The SEEA Ecosystem Accounting standard, finalised in 2021, is an internationally agreed framework designed to do for ecosystems what the System of National Accounts does for the economy: measure, value and report them in a consistent, comparable way. The motivation is simple but profound. Ecosystem contributions to people, from seafood to storm protection, are rarely measured or reported in ways directly comparable with the costs of restoration or the returns from alternative land uses. This creates a persistent decision-making problem: restoration may deliver enormous public benefits, but those benefits remain invisible in the financial and accounting systems used to guide investment. By providing a common language for describing ecosystem contributions, SEEA EA allows decision-makers to weigh natural capital alongside human-produced capital, making the case for restoration legible to treasuries, not just ecologists.

The research team, led by Paul E. Carnell of Deakin University and colleagues from The Nature Conservancy, Deakin University, RMIT University and Monash University, applied this framework to Port Phillip and Western Port, two semi-enclosed bays in Victoria, south-eastern Australia. Together, these bays comprise 25 per cent of the marine areas under the jurisdiction of the State of Victoria. The team focused on three internationally recognised coastal ecosystems: mangroves, tidal marshes and seagrass meadows. These were selected because they have documented histories of loss or degradation, are relevant to current restoration policy, and have sufficient regional data to support accounting of extent, condition and selected ecosystem service flows. Victoria’s mangroves, comprising a single species, Avicennia marina subsp. australasica, occur at the highest latitude anywhere in the world, reaching a maximum height of just 3.9 metres compared to 13 metres in more tropical climates.

The accounting exercise began with a sobering baseline. Since European colonisation around 1750, Port Phillip and Western Port have lost an estimated 194 hectares of mangroves, roughly 10 per cent of their historical extent, and 2,753 hectares of tidal marshes, some 34 per cent. Seagrass meadows have fared worse still: only 7,031 hectares, or 15 per cent of the meadows mapped since the 1960s, have remained stable and classified as Low-Natural condition. Conversely, 27,080 hectares, or 58 per cent, have collapsed over the same period. The team assessed ecosystem condition using principles from the IUCN Red List of Ecosystems, the global standard for assessing the risk of ecosystem collapse. Because direct field-based condition data were unavailable across the full spatial extent of the two bays, they used a threat-based approach, identifying altered hydrology through artificial levees and livestock grazing as the key drivers of degradation. Sites were classified as collapsed if they were historically mangrove or tidal marsh but are currently another ecosystem type.

The current ecosystem service accounts reveal the scale of what has been lost and what remains. The combined physical and monetary value of the assessed subset of services from tidal marsh, mangrove and seagrass ecosystems in the two bays was AUD 89.7 million per year. This figure is deliberately conservative: it excludes broader recreation, amenity, education, research, cultural, spiritual, species appreciation and biodiversity-related values, because regionally relevant data for those services were not available. The assessed services included one provisioning service (commercial fisheries), one cultural service (recreational fishing), and three regulating services (carbon sequestration, nitrogen sequestration and coastal protection). Nitrogen sequestration had the highest monetary value of all services, at AUD 46.8 million per year combined, reflecting the efficiency with which coastal wetlands process and store nitrogen, a pollutant that can contribute to harmful algal blooms. Recreational fishing, valued using a spatially explicit travel-cost and site-choice model, contributed AUD 33.1 million per year, with an estimated 2.2 million fishing trips per year to areas with seagrass.

The valuation methods are technically rigorous and deliberately varied. Carbon sequestration was valued using the Australian Carbon Credit Unit price of AUD 13.87, calculated as the average observed price over 2018-2020 and treated as a conservative market-price proxy. Nitrogen sequestration was valued using an avoided-cost or shadow-price estimate of AUD 56 per kilogram, converted from a European literature review. Coastal protection was modelled using the InVEST coastal protection toolbox, estimating the number of people and value of property protected from a one-in-ten-year coastal inundation event. Commercial fisheries were valued using stable isotope analysis to estimate the proportion of fish diet originating from coastal ecosystems, combined with catch data and market prices. The team notes that these monetary values are not all SEEA exchange values: recreational fishing uses a welfare value, carbon uses a market-price proxy, nitrogen uses a shadow price, and coastal protection uses an avoided-damage value. This transparency is essential for interpreting the results as decision-support estimates rather than precise market valuations.

