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Indonesian peatlands rarely experienced fire until recent decades10. Large fires are now a regular occurrence11, with the two largest fire events on record occurring in 1997 and 201512,13. Fires generally occur during periods of drought14, and are closely linked with land-use change15,16. Drainage and deforestation of extensive areas of peatland in Indonesia make the naturally fire-resilient peatland susceptible to fire17,18. Fires lit to clear land can burn out of control and spread into degraded forests and peatlands, particularly during El Nio years.
Due to the detrimental impacts of fires, a moratorium on any new land conversion on peatland was brought into effect in Indonesia in 201134, and in 2016 the Peatland Restoration Agency (Badan Restorasi Gambut, BRG) was established to restore and re-wet 2.49 million hectares of degraded peatland35. Fires are more likely to occur on degraded land than in protected areas of forest18,36, and drainage canals can make fires 4.5 times as likely17. Controlling land-use change and blocking drainage canals on peatland should therefore reduce fire and associated emissions. Since the spread of peatland fires is dependent on the water level37, re-wetting peatlands can be important for controlling fires. However, restoring degraded peatlands is challenging and large-scale efforts to restore tropical peatlands are in their infancy38.
Recent studies have found that the moratorium on land conversion may not have been effective in reducing deforestation or fires39,40. There have so far been no comprehensive estimates of the potential impacts of peatland restoration initiatives on fire occurrence. Crucially, large-scale restoration efforts to address fire-related problems lack a cost-benefit analysis41.
To help address this gap, we estimated the impact of peatland restoration on fire and the associated loss and damages caused by fire. First, we estimated the loss and damages caused by Indonesian fires in recent years, finding US$93.9 billion in economic losses from the six largest fire events. Second, we estimated the losses and damages under a scenario where 2.49 million hectares of degraded peatland had been restored, finding a reduction in economic losses of US$8.4 billion. By contrasting this benefit against the estimated costs of restoration, our analysis demonstrates that the benefits of effective peatland restoration will outweigh the cost of restoration, and provides evidence to support ongoing peatland restoration efforts.
Economic losses due to damages to agriculture, plantation, natural forest and other land covers were estimated by combining the area burnt with the net present value of each land use. The greatest cost from damages to land cover occurred in 2006 (US$11 billion) and 2015 (US$9.4 billion), with costs in other years between US$4 billion and US$7 billion. The damages to plantation crops and natural forest made up the majority of these losses (Fig. 1). In using one value for each land use, consumer and producer surplus have not been considered, and the true economic losses due to fires may differ.
The World Bank22 estimates the economic cost of the 2015 fire event to be US$16.1 billion, less than suggested in our study, largely due to the lack of long-term health impacts in the World Bank estimate. The estimate of costs due to damage and loss of agriculture and forest in the World Bank study (US$8.7 billion) is similar but smaller than our estimate (US$9.4 billion), despite them also including equipment damage. This could be because the World Bank used burned area from the Global Fire Emissions Dataset, which has previously been found to be underestimated in the region43. The cost from sectors not included in our study has been estimated at US$3.4 billion22.
Landowners use fire to clear land because it is can be easier and cheaper than other methods such as mechanical clearance44. Guyon and Simorangkir45 find that clearing forest without the use of fire has increased labour and equipment cost. We estimate the reduced costs of using fire to clear forest, compared to other mechanical clearance options, to be up to US$1.2 billion across the 6 years studied. This includes both forest that has been intentionally cleared as well as forest destroyed by fires that escape into surrounding land, so will be an overestimate of the reduction in costs. Despite this, the economic losses caused by damage to agriculture, which totals US$23.5 billion over the six years we study, are much greater than the reduced costs of using fire versus other land clearance options. Despite the economic losses caused by fire (e.g. due to damages to agricultural land) exceeding the economic savings of using fire to clear land, small-scale farmers may not have access to mechanical equipment44. This means many farmers may have little option but to continue to use fire. Morello et al.46 suggested that for the Amazon, a policy of subsidising mechanical clearing equipment improves the effectiveness of banning fire. Mechanical clearing is an effective way of maintaining existing agricultural land and could be more widely adopted if equipment was more widely available44.
Peatland restoration involves blocking drainage canals to restore water levels and re-establishing vegetation cover47. Large-scale peatland restoration in Indonesia has just begun, and it is too early to measure the effect on fire48. Instead, we used fires observed within protected areas as a proxy for fire occurrence on restored peatland. Peatland in protected areas is largely undrained and still covered in vegetation but is still subject to drought and anthropogenic pressures meaning that protected areas experience degradation, deforestation49, and fire, albeit at a lower rate than surrounding unprotected land49,50,51,52. Protected areas therefore provide a useful indication of the susceptibility of restored and re-wetted peatlands to fire under existing climate and anthropogenic pressures.
Fires are heavily concentrated in regions of peatland degradation and land-use change. In 2015, 53% of fire detections occurred on peatlands which covered only 12% of the land, with the greatest fire detection over degraded peatlands55. Prioritising areas for peatland restoration is therefore important. We selected locations with the greatest emissions from fires in previous years, which optimised the reduction in emissions. Randomly allocating the 2.49 MHa of restoration reduces emission reductions by more than half (Fig. 4) demonstrating that targeting restoration is important if benefits are to be maximised. Carbon emissions are greatest the first time a peatland burns and typically decline with subsequent fires56. Restoring unburned peatlands in areas of high fire risk will therefore lead to the greatest reduction in emissions. At the scale of our analysis, areas designated for restoration will include both burned and unburned peatland.
We have treated each year individually, and calculated the reduction in costs that could have been achieved if the peatland had been restored prior to each fire event. This provides an indication of the potential savings that restoration could provide for similar fire events in future years. Predicting the cost of fires in the future under business as usual and peatland restoration scenarios is challenging, due to the complex combination of meteorological and anthropogenic drivers of fire. In addition, a range of physical, social and economic feedbacks in the system21 further complicate the response and have not been assessed here.
The cost of peatland restoration may not have to be fully borne by Indonesia. A reduction in Indonesian fires yields health benefits across Indonesia, Malaysia and Singapore. Lin et al.65 suggests that Singaporeans are willing to pay US$643.5 million for the health benefits of reduced fire. Carbon emissions and climate change are also a global problem. Our analysis further confirms the need for fire to be considered in Reduced Emissions from Deforestation and Degradation (REDD+) programs66.
There are a range of uncertainties in our analysis. Estimates of the losses and damage to crops, plantation and forest conflate uncertainties in burned area, uncertainties in land-use mapping and the value of different land covers. Estimates of economic costs of CO2 combine uncertainties in burned area, biomass consumption linked to vegetation loads and burn depth and emission factors67, as well as the damage value associated with CO2. Emission estimates do not account for declining emissions from recurrent fires on drained peatlands56. Health impact estimates combine uncertainty in exposure to particulate matter with uncertainty in concentration response functions and economic costs of health impacts. Despite this large range of uncertainties our estimates are consistent with previous estimates of emissions23,24,68, population exposure to particulate matter25,69,70, associated health impacts24,25,26, and economic costs22. 152ee80cbc
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