Executive summary
Introduction and who this work is aimed at
Read More
Executive Summary >> Part One >> Part Two >> Part Three >> Part Four >> Glossary >> References
Part Four of this work explores the value of the HE estate with reference to its ecosystem services and natural capital.
Natural capital refers to the world’s stock of natural resources and ecosystems, from which we draw essential flows of goods and services[1]. It includes renewable resources (such as forests, fresh water, fisheries) and non-renewable resources (such as fossil fuels and minerals) which together supply a wide range of ecosystem services to humans.
Ecosystem services include the supply of natural resources themselves, as well as the processes which maintain environmental balance and support life, including climate regulation, pollination, water purification, nutrient cycling and many more.
These services form the bedrock of all human activity. They are essential for sustaining both the modern economy and human life itself[2]. Nature also provides humans with a range of “cultural” ecosystem services – which reflect the importance of nature in human culture, recreation and spiritual wellbeing.
The value of all this is a complex question. Some dimensions of the natural world are considered to have intrinsic value, which cannot and should not be quantified or priced[3]; and traditional accounting systems reflect poorly the indispensable role of nature in sustaining human life.
Ecosystem services are often supplied by nature free of charge. While traditional accounting treats such services as externalities (and as such puts no price either on the benefits they provide or on the costs of depleting them), natural capital accounting offers a framework reflecting true benefits and costs associated with our dependence on the natural environment for all our basic resources.
Some of these benefits may flow to the landowner (for example, the contribution of wetlands towards flood protection), but much of it is available to all of society as public goods (for example, the flood protection that the land may offer to a wider area, as well as sequestration of atmospheric carbon, absorption of air pollution etc).
The UK Government acknowledges the value of natural capital and has been producing annual accounts of the nation’s natural capital since 2011. Legislation such as Biodiversity Net Gain[4] also recognises this value and seeks to improve it at the national level.
The UK Natural Capital Accounts, compiled by the Office for National Statistics[5], provide estimates of the flows of critical ecosystem services across different habitats/land use types in the UK. Where feasible, the Accounts also provide estimates for the monetary value of the relevant ecosystem flows, and an estimate of their values as assets with reference to general national accounting conventions.
The UK’s accounts are informed by the United Nations’ System of Environmental-Economic Accounting[6], a global framework which aims to support consistent valuation and accounting for environmental factors across countries.
These developments at the national and international policy levels reflect a global trend towards true accounting for externalities, thereby addressing one of the key weaknesses of incumbent accounting systems[7].
The key point for our work here is that nature and the services that it provides have value, aside from the commercial value of the land that carries them.
The land-rich UK HE sector holds substantial natural capital. A forward-looking view might seek to consider how natural capital and other non-monetary dimensions could be integrated into decision making. We offer some first steps towards that in this work.
This report provides a first estimate of the natural capital and ecosystem service flows supplied by the UK HE sector’s lands. This estimate is based on top-down data modelling and misses much of the richness of the on-the-ground features of the sites themselves.
More detailed natural capital assessments of the lands at individual institutions would add depth to this picture and allow for testing of these first estimates.
We consider the following ecosystem services, which pass our conditions that i) they relate to the relevant land cover types (rather than other land covers such as croplands, marine environments etc); and ii) are not extractive[8].
Ecosystem services: definitions and metrics
This group of ecosystem services includes both services which are defined by the supply and may not be fully used (eg. water provisioning) and services which are defined by the use value created (eg. renewable electricity generation from sunlight and wind). While it might be difficult to increase the quantity and hence value of some services such as water over short time periods, by these definitions it is relatively easy to increase value captured for renewable electricity. This relates to our discussion of opportunities in Part Three.
The capacity for ecosystems to deliver ecosystem services is generally influenced by three factors: the extent of the ecosystem, its condition, and its spatial configuration (which can reflect factors such as fragmentation and ecosystem connectivity).
