PES marketplace development at the local scale: The Eugene Water and Electric Board as a local watershed services marketplace driver

Payments for ecosystems services (PES) is increasingly recognized as a way to protect and enhance ecosystems by linking beneficiaries and providers through various payment options and voluntary supply arrangements. The concept of the local marketplace, which uses a non-commodity, expanded view of the PES marketplace, has significant potential for non-fungible PES such as watershed services. Water utilities can be key drivers in development of such marketplaces as they are prominent actors in communities and watersheds, and they are typically strategically situated between PES purchasers and potential providers. This article explores the potential for local PES marketplaces and the role of water utilities in their development through a case study of the Voluntary Incentives Program (VIP), a PES initiative under development by the Eugene Water and Electric Board (EWEB) in Eugene, Oregon. Using a mixed method research approach to explore institutional and social acceptability issues, findings suggest strong support for the program, and for EWEB's role among providers and purchasers. Implications include, among other things, the significant potential for water utilities to act as local marketplace drivers and the importance of carefully designing local PES programs to meet local marketplace needs and support.