Towards project portfolios

While the pipeline of nature finance projects in the UK remains in its infancy, it is emerging as an important aspect of green (and blue) enterprise and entrepreneurial endeavour. The current mix of projects is disparate. It is being delivered by entities ranging from large private estates to local government organisations and small community groups. The pipeline includes representation of most major rural habitats in the UK, ranging from upland peatland to lowland farm hedgerows and marine habitat. The trading is, however, currently dominated by projects in rural settings in England, which is where most of the revenue generation is occurring.

This Review has found evidence that ‘investment readiness’ funding is increasing the chances of local projects being able to attract revenue. Nonetheless, the review presents specific barriers to smaller projects and tenants to participating in environmental markets (see results and discussion). More detail on specific barriers and how they can be overcome is found in Appendix 5 – ‘Supplementary observations and recommendations’. There is a need to ensure that smaller land managers can formulate projects within their resource constraints and without radical disruption of their existing business. These smaller land managers include community-based groups, owner-occupier farmers, tenant farmers and crofters. They need access to efficient ways of finding suitable buyers for the ecosystem service credits that they can offer, as well as advice on pricing, when to sell and what to do about the pressures on their own businesses to reach net zero and be nature positive. Rather than simply providing ‘investment readiness’ funding, it will be important to ensure that those trusted by land managers to advise them are equipped to provide insight on nature finance.