We do not have one dataset on the quality of ecosystems in the UK or for the UK HE estates dataset. But we do have two datasets which can be used to some extent as proxies, which are included in our sector map:
Sector map datasets: biodiversity and soil carbon
Both of these datasets are at too low a resolution for institutions to obtain granular information on the condition of their land and ecosystems, which can vary at a local level. They do however offer a high-level view of two important markers of natural capital quality across the country. Mapping BII values to land covers also confirmed our hypothesis that trees and grass would have higher BII values (0.81 and 0.79 median values respectively) than built environment (0.72).
Natural capital assessments at individual institutions will allow for better assessment of the quality of ecosystems and the services they provide.
The physical flows of ecosystem services are measured in the UK Natural Capital Accounts each with different metrics as set out above.
Each land use type also has a different profile in terms of the ecosystem services it provides. For example, woodland doesn’t provide renewable electricity provisioning while urban environments do; but woodland sequesters carbon while urban environments are net emitters of carbon.
It is worth noting again that all calculations here are based on top-down estimates and assumptions rather than bottom-up calculations based on individual sites.
We have mapped the land cover categories from the Natural Capital Accounts to our categories with the following correspondences. Of our categories, only built, trees, grass and water are material in the UK HE estate; and our natural capital datasets do not include the “cropland” or “other” categories.
UK HE land use categories and mapping to UK Natural Capital Accounts
From the Natural Capital Accounts data, we used a “value transfer” approach[9] to calculate the typical physical flows of the relevant ecosystem services on a per hectare basis for each land cover category. We were then able to estimate the total flows for university lands based on the total extent of each land cover category.
The value transfer approach being based on such generalised figures cancels out a large amount of richness and specificity on the ground (for example, it would not capture the renewable electricity generated by the on-the-ground sector examples that we explored at the end of Part Three); but it offers a useful estimate for large land areas where site-specific assessments of natural capital have not been undertaken.
The total physical flows of the relevant ecosystem services and per hectare flow values are shown below.
UK HE estate natural capital: annual physical flows of ecosystem services (variable metrics)
The data for physical flows contains no totals because each flow has a different metric. The greenhouse gas regulating data contain both positive and negative figures: the positive figures indicate net carbon sequestration (by woodland and grassland), while the negative figures indicate net carbon emission (by urban land and water/wetlands[10]).
We can also note that the total physical flows provided by each land cover type are conditioned by their extent. For example, woodland sequesters around 3,700 tonnes of CO2e (tCO2e) while grassland sequesters around 6,100 tCO2e – nearly double. But the extent of grassland on university lands is nearly four times the extent of woodland.
Looking at the per hectare figures, we can see that on a per hectare basis, woodland sequesters nearly twice the amount of carbon (0.005739 thousand tonnes CO2e or 5.739 tCO2e per ha) as grassland (0.003199 thousand tonnes CO2e or 3.199 tCO2e per ha).
The per hectare value transfer figures – although notional to the extent that they are assumptions-based and cancel out local details – provide an effective sense of the relative values in ecosystem terms for different types of land cover.
UK HE estate natural capital: annual physical flows of ecosystem services per hectare (variable metrics)
The UK Natural Capital Accounts set out their methodology for estimating the monetary value of certain ecosystem services in the 2022 Supplementary Guidance to the Treasury Green Book (Section 9. Non-market Valuation and Unmonetisable Values)[11].
To support alignment and comparability with the national accounts, we use the same approaches to estimate the monetary value of the ecosystem services supplied by the UK universities’ lands.
These are presented below, in millions of pounds at 2023 prices. They are broken down by land use type.
Converting the diverse range of ecosystem services and indicators of the physical flows they supply into monetary values involves some degree of abstraction and assumptions, however one benefit is that it can express the diverse services in common terms, which can be aggregated into totals. Due to the approaches used to calculate both the physical flow of ecosystem services (land transfer from generalised data) and their monetary valuation, it is likely that the natural capital value of lands examined in this work is underestimated.
