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Designing PES instruments can be challenging at the local level. Environmental services are often not clearly observable. Long term land-use trajectories are not well-known. The impact on ecosystem services of communities versus other confounding factors is difficult to disentangle. Requisite information for making decisions and designing projects is structurally scarce and costly to obtain. This study proposes a conceptual approach that potentially addresses these issues and assists project implementers in crafting incentive agreements at the local level. Dubbed BLACSI, it defines and structures data to be collected at the community and household levels about Baseline scenarios, Acceptable Changes and Support and Incentives.

TNC and IDDRI applied this approach as well as associated field methodologies in two villages in Berau district, in Indonesian, to test its efficacy in designing community incentive agreements. This approach is expected to be useful to practitioners: (1) When operationalized through a rapid assessment, the approach can be implemented quickly and cost efficiently to collect relevant data; (2) It contributes toward a stronger foundation for incentive agreements, as it collects data at the household level and facilitates discussion and negotiation at the community level. The approach builds consensus and promotes participation as well as procedural equity, which enhances sustainability; (3) questionnaires and focus group discussions can be tailored to local conditions. With no significant cost, the process can be designed based on the specific socioeconomic and environmental context of each targeted village. The Nature Conservancy (TNC) in Indonesia, the Institute for Sustainable Development and International Relations (IDDRI) in Paris, through the INVALUABLE project, and the Center for International Forestry Research (CIFOR) have release this report.

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