Urban ecosystems: A new frontier for payments for ecosystem services

Abstract Urban ecosystems provide many benefits to people, including regulation of environmental conditions, recreational opportunities, and positive health impacts. However, many urban ecosystems are under pressure from increasing urbanisation, because the economic benefits they provide are rarely captured by the people who own and manage them. Such ecosystems are seldom economically competitive compared to more profitable residential, commercial, and industrial land uses. To develop more sustainable cities, we require new approaches for encouraging and enabling interventions that maintain, improve and create urban ecosystems. Payments for ecosystem services (PES) schemes are increasingly used to incentivise conservation and changes in environmental management in rural settings, but this approach has rarely been considered in cities. Here, we explain how payments for urban ecosystem services (PUES) could help protect, restore, and manage urban ecosystems. To implement PUES, we must understand the differences between various public and private actors who could potentially provide or benefit from urban ecosystem services. For example, utilities companies could pay for reduced water treatment costs via deculverting streams, homeowners could pay for improved stormwater management via increasing permeable surface area, and business proprietors could pay for street tree installation and maintenance to provide shade and reduce air conditioning costs. Urban densities, land values, and land tenure will impact the types of PUES projects that are most likely to be viable. To be successful, PUES will require an improved understanding of urban ecosystem service science—particularly how service provision changes under different land management practices. Nevertheless, because of the high densities, co‐location, and wide variety of stakeholders that live in cities, there is potential for PUES to become an innovative funding source to support future urban ecosystem management. A plain language summary is available for this article.