Mitigating economic damage in Kenya's Upper Tana River Basin: An application of arc-view SWAT
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The Upper Tana River Basin is one of Kenya's most important natural resource bases. Its Masinga Reservoir supplies water and hydroelectric power for 65 percent of the nation. Unregulated deforestation and expansion of cultivation practices onto marginal soils has resulted in significant reservoir siltation, reduced ecosystem function, and more erratic downstream flows. An appraisal conducted for this study identified potential areas where reforestation could occur, enabling a doubling of the reforested areas currently in the Upper Tana River catchments. The Soil and Water Assessment Tool (SWAT) model was used to evaluate alternative reforestation scenarios. An economic model was developed to determine the opportunity costs associated with reforestation and the economic incentives, i.e. green payments, which would be required to induce upper catchment users to reforest. The analysis found that reforestation would decrease sediment loading in the Masinga Reservoir by 7 percent. Users in the upper catchment would be paid $33 for each ton of sediment they retained in their fields, but benefits were found to be insufficient for downstream users to sponsor green payments. Under an alternative price structure that targeted green payments to specific upstream producer groups the downstream benefits would increase, providing adequate incentives to implement green payments. The findings of this research can assist environmental policy implementation by the Kenyan government that will foster improved environmental results.