Fund to boost private sector investment in nature opens for second round

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Organizations looking for investments in nature projects to combat climate change, create and restore habitats or improve water quality are invited to apply for the second and final cycle of the Preparedness Fund. investment in the natural environment.

The fund of up to £ 10million will provide grants of up to £ 100,000 to environmental groups, local authorities, businesses and other organizations to help them develop nature projects in England to a point where they can attract private investment.

The funding will be invested in a wide range of projects that will deliver environmental benefits while also demonstrating a wide range of innovative approaches to generate income from the wide range of benefits that nature offers.

Projects will be designed to provide a return on investment by capturing the carbon value, water quality, biodiversity and other benefits provided by natural assets such as forests, peatlands, watersheds and landscapes. .

This will create a pipeline of projects in which the private sector will invest, demonstrating the UK’s leadership and action in increasing finance for nature and climate during COP26. The opening of the bid window comes after the Chancellor outlined plans for the UK to become the world’s first net zero aligned financial center, welcoming pledges from private companies spanning $ 130 trillion from financial assets that will create a huge pool of liquidity that could fund our net zero transition.

Environment Minister Lord Benyon said:

As nations come together at COP26 to make important commitments to protect and enhance our natural environment, it is essential that we stimulate greater private sector investment, alongside continued public sector funding, if we are to cope with this. success in climate and biodiversity crises.

The fund has already supported 29 projects aimed at creating new forests and wetlands and restoring peatlands, with the second round of funding providing more opportunities for organizations to gain support to attract private sector investment into their projects.

Emma Howard Boyd, President of the Environment Agency and Interim President of the Green Finance Institute, said:

Climate and natural emergencies are intertwined, protecting and enhancing the national natural environment will help protect investments from climate disruption and generate long-term stable returns.

The Natural Environment Investment Readiness Fund is already showing how different income models drive investment. We need big investors to recreate them at a much larger pace and scale. COP26 focused its attention on preparing for climate shocks using nature-based solutions. Along with public sector investments, the private sector must be encouraged and supported to find the opportunity to protect nature and manage climate change.

Among the 29 programs benefiting from the first round of funding are projects to restore kelp forests, create new forests, natural flood risk management and improve water quality. They understand:

  • Crystal Clear Clyst Bond, an East Devon District Council program seeking to convert agricultural land to woodland in an area experiencing growth in development, through an environmental impact bond;
  • Swinton Estate in North Yorkshire, working to develop a new business model for multifunctional forestry to reap broader benefits from carbon sequestration, biodiversity credits, recreation and water quality
  • Lancashire Wildlife Trust’s program to increase investment to restore peatlands through the Greater Manchester Environment Fund by modeling income from the sale of carbon and biodiversity credits through the creation of forests and increased biodiversity; and
  • The Surrey Wildlife Trust’s project to create a natural capital investment company to model large-scale net biodiversity gain to support development growth in the south of England.

The Fund was designed by Defra and the Environment Agency, in collaboration with HMT, Natural England and Access – Foundation for Social Investment.

Tony Juniper, President of Natural England, said:

It is essential that we find ways to attract more investment in nature recovery. This is why I am so happy that the Natural Environment Investment Readiness Fund has once again opened its doors to tenders. This is a vital area of ​​innovation and there were some great offers in the first round showing the potential to scale up in favor of green recovery.

Developing investment-ready projects will be a critical part of how we deliver the ambitious Nature Salvage Network that is at the heart of Natural England and government plans. Interest in joining and developing these new markets is increasing all the time and I am proud that Natural England is playing an important role in providing technical expertise.

The Green Finance Institute (GFI) supported Defra and the Environment Agency throughout the first round of the Fund and will continue to promote the knowledge acquired in the financial sector, in partnership with Ecosystems Knowledge Network and the Esmée Fairbairn Foundation. .

Dr Rhian-Mari Thomas OBE, Managing Director of the Green Finance Institute, said:

As pointed out in our recent report, England alone faces a £ 21-53 billion funding gap over the next decade to meet key nature goals. The Fund plays an important role in bridging this gap through its development of a potential pipeline to attract private investment in nature, and through the shared learning provided by the Fund’s community of practice.

We look forward to seeing innovative projects under this second round of funding.

The fund – which will be open for nominations until February 3 – will help honor commitments made in the government’s 25-year environmental plan and green finance strategy, as well as support the Prime Minister’s 10-point plan to a green industrial revolution and the Net Zero strategy. .

More information

• The Environment Agency maintains a NEIRF SharePoint website where additional support will be announced during the application window. Access can be provided by sending an email to [email protected]


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