More financing for natural capital projects
Biodiversity and ecosystems are not typical targets for investors and bankers. The Natural Capital Financing Facility wants to change this by putting finance in the service of nature, as a resource worthy of long-term investment rather than an asset to be stripped.
Launched by the European Investment Bank (EIB) and European Commission, the Natural Capital Financing Facility (NCFF) aims to boost funding for biodiversity and environmental protection by mobilising public- and private-sector finance to encourage investment in ecosystems.
“To protect the diversity of our natural surroundings we need to promote the diversity of our funding sources. The Natural Capital Financing Facility is a new EU funding instrument that can help businesses protect nature and adapt to climate change, turning biodiversity into an engine for growth,” said Karmenu Vella, European Commissioner for Environment, Maritime Affairs and Fisheries, launching the fund.
The €125-million NCFF works like a bank facility for the environment. It provides loans to “bankable projects” and investments that show how natural capital can generate revenue or save costs whilst meeting the EU’s biodiversity and climate action goals.
Green roofs or ecosystem-based flood protection are examples of ‘green infrastructure' projects that are eligible for NCFF support. So, too, are ecosystem-based projects related to ecotourism, forestry programmes and aquaculture businesses that promote biodiversity, or help adaptation to climate change.
(Biodiversity) business proposition
The bottom line, according to the European Commission's LIFE programme – which is contributing €50 million as a guarantee and €10 million for capacity building – is that recipients should showcase successful ways of protecting biodiversity or ecosystems and the return on investing in such projects.
The Facility is expected to back up to 12 projects during a pilot phase until 2017 – each receiving €5-15 million. The NCFF will finance up to 75 % of the total project cost. Anyone can propose a project to the EIB, the aim being to ensure a good geographical and thematic spread over the implementation period.
In addition to an innovative business model that delivers on biodiversity and ecosystem goals with bankable and replicable results, successful projects must meet the EIB’s standard investment criteria and show their value added to the LIFE programme for nature and biodiversity or climate adaptation.
So… do you have a biodiversity business proposition to pitch?