus was good (coefficient of efficiency=0.80; R2=0.81). While the model tended to slightly under-predict transpiration at higher measured rates (>3.5mmday−1), predictions at monthly timescales had acceptable accuracy. The integration of 3PG+ into CAT resulted in an improvement in accuracy and applicability of CAT, and provides for the spatial application of 3PG+ across diverse and mixed land use catchments for investigation into carbon and water movement in forest systems.

Introduction It is recognised that salinity in Australia is much harder to tackle than was widely appreciated a decade ago. There is also acknowledgement that tighter targeting is needed and a shift from a threatbased to an asset-based approach (Adamson 2007, McAlinden et al., 2003, Sparks et al., 2006). The Salinity Investment Framework (SIF3) was developed to help regions make more cost-effective and defensible decisions. SIF3 has been trialled in the North Central Catchment Management Authority (NCCMA) region in Victoria (Ridley and Pannell, this conference and www.sif3.org). Part of SIF3 involves identifying high-value assets, assessing the threat of salinity, and the feasibility and costeffectiveness of protection. To support SIF3, robust biophysical information is required.

Australian Spatial Data Infrastructure (SDI) is in need of a grid cell-based data component that supports the needs of landscape or environmental process modellers and other GIS users. Spatial data infrastructure and innovation diffusion concepts based on the Organisational Innovation Process are used to establish the innovative nature of this proposed component of the SDI and the process for its acceptance by key stakeholders in Australia. The experience of development of a Cooperative Research Centre for Spatial Information (CRCSI) Demonstrator Project, namely, Platform for Environmental Modelling Support (PEMS)is described to illustrate a collaborative model used by a group of public and private organisations to promote the diffusion of grid cell data infrastructure at the state and national level in Australia. The experience of the project suggests that in addition to the established collaborative environment offered by the CRCSI, investment in robust and structured project management is also important to facilitate future adoption of the grid cell data infrastructure by the participating organisations.

The Catchment Analysis Tool (CAT) is a hydrological model that helps to define the surface and subsurface movement of water and nutrients in a catchment, and evaluate the impact of different farming systems and land management strategies on vegetative growth and productivity, stream quality, streamflows and groundwater. It was created in response to a growing desire by decision makers to be able to examine modified landscapes and look at the trade-offs in biophysical responses such as, crop yield, soil erosion, salinity and water dynamics. The CAT captures the hydrological dynamics of the whole landscape by combining a suite of mature models that individually describe a variety of landscape processes such as crop growth, forest growth, grazing systems, water balance and groundwater models. The basic spatial and temporal input data required to run the CAT are generally commensurate with available data. These include land use, elevation, soil characteristics and climate data. Detailed analysis of groundwater systems and watertable mapping requires a full geophysical conceptualisation of the underlying groundwater systems and an extensive calibration process based on statistical optimisation, expert consultation, and modification of underlying assumptions about the groundwater systems being modelled. At the catchment scale there are very few points in the landscape where relevant data are measured and captured, and as such, validation of the CAT remains challenging. Where possible modelled results are validated against data captured from stream gauges, bore data and point studies. This chapter describes the CAT,discusses briefly the individual components and their linkages, and provides a case study example of how the CAT can be used to inform a policy decision. A discussion of the weaknesses and difficulties inherent in the creation of such integrative modelling frameworks is also presented.

An auction-based approach (or MBI for "market-based instrument") was used to purchase environmental services from landowners and to establish a long-term economic resource (forest plantations) in two catchments in the state of Victoria (Australia). The policy goal of the MBI was to encourage the conversion of cleared land to forest plantations. It was desired to achieve this while also reducing the amount of land affected by dryland salinity with minimum impact on water available for irrigation. Operationally, interested landowners identified areas on which they would be willing to establish forest plantations, and stated the amount of money they would require from the govemment to undertake plantation establishment; this constituted a landowner bid. The proposed planting area associated with each bid was processed through a quantitative hydrological model to estimate off-site impacts on dryland salinity and the change in water yield resulting from the conversion of individual non-forested areas to forest plantations. Landowner bids were then accepted or not based on the economic trade-offs among dollars requested by a landowner, reduction in water yield, and decrease in dryland salinity. To enable a comparison of costs, the MBI was independently trialled in two catchments. For both, the cost to government of a hectare of plantation and/or a hectare of salinity benefit was calculated a number of ways. Assuming the existence of a calibrated hydrological model, costs associated with distributing money via such an MBI were publicity, fieldwork, processing the bids through the model, probity, legal, and administration. In the Gippsland catchment, the total cost to establish forest plantations was $5340 per ha whereas it was $1635 per ha in the Corangamite catchment. No salinity benefit was obtained in Gippsland, but in Corangamite, if considered in isolation of the economic forest plantation benefit, the cost per hectare of salinity benefit was $5020. Operational aspects of the MBI are presented and discussed and a comparison is made to the expected costs of a conventional, non-science driven approach to landowner incentives. Crown Copyright (c) 2007 Published by Elsevier B.V. All rights reserved.

