Nov 17, 2025
Protocol: Municipal-Scale Natural-Capital Accounting for Local Governance in Albania
- Dr. Kledian Kodra1,
- Dr.Elton Qendro2,
- Prof.Asoc. Ledian Shahini3,
- Dr. Arbi Shehu4,
- Prof.Asoc.Mihallaq Qirjo5
- 1Doctor of Economic Sciences Faculty of Economics University of Tirana;
- 2Doctor of Security Sciences from Defense Academy of Albania;
- 3Doctor of Economic Sciences, Faculty of Economics, University of Tirana;
- 4Doctor of Sciences, Faculty of Geology, University of Tirana;
- 5Prof.Asoc of Natural Sciences Faculty, University of Tirana
- Tirana,Albania
External link: https://www.osce.org/sq/presence-in-albania/568930
Protocol Citation: Dr. Kledian Kodra, Dr.Elton Qendro, Prof.Asoc. Ledian Shahini, Dr. Arbi Shehu, Prof.Asoc.Mihallaq Qirjo 2025. Protocol: Municipal-Scale Natural-Capital Accounting for Local Governance in Albania. protocols.io https://dx.doi.org/10.17504/protocols.io.kqdg31oypl25/v1
License: This is an open access protocol distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited
Protocol status: Working
We use this protocol and it's working
Created: November 14, 2025
Last Modified: November 17, 2025
Protocol Integer ID: 232468
Keywords: Natural capital, Municipal-level accounting, Environmental governance, albania natural capital accounting, creation of the municipal natural capital asset register, municipal natural capital asset register, capital accounting for local governance, local governance integration, nca in local government system, municipal administrative information, municipal administrative information into seea, local governance, local government system, municipality, osce presence in albania, albania, environmental governance, quantification of annual physical ecosystem, ecosystem, annual physical ecosystem, economic contributions of ecosystem, monetary valuation, implementing nca, monetary valuation of flow, capital accounting, valuation technique, guidance on institutional setup, ministry of interior, institutional setup, term local planning, legal integration, legal integration in the decentralization strategy, energy extraction data,
Abstract
Natural capital accounting (NCA) provides a systematic approach to identify, quantify and value the biophysical and economic contributions of ecosystems to human well-being. Although widely applied at national scales, methods for municipal-level NCA remain underdeveloped. Here we present a replicable protocol for implementing NCA in local government systems, based on the methodology adopted by Albania’s Ministry of Interior and the OSCE Presence in Albania (2021). The protocol consists of three sequential phases: (1) creation of the municipal Natural Capital Asset Register, (2) quantification of annual physical ecosystem-service flows, and (3) monetary valuation of flows and asset stocks. The protocol integrates spatial datasets, hydrological and geological records, agricultural and forestry statistics, mineral and energy extraction data, and municipal administrative information into SEEA-EA–aligned accounts. It includes guidance on institutional setup, data harmonization, ecosystem-service modelling, valuation techniques and local governance integration. This protocol has been piloted in four municipalities (Mat, Roskovec, Selenicë, Pogradec) and subsequently scaled to all 61 municipalities through a national training curriculum and legal integration in the Decentralization Strategy 2023–2030. The workflow enables municipalities to build coherent, evidence-based natural-capital accounts in 18–28 weeks and supports long-term local planning, budgeting, and environmental governance.
Materials
- Software
- GIS software (QGIS recommended)
- Spreadsheet software (Excel)
- Statistical or scripting software (R/Python optional)
- OSCE–MoI NCA data templates
- Documents
- Natural Capital Manual for Municipalities (OSCE 26 MB, 2021)
- Municipal asset registries
- MTBP and territorial plans
Troubleshooting
Overview of the protocol
Creation of the Municipal Natural Capital Asset Register: Identification of all biotic and abiotic natural assets (minerals, forests, water, energy resources, land, biodiversity).
Assessment of physical ecosystem-service flows: Annual quantification of provisioning (agriculture, timber, hydropower, oil, minerals), regulating (carbon, soil retention, water regulation), and cultural services.
Monetary valuation: Conversion of physical flows into Albanian Lek (ALL/year) through market-price, resource-rent, replacement-cost, and benefit-transfer methods.
Procedure
Phase 1 — Institutional Setup (1–2 weeks)
Appoint Working Group (environment, agriculture, forestry, water, tourism, finance).
Sign internal data-sharing order.
Identify NCA focal point.
Phase 2 — Create Asset Register (3–4 weeks)
Collect spatial layers (land cover, hydrology, forests, soils).
Populate asset inventory:
Mineral resources
Energy resources
Water resources
Land resources
Biodiversity 6 protected areas
Classify assets using SEEA-EA ecosystem-types + Manual typologies.
Produce asset maps and tables.
Phase 3 — Quantify Physical Flows (4–6 weeks)
Agricultural yield calculations.
Forest biomass estimation.
Water regulation 6 hydrology modelling.
Soil erosion (RUSLE).
Oil/mineral extraction volumes.
Tourism visitation 6 recreation metrics.
Compile annual physical flow tables.
Phase 4 — Monetary Valuation (3–5 weeks)
Market-price valuation (agriculture, tourism, timber).
Resource-rent valuation (oil, minerals, hydropower).
Replacement cost (water purification, erosion control).
Benefit transfer (biodiversity).
Convert all physical flows to ALL/year.
Compute asset values using present-value formula.
Phase 5 — Integration into Governance (4–8 weeks)
Present results to Working Group.
Integrate into MTBP and local plans.
Prepare council briefing.
Upload to national system (MoI–ASLSG).
