This project is the first to use a new green investment financial model, which will see multiple beneficiary organisations repay the upfront investment through the sale of ecosystem services. It is also the first environmental project eligible for Social Investment Tax Relief (SITR).
The launch of the project today was attended by Emma Howard Boyd, Chair of the Environment Agencyand included a visit to the Upper Wyre Catchment, adjacent to one of the sites set to receive funding to deliver nature improvements. The visit was timed to mark the announcement of the second round of projects to benefit from the pioneering Natural Environment Investment Readiness Fund, for which the Wyre project has acted as a pilot.
Emma Howard Boyd, Chair of the Environment Agency and interim Chair of the Green Finance Institute, said: “The Wyre Rivers Trust and this project, with support from Triodos Bank UK and the Esmée Fairbairn Foundation, has been a trailblazer in securing private investment for nature-based solutions to tackle the impacts of climate change. The landowners should also be recognised for their pioneering approach in embracing a new way of working and using nature capital.
“This project and the Natural Environment Investment Readiness Fund is leading the way in showing how private investment in nature can be achieved, including by providing long-term returns through costs avoided from a reduction in flood risk, such as here where communities will benefit downstream in Churchtown, which were impacted during Storm Desmond.”
Bevis Watts, Chief Executive of Triodos Bank UK, said: “We have been delighted by investor interest and support during the capital raising process. Close partnerships with all involved has been key and an aligned vision has shown that success is possible in an initiative of this kind. We hope this work will inspire others in the finance sector to play a role in connecting economic outcomes to investment in environmental restoration. It has taken approximately two years to bring this investment to fruition and more support is needed to develop similar projects nationwide to address climate change, adapt to its effects and restore biodiversity. This is going to be critical to meeting net zero goals and reversing nature’s decline.”
The money raised in the project will be used to deliver over 1,000 highly targeted Natural Flood Management measures over nine years:
- Wetland creation - temporarily storing water: this could include leaky dams, earth bunds, bunded hedgerows, peatland restoration, floodplain reconnection etc.
- Grassland creation - increasing catchment roughness to help slow overland flow. This could include land use change (intensive grassland to rough pasture), riparian buffer strips etc.
- Woodland Creation - to intercept and transpire water. This could include large native woodland blocks or riparian tree planting.
Farmers and landowners in the local area will receive grants to host and maintain these nature interventions. The measures are designed to reduce the maximum water volume of a flood (peak flood level) and/or delay the arrival of the flood peak downstream by emulating or restoring the natural functions of a river catchment. As well as protecting homes and businesses downstream, such NFM interventions can boost biodiversity, increase resilience to climate change and improve water quality.
Mark Lloyd, CEO of The Rivers Trust, said: “I’m extremely proud to see this innovative project come to fruition. Nature-based solutions are a vital part of our collective arsenal to restore our natural environment and increase climate resilience, and I’m delighted that The Rivers Trust is leading the way, working in cross-sector partnerships to find sustainable funding models to implement them at scale.”
Thomas Myerscough, General Manager of the Wyre Rivers Trust, said: “We are thrilled to be at the forefront of the delivery of nature-based solutions using private investment. The mobilisation of funding for the delivery of natural flood management measures as part of this project will confer a wide variety of benefits to the communities and habitats of the Wyre Catchment. The engagement of local farming communities has been critical to the success of this project and we are delighted to be working in partnership with them.”
Jo Harrison, Environment, Planning and Innovation Director at United Utilities, said: “We’re very proud to support the Wyre Natural Flood Management project. This project provides a unique mechanism to secure funding on a scale that wouldn’t be possible for individual organisations on their own. United Utilities has been involved in this project since its inception and we hope that it becomes a blueprint for many others in the region and nationally. By working in partnership in this way, we can deliver real tangible results that will bring benefits to communities and the environment.”
Notes to editors
Background to the project
The Wyre NFM project was initiated by United Utilities, Environment Agency, and The Rivers Trust in 2019 with the aim of developing a new commercial business model to accelerate landscape and nature recovery which can attract private financing and innovative contracting structures to supplement public funding and address flood risk. It has been led by the Wyre Rivers Trust, The Rivers Trust national, and Triodos Bank UK. Other partners include Markerstudy, United Utilities, Flood Re, Co-op Insurance, Wyre Council, Northwest Regional Flood and Coastal Committee, Woodland Trust with Hogan Lovells providing pro bono legal advice.
It is one of four pilot “nature-based investment” projects across England which have received development grant funding from Esmée Fairbairn Foundation in partnership with Defra and Environment Agency. The aim of these projects is to look at how to attract private finance to help tackle climate change, protect, and restore nature, and deliver environmental benefits.
Natural Course is a 10 year LIFE IP project with the objective of designing projects to better understand and overcome some of the biggest barriers preventing the achievement of ‘good ecological status’ under the EU Water Framework Directive in the North West River Basin District. Natural Course is a collaborative project between The Environment Agency, Greater Manchester Combined Authority, Natural England, the Rivers Trust and United Utilities
Natural Environment Investment Readiness Fund
The Wyre NFM project has acted as a pilot project for the £10 million Natural Environment Investment Readiness Fund, which provides grants of up to £100,000 to environmental groups, local authorities, businesses and other organisations to help them develop nature projects in England to a point where they can attract private investment.
Investment will be achieved by capturing the value of carbon, water quality, biodiversity and other benefits provided by natural assets such as woodlands, peatlands, and rivers – with revenue generated through the sale of carbon and biodiversity units, natural flood management benefits and reduced water treatment costs.
More than 50 projects have received grants in the second and final round, it has been announced today.
Further information about the Natural Environment Investment Readiness Fund:
The Natural Environment Investment Readiness Fund is helping to support the development of projects that can demonstrate a return on investment by capturing the value of carbon, water quality, biodiversity and other benefits provided by natural assets such as woodlands, peatlands, and rivers.
Examples of projects receiving funding in round two include:
- Rewetting lowland peat in Doncaster to grow plant fibre material to use as padding for clothes. The project will attract investors by showing how revenue can be generated from the sale of biodiversity and carbon units, as a means of compensating for biodiversity loss and carbon emissions, as well as through the creation of sustainable textiles
- Habitat enhancement, such as tree planting, brownfield land regeneration and nature recovery, to address ecological and environmental degradation in the Liverpool City Region with revenue generated through selling biodiversity units to housing developers that need to compensate and provide a net gain for any biodiversity loss resulting from the development.
- Exploring the potential for new natural surface water drainage schemes in Plymouth to unlock development by reducing flood risk, improving water management and climate resilience, aiming to attract investment from beneficiaries such as water companies and developers.
- Developing a pilot Seagrass Carbon Code to attract investment in seagrass beds as a carbon sink and biodiversity-rich habitat, to facilitate agreements for the sale of seagrass carbon units
- Transforming the Great Fen in Cambridgeshire by restoring peatlands and generating carbon income through the Peatland Code – used to assess the amount of carbon stored by different activities.