Monetary Valuation of Flood Protection Ecosystem Service Based on Hydrological Modelling and Avoided Damage Costs. An Example from the Čierny Hron River Basin, Slovakia

Flood protection is considered one of the crucial regulating ecosystem services due to climate change and extreme weather events. As an ecosystem service, it combines the results of hydrological and ecosystem research and their implementation into land management and/or planning processes including several formally separated economic sectors. As managerial and economic interests often diverge, successful decision-making requires a common denominator in form of monetary valuation of competing trade-offs. In this paper, a methodical approach based on the monetary value of the ecosystem service provided by the ecosystem corresponding to its actual share in flood regulating processes and the value of the property protected by this service was developed and demonstrated based on an example of a medium size mountain basin (290 ha). Hydrological modelling methods (SWAT, HEC-RAS) were applied for assessing the extent of floods with different rainfalls and land uses. The rainfall threshold value that would cause flooding with the current land use but that would be safely drained if the basin was covered completely by forest was estimated. The cost of the flood protection ecosystem service was assessed by the method of non-market monetary value for estimating avoided damage costs of endangered infrastructure and calculated both for the current and hypothetical land use. The results identify areas that are crucial for water retention and that deserve greater attention in management. In addition, the monetary valuation of flood protection provided by the current but also by hypothetical land uses enables competent and well-formulated decision-making processes.