Natural Environment Investment Readiness Fund

Round Overview

In Round 1, 29 applicants were awarded grants including:

• United Utilities’ development of an environmental impact bond model and an investment case to deliver up to ten sustainable drainage systems to industrial estates and other nature based solutions;
• Ecotricity’s establishment of a carbon bank – identifying and modelling woodland creation in a number of company sites, which will result in the creation and selling of woodland carbon a new and bespoke web platform to over 200,000 customers;
• Swinton Estate in North Yorkshire, working to develop a new business model for multi-functional forestry to realise wider benefits from carbon sequestration, biodiversity credits, recreation, and water quality;
• Lancashire Wildlife Trust’s scheme to raise investment to restore peatland through the Greater Manchester Environment Fund by modelling revenues from the sale of carbon and biodiversity credits through woodland creation and increasing biodiversity; and
• Surrey Wildlife Trust’s scheme to establish a natural capital investment company to model biodiversity net gain at scale in support of development growth in the southern England.

In Round 2, 57 schemes were awarded grants including:

• SaltyCo’s development of a blended agri-carbon model for lowland peat restoration, rewetting lowland peat to grow plant fibre material and sell the resulting carbon credits.
• Plymouth City Council’s pilot Seagrass Carbon Code, attracting investment in seagrass beds as a biodiversity-rich carbon storing habitat. Sediment sampling will be carried out to map the carbon sequestration potential.
• National Trust’s development of a ‘Nature Friendly Farming Transition Fund’, writing a business case to transition the National Trust’s tenant farmers towards more nature-friendly farming by generating revenue from carbon and Biodiversity Net Gain payments.
• Hill, Stone and Wood’s concept of a home insurance product that directs profit towards projects that will reduce local flood risk. The project also aims to create an Impact Monitoring Tool that will spread the approach through the insurance industry.
• Heal Rewilding CIO’s new blueprint for investing in rewilding sites. The project will develop a business case, an investment prospectus and secure buyers for the resulting Biodiversity Net Gain and carbon credits.
• Lancashire County Council’s Climate Resilience Insetting Mechanism, creating an alternative approach to carbon accounting using Authority-Based Insetting (ABI).

In Round 3 – aimed specifically at farmer-focused outcomes – 50 further projects were awarded grants, including:

• The North East Cotswold Farmer Cluster CIC and its work with Network Rail, Thames Water, and Great Yellow, A to develop and test a market model for farm revenues from nature based solutions protecting utilities and infrastructure from water related risks.  It is exploring the potential for farm-level solutions to replace hard engineering approaches.
• The Blackwater Environmental Investment for Conservation (BEIC) and its development of investment propositions for developers and businesses focusing on Biodiversity Net Gain (BNG), blue carbon, and water quality improvements on a 150ha coastal farm in the Blackwater Estuary.
• Plantlife International’s work to develop a grassland creation toolkit for smaller farmers. This will support the transition to regenerative grassland management using market opportunities from carbon, biodiversity and water management, including insetting.
• Finance Earth’s work to develop an endowment mechanism to de-risk Biodiversity Net Gain habitat long-term liabilities. Finance Earth is working with South Downs National Park Authority, Howden Group  and National Forest Company to address lack of project finance for habitat banking models.
• Gloucestershire’s Nature Project Portfolio Investment Model – working with Landscape Enterprise Network and The Land App to create a methodology for high-integrity, county-wide nature projects.  The project is developing options to sell investment opportunities to non-credit based nature markets, building on existing markets facilitated by the Integrated Local Delivery model.
• The Westcountry River Bank  – led by the Westcountry Rivers Trust – to create watercourse BNG units across Devon and Cornwall centred on weir removals.

Case Studies

As part of its evaluation and to support knowledge sharing from the NEIRF, a series of short case studies have been produced on completed projects. These projects have explored various revenue models based on ecosystem services such as carbon, Biodiversity Net Gain, and natural flood management. Each case study gives an overview of the project’s governance, revenue models, replicability, and key learnings. Further case studies will be published as projects complete.

Farming and Wildlife Advisory Group South West

The Carbon Bank

Hedgerow Carbon Code

The Investment Readiness Toolkit

The Green Finance Institute is working with NEIRF grantees and other projects to develop an Investment Readiness Toolkit for nature, based on the following Steps to Investment Readiness, which launched on 8 December 2022. It has over 30 detailed case studies about the NEIRF projects and their various stages of devleopment.