The below table of annual flows contains totals for all services at the bottom, whereas this was not possible in the previous section as the metrics for physical flows were different for each ecosystem service.
UK HE estate natural capital: monetary value of annual physical flows of ecosystem services
The above data represents aggregate values (in millions of pounds) for the estimated value of ecosystem services across all the sector’s lands (remembering that the areas of different land use types are different, with more grassland than woodland for example).
We can also break this down into the relevant value of the ecosystem services supplied per hectare of land (which we have scaled down to pounds rather than millions of pounds, to provide more legible values).
UK HE estate natural capital: monetary value of annual physical flows of ecosystem services per hectare
This data brings out most clearly the natural value of the different land use types:
- Water (which has something of a porous boundary with wetlands due to challenges of geospatial data sensing)comes out as an extremely valuable environment due to the water provisioning it supplies, as well as other services including renewables, air pollution regulating and health and recreation benefits. The negative value of this habitat – at present – is that, due to the poor condition of many wetlands, they are assumed to be a net emitter of carbon, and therefore have a negative value for carbon regulation (which effectively indicates erosion rather than creation of value). Generalised “value transfer” figures hide a large amount of local variation, and wetlands can be transformed into carbon sinks through restoration: an important opportunity which we have not been able to explore in detail here.
- Grass is valuable for carbon sequestration (although not as valuable as woodland), and has the best potential for renewable energy generation and marginal regulation of air pollution.
- Built land displays opportunities for renewable provisioning (some of which we have discussed) but emits carbon on the balance. The health and recreation benefits are the highest per hectare for the urban environments, although this may reflect – as the metric is based on actual visits – the fact that they are more accessible than the other land cover types.
- Trees come out as the most valuable land use type in natural terms, primarily due to their substantial ability to sequester atmospheric carbon, as well as absorbing air pollution and their health and recreation value.
As we mentioned above, some of the ecosystem services are estimated by the services supplied (eg. water provision), while some are estimated by the services harnessed (eg. renewable electricity provisioning).
If universities were to take up some of the opportunities around renewable energy generation explored in Part Three at a greater pace and scale, the measure of renewable electricity provisioning ecosystem services (at least those picked up on site-specific, bottom-up assessments) would increase on those specific sites.
This shows the value of institutions undertaking local natural capital assessments based on site-specific data, building on the value transfer approach we have used for this initial assessment.
This data will allow institutions to make high-level estimates around the natural capital of their estates by combining the per hectare value transfer figures with the data on land cover data of their estates.
We can see that different types of land use have different profiles for the ecosystem services they supply.
When all the ecosystem services are taken into account, trees are the most valuable land use type in terms of the natural capital they carry in every hectare; although water/wetlands, grassland and built land all have one service which they supply more effectively than the other surface types. When these are aggregated across large areas, the impacts of different land use choices can be substantial.
UK HE estate natural capital: monetary value of annual physical flows of ecosystem services per hectare
Valued as assets[12], the natural capital value of the ecosystem services provided by the HE estates lands are worth around £250 million. This represents a substantial asset for the sector.
UK HE estate natural capital: total asset value of ecosystem services
Of the areas that we have explored, natural capital is the most developmental. As such, it stands at present as a less proximate opportunity for institutions than the opportunities for renewable energy, for example.
That said, there already exist both policy and market-based frameworks which reflect various dimensions of the value of natural capital and ecosystem services.
In the UK, Biodiversity Net Gain legislation[13] (inserted by the Environment Act 2021 into the 1990 Town and Country Planning Act) is already applicable for planning and construction. It requires that most new developments deliver a 10% increase in biodiversity compared to the pre-development state.
Biodiversity gain may be achieved through various approaches to creating new habitats (that is, land use change to more biodiverse ecosystems such as afforestation or creation of wetlands) or improving the condition of existing habitats[14].