With the current accounts established, the team turned to the prospective question: what would it cost to restore what has been lost, and what would the returns be? They identified 114 feasible restoration locations covering 1,689 hectares, a subset of the total historical loss where current land use, mapped threats and feasible management actions allowed a plausible restoration scenario to be defined. Two restoration activities were considered, applied alone or together: fencing to remove grazing and trampling pressure, and levee removal to reinstate tidal exchange. Fencing was treated as a lower-cost intervention that allows vegetation recovery once grazing pressure is removed. Levee removal was treated as a hydrological restoration intervention that can reinstate tidal flow and allow wetland processes to recover. Seagrass restoration was not considered because restoration methods in the region are still being developed and the causes of seagrass decline have not been fully resolved.

The scenario analysis produced a clear hierarchy of investment returns. Levee removal alone provided the highest net benefit, with values ranging from AUD 0.025 million to AUD 33.5 million per site, and the highest-value sites concentrated along the western shoreline of Port Phillip Bay, in areas predominantly used as sewage treatment ponds or abandoned salt production ponds awaiting restoration. Fencing, while cheaper per site, was available only for smaller patches, meaning net benefits generally ranged from AUD 0.011 million to AUD 3.3 million per site. Sites requiring both fencing and levee removal carried higher costs but still returned substantial net benefits, up to AUD 8.2 million per site in Western Port. The spatial variation in net benefit was driven largely by site geometry: restoration costs increased with site perimeter, while benefits increased with the area restored, favouring larger sites with low perimeter-to-area ratios. This information can support government and non-government organisations in allocating restoration investment more efficiently, and is timely during the UN Decade on Ecosystem Restoration.

The study’s contribution is not a complete ocean account or a total economic valuation of all ecosystem services in Port Phillip and Western Port. Instead, it is a practical demonstration of how available ecological, spatial and economic information can be organised within the SEEA EA framework to support investment decisions. The analysis excludes opportunity costs, assumes restoration responses based on available ecological knowledge, and does not model future changes in population, climate, sea level, or carbon and nitrogen prices. Because opportunity costs are omitted, reported net benefits and benefit-cost ratios may be biased upward where restoration displaces productive agriculture, infrastructure or other valuable land uses, though this bias should be smaller at sites with low-value or abandoned existing uses. Sensitivity analysis across discount rates from 1 to 11 per cent and time horizons of 20, 50 and 100 years confirms the robustness of the overall conclusion: the benefits of restoring these coastal wetlands substantially outweigh the costs.

As investment in ecosystem restoration and natural capital increases globally, systems that enable the consistent assessment of investment decisions across time and space, both at local and national levels, can contribute to more efficient, effective and transparent decision-making. National initiatives such as Australia’s National Ecosystem Accounts demonstrate how this approach is increasingly being operationalised at scale. The expanding international implementation of SEEA EA provides further impetus for monitoring and data-collection programs that align with the framework. For coastal managers seeking to understand what decisions they can make today to rectify some of the historical losses, the message is clear: the accounting framework exists, the data are sufficient, and the returns are compelling. What remains is the political will to treat coastal restoration not as a cost, but as an investment in an asset class that has been quietly generating wealth for millennia.

Subject of Research: Ecosystem accounting framework applied to coastal wetland restoration investment decisions

Article Title: Ecosystem accounting to support coastal restoration decision-making

Article References: Carnell, P. E., McLeod, R., Young, M. A., Gillies, C. L., Obst, C., Macreadie, P. I., Ierodiaconou, D., Reeves, S. E., Eigenraam, M., Jänes, H., Kelvin, J., & Nicholson, E. (2026). Ecosystem accounting to support coastal restoration decision-making. Environmental and Sustainability Indicators, 32, Article 101550. https://doi.org/10.1016/j.indic.2026.101550

Image Credits: AI Generated

DOI: Not provided

Keywords: ecosystem accounting, SEEA EA, coastal restoration, mangroves, tidal marshes, seagrass, blue carbon, natural capital, Port Phillip Bay, Western Port, ecosystem services, restoration economics