Timing
Institutional setup: 1–2 weeks
Asset register: 3–4 weeks
Physical flows: 4–6 weeks
Valuation: 3–5 weeks
Governance integration: 4–8 weeks
Total: 18–28 weeks per municipality (8–12 weeks after scaling)
Troubleshooting
Missing data on water flows: Incomplete AMBU records. Solution: Use basin averages + municipal checks.
Agricultural data inconsistent: Multiple registries. Solution: Cross-verify with INSTAT + field-based expert opinion.
Mineral/oil data restricted: Operator confidentiality. Solution: Use AlbEITI or aggregated AKBN data.
GIS misalignment: Different projections. Solution: Reproject to EPSG:32634.
Anticipated Results
Complete municipal Natural Capital Asset Register
Physical flow accounts for all major ecosystem services
Monetary-flow accounts (ALL/year)
Long-term natural-capital asset valuation
Integration into budgeting and planning
Councils adopting NCA-based decisions
National NCA consolidation across 61 municipalities
Protocol references
- Kodra.K., et al (2024). Manual për Bashkitë – Vlerësimi i Kapitalit Natyror. OSCE, Tirana.
- Qëndro, E., Haxhimali, A., Shehu, A., & Kodra, K. (2022). Vlerësimi i Kapitalit Natyror – Bashkia Roskovec. OSCE Presence in Albania.
- Qëndro, E., Haxhimali, A., Shehu, A., & Kodra, K. (2022). Vlerësimi i Kapitalit Natyror – Bashkia Selenicë. OSCE Presence in Albania.
- Qëndro, E., Haxhimali, A., Shehu, A., & Kodra, K. (2022). Vlerësimi i Kapitalit Natyror – Bashkia Pogradec. OSCE Presence in Albania.
- Kodra, K., et al. (2021). Pilotimi i Metodologjisë për Vlerësimin e Kapitalit Natyror në Bashkinë Mat. OSCE Presence in Albania
Acknowledgements
DEVELOPMENT OF THE PROTOCOL
The protocol was developed through a national co-creation process involving:
- Ministry of Interior
- OSCE Presence in Albania
- ASLSG
- Municipal working groups
- National agencies (AKBN, AMBU, ASIG, NAPA)
- The piloting process across Mat, Roskovec, Selenicë, and Pogradec generated iterative refinements that now form the official national methodology.
APPLICATIONS
This protocol is suited for:
- Local governments (budgeting, territorial planning, reporting)
- National agencies (environment, energy, water, land, statistics)
- Researchers modelling ecosystem flows at subnational scale
- International donors implementing green-governance programmes
It can be extended to:
- Watershed-scale management
- Concession oversight for minerals, hydropower, hydrocarbons
- Climate adaptation funding proposals
- Environmental fiscal reforms
EXPERIMENTAL DESIGN
- Study type
- Observational, spatial–economic assessment combining GIS, administrative statistics, and valuation models.
- Sampling
- Full population (entire municipal territory).
- Data sources
- Spatial datasets (ASIG)
- Hydrology (AMBU)
- Energy resources (AKBN, ERE)
- Agricultural statistics (INSTAT, municipal directories)
- Mineral extraction records
- Biodiversity monitoring (NAPA, AKM)
EQUIPMENT
- Computer with e8 GB RAM
- GIS-capable processor
- GPS (optional for field verification)
PROCEDURE
Phase 1 — Institutional Setup (1–2 weeks)
- Appoint Working Group (environment, agriculture, forestry, water, tourism, finance).
- Sign internal data-sharing order.
- Identify NCA focal point.
Phase 2 — Create Asset Register (3–4 weeks)
- Collect spatial layers (land cover, hydrology, forests, soils).
- Populate asset inventory:
- Mineral resources
- Energy resources
- Water resources
- Land resources
- Biodiversity 6 protected areas
- Classify assets using SEEA-EA ecosystem-types + Manual typologies.
- Produce asset maps and tables.
Phase 3 — Quantify Physical Flows (4–6 weeks)
- Agricultural yield calculations.
- Forest biomass estimation.
- Water regulation 6 hydrology modelling.
Phase 4 — Monetary Valuation (3–5 weeks)
- Market-price valuation (agriculture, tourism, timber).
- Resource-rent valuation (oil, minerals, hydropower).
- Replacement cost (water purification, erosion control).
- Benefit transfer (biodiversity).
- Convert all physical flows to ALL/year.
- Compute asset values using present-value formula.
Phase 5 — Integration into Governance (4–8 weeks)
- Present results to Working Group.
- Integrate into MTBP and local plans.
- Prepare council briefing.
- Upload to national system (MoI–ASLSG).
TIMING
Phase | Duration
---|---
Institutional setup | 1–2 weeks
Asset register | 3–4 weeks
Physical flows | 4–6 weeks
Valuation | 3–5 weeks
Governance integration | 4–8 weeks
Total: 18–28 weeks per municipality (8–12 weeks after scaling)
TROUBLESHOOTING
Problem | Possible cause | Solution
---|---|---
Missing data on water flows | Incomplete AMBU records | Use basin averages + municipal checks
Agricultural data inconsistent | Multiple registries | Cross-verify with INSTAT + field-based expert opinion
Mineral/oil data restricted | Operator confidentiality | Use AlbEITI or aggregated AKBN data
GIS misalignment | Different projections | Reproject to EPSG:32634
ANTICIPATED RESULTS
- Complete municipal Natural Capital Asset Register
- Physical flow accounts for all major ecosystem services
- Monetary-flow accounts (ALL/year)
- Long-term natural-capital asset valuation
- Integration into budgeting and planning
- Councils adopting NCA-based decisions
- National NCA consolidation across 61 municipalities