The legislation also includes market-based mechanisms around transferrable “biodiversity units”, which effectively reflect the value of natural capital. Such mechanisms[15] (one dimension of what are commonly referred to as “nature markets”) are relatively nascent. But as they continue to mature in the UK and internationally, new economic opportunities may arise around the stewardship and improvement of nature and natural resources.
Equivalent models are also in play around carbon sequestration – for example the Woodland Carbon Code[16] and Peatland Code[17], both of which offer credits for the creation or restoration of ecosystems which draw down carbon from the atmosphere and which can be used to “offset” an organisation’s carbon emissions.
Participation in “carbon market” mechanisms is currently voluntary for most organisations outside high-emissions sectors which are subject to the UK Emissions Trading Scheme. And while the effective and ethical functioning of carbon markets has been subject to both scrutiny and controversy, they do offer opportunities for channelling critical investment for decarbonisation to where it is needed.
Partially in response to concerns around the credibility of offsetting schemes through the open market, some UK institutions have turned to approaches which involve carbon sequestration on their own lands. Such approaches, often referred to as “insetting”, offer the advantage that the institution can ensure the quality of the interventions and measure their impacts effectively.
The University of Edinburgh’s Forest and Peatland programme and the University of Leeds’ Gair Wood are two well-known examples[18].
It should be noted that both of these initiatives were developed on lands owned by the universities outside their core estates (which are the focus of this report) – again demonstrating the complexity surrounding universities’ options around land use, which include the opportunity costs of decisions against the other potential uses of the land in question and the associated, potentially multiple, values for different stakeholders.
Sector resources relevant to this part of the report include EAUC’s Biodiversity Strategy and Action Plan Guide and Template[19]. The organisation Nature Positive Universities[20], a partnership between the University of Oxford, UNEP Youth & Education and the UN Decade on Ecosystem Restoration, also supports institutions in the UK and across the world in improving their footprint on nature and biodiversity.
We hope that this work offers an additional light on some of the opportunities and why they matter.
As with renewable energy, many institutions have already implemented initiatives to create new ecosystems or improve existing ones. Here we present some examples from desk research.
Again, the examples include both interventions on core estates and on other lands. Links for further information are included in the footnote[21].
On the ground examples of initiatives to support nature and biodiversity
Find out more about SUMS Consulting
SUMS is a membership, not-for-profit organisation and registered charity, owned by our member universities.
Our sector-leading consultancy services for universities and the higher education sector cover many of the topics addressed in this report, including all areas of sustainability as well as risk, estates, local and regional partnership, strategy, planning and delivering change.
If you would like to discuss any of the topics explored in this report, hear more about impactful work we have done for institutions across the HE sector, or if you are looking for a partner to help you meet your organisation’s challenges and identify opportunities to thrive, please get in touch.
Potential steps include:
- Free of charge: A facilitated follow-up (a 60-minute virtual call with PVC/COO or their delegate) to explore specific questions as relevant to your institution and how you could respond, based on SUMS knowledge and insight.
- From membership days or our standard day-rate: A half-day or 1-day workshop directed at senior executives to explore the topics in more detail and develop a forward agenda. This can either be standalone or can build on earlier SUMS support, providing an opportunity for deeper discussion informed by additional data now available.
Our sustainability consulting services are delivered in partnership with EAUC, the sustainability champion for universities and colleges in the UK and the Republic of Ireland.
Notes and references
[1] See Natural Capital Coalition. 2016. Natural Capital Protocol.
[2] See World Economic Forum. 2020. Nature Risk Rising: Why the Crisis Engulfing Nature Matters for Business and the Economy.
[3] See Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES). 2022. Methodological Assessment Report on the Diverse Values and Valuation of Nature.
[4] See Schedule 7A of the Town and Country Planning Act 1990 (as inserted by Schedule 14 of the Environment Act 2021). Available at the link: https://www.legislation.gov.uk/ukpga/2021/30/schedule/14/enacted.
[5] Available at: https://www.ons.gov.uk/economy/environmentalaccounts/bulletins/uknaturalcapitalaccounts/2024.
