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Background Land use land cover (LULC) transformation and ecosystems service valuation (ESVs) play important roles for vegetation restoration and design restoration options such as payment for ecosystems service programs. The objective of this work was to quantify LULC transformations and associated ESVs in the Gojeb sub-basin by analyzing LULC between 1986 and 2016 using satellite images, field observations and ancillary datasets. And Ecosystems service valuations of different land use types were carried out using benefit transfer method. Results The summarized LULC classes are: bareland, cropland, grassland, forest, plantation, settlement, shrub, water-body and woodland. The ESVs were evaluated for each LULC based on these LULC classes. Forests had the highest cover (> 423,000 ha ~ 60%) in 1986 but it reduced to 317,000 ha (~ 45%) in 2016. About > 56,000 ha of forests were changed to cultivated land, and > 105,000 ha to different classes. Cultivated land increased to > 258,000 ha (~ 37%) in 2016 compared to 150,000 ha (~ 21.5%) in 1986. The sub-basin had ESVs of US$2.52 billion in 1986 but decreased to US$ 1.97 billion in 2016; losing about US$ 0.551 billion within the last 30 years (annual loss rate of US$ 18.4 million). Potential drivers would be agricultural expansion, land degradation/erosion, landslide and deforestation, indicating that requires concerted effort to restore and manage landscapes for sustainable socio-ecological and economic uses. Conclusion This study is meaningful for management of natural resources in the catchment, improvement of hydropower production and lifespan of the hydropower reservoir besides to improving land productivity for small holder farmers as hydrological cycles and biodiversity components of the catchment can be improved. This study assist policy makers in designing evidence-based programs such as payment for ecosystem services in the study area and elsewhere.

Evaluating ecosystems services values due to land use transformation in the Gojeb watershed, Southwest Ethiopia