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Using Compensation Mechanism for Watershed Protection Services in Citarum
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Pilot and Demonstration Activities
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The Citarum river basin and watershed are used and abused by multiple users—water utilities, fishery, irrigation, and hydropower companies. But these users do not “pay” for the “environmental services” that the watershed provides. This PDA will help develop a compensation mechanism to protect the Citarum watershed. |
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The Citarum river is a major water source in Indonesia. It provides drinking water to Jakarta and other urban centers in West Java. Its three large reservoirs provide hydropower, irrigation water, municipal water supply, and aquaculture opportunities to Jakarta and Bandung. But these multiple users do not “pay” the watershed for the services it provides.
Local and provincial governments collect water tax but it is not clear where the money goes because the collected amounts are not earmarked. On the other hand, the effects of deforestation and catchment area degradation are becoming very evident with the increasing cases of flooding, land slide, siltation, and other forms of disasters resulting from deteriorating watersheds.
This PDA will help develop and demonstrate the use of a compensation mechanism for watershed protection services in Citarum. One of its expected outcomes is the formulation of a policy on payment for environmental services (PES). Recommendations to emerge from this PDA will be considered in the on-going preparation of ADB’s Integrated Citarum Water Resources Management Project.
This PDA will develop a compensation mechanism for watershed services. Specifically, it aims to:
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