Stimulating demand for nature-related projects is a key part of a programme for making English nature projects more investable, a financial advisory company has said.

Finance Earth announced last September it would deliver a government-backed UK Nature Accelerator programme to incubate biodiversity net gain (BNG), woodland, and peatland projects in preparation for investment from the blended finance UK Nature Impact Fund.

Demand is a “critical part” of making projects investable, said Alicia Gibson, director at Finance Earth during a webinar on Wednesday.

Finance Earth is focused on what buyer engagement should look like, and what needs to be in place to stimulate demand, as part of the Nature Accelerator, Gibson said.

“It’s definitely a key part of the overall programme, recognising there’s that gap and difficulty around engaging with the market, and often the need for multiple projects in different areas at a broader scale.”

The advisory company is also engaging with the demand side via the UK Nature Impact Fund, on areas such as aggregating projects to make them more investable, she said.

Each cohort of the Nature Accelerator will see four to six organisations share experiences on their nature projects via workshops over periods of up to eight months.

Following the launch of the first cohort, the advisor has opened applications for the second round until Aug. 19.

SURREY SITES

Surrey Wildlife Trust, part of the first cohort, is working to attract investment to scale three BNG sites in the Guildford area at speed, said Zoe Channon, its director of business development and partnerships.

“These projects aren’t small, the investments aren’t small, and demand stimulation is absolutely critical from this,” said Channon.

“It’s something that needs to be done with integrated organisations, rather than just singularly, so that was a key driver for our participation.”

The trust took part in the scheme as it lowers risk while opening access to advisory experts, she said.

Film company Shepparton Studios paid £1 million to secure a Surrey Wildlife Trust off-site BNG meadow, separate from its accelerator areas, last year.

FUNDRAISING MAKING PROGRESS

The UK Nature Impact Fund launched in July with £30 mln from the government, marking the first nature-based solutions blended finance fund in the country targeting institutional scale.

The fund initially aimed to close by the end of 2024, but it is still fundraising.

Cameron Hughes, senior land use policy advisor at the Country Land and Business Association, asked whether investors thought they could get returns from the fund.

Gibson said the fund team has been working with institutional investors to fundraise by helping them understand nature markets, while adjusting the strategy based on feedback.

“We have shifted over time – now focusing on very specific nature markets, and we do recognise it’s taken a lot more time than anticipated. We are continuing to push.”

“We haven’t raised secure funds yet, but that’s basically the key focus of the fund – before we were doing quite a lot of engagement with the market. It’s challenging, but we’re making good progress.”

By Thomas Cox – t.cox@carbon-pulse.com

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