This article reports on an Australian auction to procure multiple environmental outcomes: EcoTender . EcoTender uses a Catchment Modelling Framework (CMF) to estimate the impact landholder actions have on carbon, terrestrial biodiversity, aquatic function (water quality and quantity), and saline land area. This framework solves the problem of linking paddock-scale land use and management to catchment-scale environmental outcomes. This is the first time a market-based instrument has been fully integrated from desk to field with a biophysical model for the purchase of multiple environmental outcomes. A multiple outcome auction provides several new economic and scientific challenges. This article discusses the EcoTender approach to incorporating agency preferences, modeling the joint production of environmental outcomes and reporting environmental scores. Results indicate that linking EcoTender to the carbon market reduced the cost of procuring the environmental goods by 26%. Further, preliminary estimates show that the environmental gains from scoring the joint production of multiple outcomes are between 30% and 50% to the agency.

Abstract This paper reports on a Catchment Modelling Framework (CMF) designed to support

This article reports on an Australian auction to procure multiple environmental outcomes: EcoTender. EcoTender uses a Catchment Modelling Framework (CMF) to estimate the impact landholder actions have on carbon, terrestrial biodiversity, aquatic function (water quality and quantity), and saline land area. This framework solves the problem of linking paddock-scale land use and management to catchment-scale environmental outcomes. This is the first time a market-based instrument has been fully integrated from desk to field with a biophysical model for the purchase of multiple environmental outcomes. A multiple outcome auction provides several new economic and scientific challenges. This article discusses the EcoTender approach to incorporating agency preferences, modeling the joint production of environmental outcomes and reporting environmental scores. Results indicate that linking EcoTender to the carbon market reduced the cost of procuring the environmental goods by 26%. Further, preliminary estimates show that the environmental gains from scoring the joint production of multiple outcomes are between 30% and 50% to the agency.

This paper reports on an Australian pilot (EcoTender) of an auction for multiple environmental outcomes. The success of the auction is due to a linkage between the auction process and an innovative Catchment Modelling Framework (CMF) used to estimate multiple environmental outcomes including carbon, terrestrial biodiversity aquatic function and saline land area. Auctions have been used in the past to distribute environmental funds. BushTender, a single dimension auction (one environmental outcome) demonstrated significant cost savings are achieved when compared to other grant based approaches (Stoneham et al. 2003). In general, auctions aim to provide private landholders with the incentive to truthfully reveal their cost of undertaking specified actions that produce environmental outcomes. If correctly applied auctions can help to overcome common problems involving asymmetric information - where landholders have information about the cost of undertaking an action but this information is hidden from the agency who is providing the funds. The agency needs both cost information from landholders and information about the environmental outcomes (missing information) provided by the proposed landuse change, to make decisions between environmental management options and allocate funds. This is the first time a market-based policy has been fully integrated from desk to field with a biophysical modelling framework for the purchase of multiple outcomes. The CMF incorporates a suite of one-dimensional plant-based models that are explicitly linked to a fully distributed 3D-groundwater model. This framework solves the missing information problem of linking paddock scale landuse and management to catchment scale environmental outcomes. The framework also incorporates a number of biodiversity algorithms that estimate current and future eco-system benefits. This framework provides the Victorian government with a replicable transparent evidence-based approach to the procurement of environment outcomes. The framework can be applied in any location if data are available for calibration and validation.

Abstract This paper reports on a,Catchment Modelling Framework (CMF) designed to support,an Australian pilot (EcoTender) of an auction ,for multiple environmental outcomes. The CMF is used ,to estimate ,multiple environmental outcomes including carbon, terrestrial biodiversity, aquatic function (water quality and quantity) and saline land area, information which was previously unavailable for application to environmental markets. This is the first time a market-based policy has been fully integrated from desk to field with a Catchment ,Modelling Framework ,for the purchase ,of multiple ,outcomes. The CMF incorporates a suite of one-dimensional plant-based models that are explicitly linked to a fully distributed 3D-groundwater model. This framework,solves the missing information problem,of linking paddock,scale landuse and management,to catchment,scale environmental outcomes. The framework,also incorporates a number,of biodiversity ,algorithms that estimate current and ,future eco-system benefits. This framework provides,the Victorian government ,with ,a replicable transparent ,evidence-based ,approach ,to the procurement,of environment outcomes. The framework,canbe applied in any location if data are available for calibration and validation. OECD Workshop on Agriculture and Water:Sustainability, Markets and Policies 14-18 November, 2005 2

The way land is employed and managed has a significant impact on the environment. Based on analysis of one region of Australia it has been estimated that changes in the landscape over the last 200 years have significantly increased the volume of stream flow; reduced the quality of water in rivers and streams; marginally increased the area of dryland salinity; and caused a large decrease in the stock of terrestrial habitat. While private landholders are rewarded for investment in commercial activities, such as commodity production, the current economic environment lacks incentives to reward investment in the environment. This paper reports on the results from a field pilot where landholders were exposed to a more "complete" set of markets including a tradeable emission permit for carbon (a private good) and an auction of conservation contracts for public goods including habitat, water quality and dryland salinity control. The pilot illustrates that the new institutions created provide an economic environment in which landholders determine the optimal mix of commodity production and environmental goods and services. An efficiency gain of at least 30% was achieved when information asymmetry (adverse selection) was resolved. Moral hazard problems were only partially addressed in the pilot. There are residual contract design issues to be resolved, including those relating to attribution of outcomes, multiple outcomes, long time scales and learning contracts. Finally, the pilot illustrates that there are potentially large savings to government from creating markets for different environmental goods and services because of the multiple outcomes that are derived from land use change. Carbon emitters were shown to partially fund the production of public goods such as habitat, water quality and salinity control.