[6] See United Nations. 2012. System of Environmental Economic Accounting 2012 – Central Framework; United Nations. 2024. System of Environmental Economic Accounting – Ecosystem Accounting. Available at the link: https://seea.un.org/content/methodology.
[7] For individual organisations, the Capitals Coalitions’ Natural Capital Protocol and Integrated Capitals Framework offer a framework for how such dimensions can be accounted for effectively.
[8] Ecosystem services which are represented in the UK Natural Capital Accounts but which we have not considered here are agricultural biomass provisioning, coal provisioning, fish provisioning, minerals and metals provisioning, oil and gas provisioning, timber provisioning, woodfuel provisioning, urban heat regulating, recreation and aesthetic (house prices), recreation and tourism (expenditure). This is because these ecosystem services either are not relevant to HE land, are extractive, or do not have the full datasets needed for processing.
[9] See Costanza, R. et al. 2014. Changes in the global value of ecosystem services. Global Environmental Change 26: 152–158.
[10] Wetlands can be net sinks or net emitters of carbon, depending on their condition. The aggregate condition of wetlands in the UK is assessed to be such that they are net carbon emitters, but this depends very much on the quality of individual sites and improvement can move sites from net emitters to net carbon sinks. Not being able to show this in high level analysis is a weakness of the value transfer approach.
[11] Available at: https://www.gov.uk/government/publications/the-green-book-appraisal-and-evaluation-in-central-government/the-green-book-2020#a1-non-market-valuation-and-unmonetisable-values. Not all ecosystem services can be assigned a monetary value; and these are generally not included in natural capital accounting systems.
[12] We follow the methodology used in the UK Natural Capital Accounts for calculating asset value: renewal resources are assumed to have a 100-year asset value, with NPV discount rates as follows: years 1-30 = 3.5%, years 31-70 = 3.0%, years 71-100 = 2.5%. For further information, see Office for National Statistics. 2024. UK natural capital accounts methodology guide: 2024.
[13] See https://www.gov.uk/guidance/biodiversity-net-gain.
[14] See https://www.gov.uk/government/publications/statutory-biodiversity-metric-tools-and-guides.
[15] See Taskforce on Nature Markets. 2023. Making Nature Markets Work. Shaping a Global Nature Economy in the 21st Century.
[16] See https://www.woodlandcarboncode.org.uk/.
[17] See https://www.soilassociation.org/certification/forestry/carbon-schemes/peatland-code/.
[18] See https://sustainability.ed.ac.uk/operations/forest-peatland and https://leaf.leeds.ac.uk/gairwood/.
[19] See https://www.eauc.org.uk/biodiversity_guide_and_template.
[20] See https://www.naturepositiveuniversities.net/.
[21] https://www.durham.ac.uk/about-us/professional-services/energy-and-sustainability/news/2024/creation-of-new-wetland-areas/; https://www.lancaster.ac.uk/sustainability/news/lancaster-joins-nature-positive-universities-alliance-to-reverse-nature-loss; https://www.rgu.ac.uk/news/news-2024/7738-rgu-launch-vast-55-acre-biodiversity-project; https://www.brighton.ac.uk/news/2025/university-of-brighton-and-sussex-wildlife-trust-unite-to-protect-chalk-grassland; https://www.ed.ac.uk/news/2024/forest-peatland-net-zero-scheme; https://www.nottingham.ac.uk/sustainability/grounds/wilding-campuses-project.aspx; https://www.reading.ac.uk/estates/-/media/project/functions/estates/grounds/documents/habitat-management-plan_current–_01_2024.pdf; https://www.sheffield.ac.uk/sustainability/news/university-sheffield-boosts-campus-sustainability-biodiversity-hotspots; https://news.st-andrews.ac.uk/archive/university-develops-wildflower-meadows/; https://www.staffs.ac.uk/about/facilities/campus-transformations/river-trent-restoration; https://www.uos.ac.uk/about/our-vision/sustainability/our-campus/.
