The story has been updated with further details from Jeremy Eppel.

Two non-profit organisations and a Brazilian financial institution have joined forces with Rio de Janeiro municipality to develop an urban biodiversity credit programme and standard, while planning five other projects around the world, Carbon Pulse has learned.

The “first of its kind” initiative is led by UK-based Nature and People Foundation (NPF) and designed in partnership with the office of the mayor of the city, NatureFinance, and JGP Asset Management.

The group aims to raise $500,000 in seed funding over the next six months to finance the research on the most appropriate tree species to plant in several sites of the city, in a bid to deliver particular ecosystem services.

NPF is looking to pilot five more urban projects in Nairobi, London, Amsterdam, Seville, and Formentera. It aims to raise around half a million dollars for the Kenyan pilot, where additional work is needed to glean data, and slightly less for each European initiative.

In Rio, units will be issued by the municipality, though their price has not been decided yet. Each credit will represent biodiversity uplift in a 10-square-metre area – a much smaller geographical area than in forest-based initiatives due to the style of the project.

“It would not be like a large block of space that you would get with investing in a rural setting or a forest,” Jeremy Eppel, director of NPF and senior advisor at Nature Finance and at the Convention on Biological Diversity (CBD), told Carbon Pulse.

“We will have lots of disaggregated plots for tree planting, along the side of a motorway, a park, a street, or a river.”

Biodiversity improvements will be determined by measuring the diversity, abundance, and resilience of tree and shrub species.

The ecosystem service credits won’t be issued before 2029, but the rights to pre-purchase those credits could be available from 2025. Separate biodiversity credits could also be available to purchase within a year of tree planting.

“Project developers can generate urban biodiversity credits based on the increase of biodiversity and/or generate ecosystem service credits,” Eppel explained. “We won’t issue ecosystem service credits until there’s some evidence on the improvements achieved, likely to take around five years from the project launch.”

The initiative comes as Brazil prepares to host this year’s G20 meeting and the 2025 UN climate summit.

DENGUE FOCUS

Betting on biodiversity restoration could help Rio institutions and communities tackle major health and nature threats related to deforestation, such as dengue fever and heatwaves, Jose Pugas, head of responsible investment and engagement at JGP, told Carbon Pulse.

“The two main objectives of the initiative in Rio are to reduce the impact of the heatwaves and to create a proper environment for the natural predators of the Aedes Aegypti, the insect that acts as the main vector for dengue endemics in Rio,” Pugas said.

“It’s proven that if you plant the right species of trees that create habitats for natural predators, including lizards and birds, you will reduce the number of those disease-bearing insects,” Eppel added.

URBAN STANDARD AND METRICS

NPF is developing one of the first global standards for measuring urban biodiversity and ecosystem services to inform the project in Rio de Janeiro.

Based on the biometric model of plant species, it quantifies biodiversity and ecosystem services by taking into account their metabolic capacities and growth. The standard evaluates seven key factors:

• The leaf area
• Stomatas: tiny openings on the leaves
• Leaf physiognomy
• Canopy and its ability to attenuate ambient temperature and absorb harmful radiation
• The amount of food and shelter species provide
• Capacity to interact with humans
• Adaptation or resilience of the species

Remote sensing and advanced technologies will be used to monitor, report and verify biodiversity uplift.

“We intend to use satellite technologies, local monitors for diameter at breast height measurement, bioacoustics for pollinators and birds, and camera traps for mammals,” Eppel said.

A GROWING INTEREST

“What we’re trying to do now is to find cities around the world which are looking to turn these planting initiatives into credits for eventually monetising them,” Eppel said.

“So far, we have detected a lot of interest among private investors and corporations in the possibility of financing urban biodiversity in six cities.”

Along with the University of Seville, Spain, NPF has already studied 80% of European tree species to identify metabolic properties across a range of about eight different parameters.

Urban biodiversity is also among the eligible activities in the standard published by Colombian-based Cercarbono, whose final version was released in March.

The biodiversity credit market is slowly gaining traction, with proponents believing it could be a key means to fill the nature finance gap by mobilising private funding.

“These are a really valuable new source of finance for protecting and restoring nature and meeting the goals of the Global Biodiversity Framework, as long as they will be developed with high integrity,” Eppel concluded.

By Giada Ferraglioni – giada@carbon-pulse.com

*** Click here to sign up to our weekly biodiversity newsletter ***