Ecosystem service valuation in Kalu Oya and Mudun Ela basins, Sri Lanka

The Kalu Oya and Mudun Ela basins in Gampaha District of Sri Lanka are peri-urban sub-catchments of the Kelani River Basin, covering 78 km² with a population of 548,232. Their 10.50 km² wetlands provide essential ecosystem services including flood mitigation, water purification, biodiversity support, carbon storage, and urban agriculture. Despite their value, these wetlands face severe pressures from urban sprawl, encroachment, pollution, solid waste disposal, and invasive species. Despite conservation efforts by government agencies, degradation persists due to urban expansion and insufficient recognition of wetland value. This study is an attempt to assess and value ecosystem services using two approaches. The market price-based and benefit transfer method evaluated 13 wetland-specific services, estimating total economic value (TEV) at USD 25.1-27.6 million for 2025. Key services included carbon storage, flood attenuation, and biodiversity. Excluding static carbon stock values yields an annualized estimate of USD 12.98-14.45 million. The Co$tingNature model assessed 11 ecosystem services basin-wide at 30m resolution, estimating a 25-year TEV of USD 1.67 billion (USD 66.8 million/year). Though wetlands represent only 2.7% of basin TEV, they demonstrate exceptionally high per-hectare values (USD 6,807/ha/year average). Conservation investment analysis shows positive returns of 23-341%, depending on included costs. The study emphasizes wetlands' critical role, particularly in flood mitigation and carbon storage, and calls for prioritizing conservation investments while balancing local needs with long-term sustainability. Different valuation methodologies produce varying results depending on their conceptual foundations and data sources.