Funding for infrastructure investment which comprises NBS financing is widely available (ESIF, Horizon 2020, EIB, LIFE, EEA & Norway Grants Fund, and other various instruments, e.g. commercial banks or EIB, e.g. NCFF). In relation to NBS funding the key issues seem to be an information deficit with regards to existing financing opportunities, potentially where there are higher investment costs or perceived higher financing costs.
Furthermore, there are obstacles and structural barriers that complicate the blending of public and private financing and loan financing and grants. There are also obstacles to accessing micro-financing and to integrating grants and other subsidies from various/different sources, or funds that target different themes or objectives. Addressing these barriers and challenges would improve the often much-needed funding for NBS in cities. A highly related (and intertwined with above mentioned) issue related to identifying the real investment costs of NBS where cities often lack the knowledge on how to assess the mid- to the long-term profitability of NBS.
The full potential of NBS implementation in cities cannot be achieved without raising awareness of and mainstreaming NBS funding options. In light of this, there is a need to increase visibility and understanding of the different sources of grant funding and loan financing available for projects integrating NBS, as well as to help cities to mitigate the burden of higher initial investment.
In accordance with identified issues and challenges, an action aimed at increasing the awareness of existing NBS funding sources is proposed. As a part of this action, it is necessary to address and tackle the challenges related to guiding urban stakeholders through the process of assessing the overall impact and mid- to long-term profitability and effects of NBS. These topics are highly intertwined, so it is necessary to focus on all of them in order to intensify the implementation of NBS in cities.
The result of this action will be a guide for those seeking financing for the implementation of NBS, such as representatives of cities and other local authorities, urban planners, investors etc. This will include information on funding options both from public and private sources (i.e. both grant and loan, equity/funds) for project implementation (financing, interest subsidy, guarantees and other credit-enhancement mechanisms), technical assistance (for project preparation, feasibility, design studies, monitoring etc.) and capacity and awareness building. A section of the guide will describe the financial mechanisms to mitigate higher initial investment costs of NBS versus grey infrastructure.
The guide will also include information on eligibility criteria and application procedures for different NBS funding sources, also considering the needs of cities with limited prior NBS experience, giving information on providers of technical and financial advice. The guide will also provide additional recommendations on how to remove barriers e.g. blending public and private financing and loan financing and grants. The guidance will be practical and implementation oriented. A part of the guide will also contain guidelines on approaches to identifying the overall and mid- to long-term effects of NBS compared to traditional grey solutions in cities. This will include guidelines for cities to systematically carry out a comprehensive CBA for any new urban investment. Knowing the real and overall impacts of NBS will, in turn, allow decision-makers to make investment decisions based on the true and long-term costs and returns.
- Sustainable Use of Land and Nature-Based Solutions Partnership full Draft Action Plan
- Draft Action 1: INCLUDING LAND TAKE IN IMPACT ASSESSMENT PROCEDURES
- Draft Action 2: FINANCING MODELS FOR BROWNFIELD DEVELOPMENT
- Draft Action 3: IDENTIFYING AND MANAGING UNDER-USED LAND
- Draft Action 4: INDICATORS OF LAND TAKE
- Draft Action 5: PROMOTING FUA COOPERATION AS A TOOL TO MITIGATE URBAN SPRAWL
- Draft Action 6: BETTER REGULATION TO BOOST NBS AT EUROPEAN, NATIONAL AND LOCAL LEVELS
- Draft Action 7.2: OVERCOMING THE BIAS FOR EXISTING SOLUTIONS THROUGH NBS FINANCIAL INCENTIVES MAINSTREAMING
- Draft Action 8: AWARENESS RAISING IN THE AREAS OF NBS AND SUSTAINABLE USE OF LAND (URBAN SPRAWL)
- Draft Action 9: AGREEING ON COMMON TARGETS AND INDICATORS FOR NATURE-BASED SOLUTIONS, URBAN GREEN STRUCTURE, BIODIVERSITY AND ECOSYSTEM SERVICES IN CITIES