Financing Nature-Based Solutions

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1 Financing Nature-Based Solutions for long-term water management Evelyn Underwood, 26 September 2018, CEEWeb annual conference Budapest

2 Financing nature-based solutions for longterm water management EU policies that promote ecosystem restoration EU funding in successes and barriers Innovative funding and private investment EU funding opportunities in 2021 to 2027

3 EU policies that promote ecosystem restoration: Birds and Habitats Directives Achieve and maintain favourable conservation status or secure populations (birds) Inside Natura 2000 sites outside Natura 2000 ecological connectivity, species protection State of Nature % of wetland habitats in unfavourable status, 28% reported as declining (mostly unknown trends) 73% of freshwater habitats in unfavourable status, 31% reported as declining Pressures agriculture and changes to hydrology

4 Restoration needs of Directives Study by BIO et al for Commission (2015) habitat group with largest proportional improvement needs is bogs, mires and fens Freshwater habitats improvement needs few MS with appropriate objectives set in PAFs - not measureable or quantitative Recommendations for new PAFs re targets

5 LIFE Nature funding Successes: Targeted Monitoring and evaluation Limitations: After LIFE National co-funding in some MS LIFE Strategic Nature Projects (integrated projects) New! Integration of cofunding opportunities in the EU funds (eg EAFRD)

6 Example: restoration of alvars in Estonia LIFE to Alvars

7 EU policies that promote ecosystem restoration: Water Framework Directive Good status target 2015 and 2021 Restoration of around 18% of degraded water bodies in 1st RBMP period Obstacles and pressures hydro-morphological pressures pollution (agriculture) over-abstraction How to control water abstraction How to define and ensure ecological flows

8 Example: Lower Saxony & Bremen joint integrated management plan for Weser ERDF: 3.7 million DE funds: 6.4 million

9 EU policies that promote ecosystem restoration: EU Biodiversity Strategy 2020 Target 2 (and global Aichi target): maintain and restore ecosystems and their services by including green infrastructure in spatial planning and restoring at least 15 % of degraded ecosystems by 2020 MAES Mapping and Assessment of Ecosystem Services MS restoration prioritization frameworks Green Infrastructure guidance What progress?

10 EU funding in successes and constraints Benefits of investment exceed costs Big funding gap EU funds 20% of funding needs EAFRD: net transfer Pillar I to Pillar II but some MS transferred the other way ERDF: allocated to other priorities but some good projects

11 Integration approach to EU biodiversity financing SUMMARY REPORT Integration approach Strengths EAFRD, some ERDF Weaknesses Lack of indicators Tracking of funds targeted to biodiversity Competing prioritiesmismatches, competition Constraints Administrative burden Institutional capacity Advice and information Social impacts and cooperative action Integration approach to EU biodiversity financing Evaluation of results and analysis of options for the future SUMMARY REPORT January 2017

12 Innovative financing Ecological Fiscal Transfers Portugal govt transfer to municipalities for PAs Tax relief France - Natura 2000 landowners Recreational user fees or charges Hunting & fishing fees in Estonia Salmon fishing in Ireland Marketed products Lesser Grey Shrike wine in France Riet Vell S.A. products in Spain

13 Riet Vell S.A. products Started as LIFE project for organic rice in Delta del Ebro Natura 2000 site Created company Riet Vell S.A. with capital from nature lovers Organic Durum wheat from Natura 2000 areas in Ebro valley Organic chickpeas and lentils from Natura 2000 site in Castilla La Mancha Market online and in organic food shops

14 Ireland Salmon fishing fees Angling licenses for salmon and wild trout Salmon Conservation Fund Pays for: stream restoration fish passage improvement protection of river banks riparian zone management Monitoring of salmon stocks

15 Natural Capital Financing Facility Loans & investments guaranteed by European Investment Bank Theme areas: Payments for Ecosystem Services Green Infrastructure Innovative pro-biodiversity and adaptation investments Biodiversity offsets Challenge for biodiversity projects of making business case

16 Evelyn Underwood, IEEP,

17 EU funding opportunities EAFRD & EAGF (CAP) ERDF / Interreg / CF / ESF EMFF LIFE Horizon Europe

18 Proposal for Common Agricultural Policy New! Single national CAP Strategic Plan for EAGF and EAFRD Assesses needs, defines priorities, defines funding opportunities Shift from compliance to performance Commission: how MS meet objectives & achieve targets New! Proposed MFF: EAFRD budget cut Cut by up to a quarter? Option to: Shift funds from Pillar II to Pillar I Shift funds from Pillar I to Pillar II

19 How do CAP objectives relate to Natura 2000 objectives? General objective: to bolster environmental care and climate action and to contribute to the environmental- and climate-related objectives of the Union Objectives of EU nature legislation Annex XI EU legislation - Habitats and Birds Directives Specific objective (f): contribute to the protection of biodiversity, enhance ecosystem services and preserve habitats and landscapes; CAP Strategic Plan must take account of Natura 2000 funding needs Biodiversity objective & target: must take into account assessment of needs in the PAF - especially sections E.2.4. Grasslands and E.2.5. Other agroecosystems (incl. croplands) New! combination of measures under both CAP Pillars

20 CAP opportunities for biodiversity and Natura 2000 EAFRD: environmental, climate & other management commitments (agri-env) Natura 2000 payments Investments New! integrated LIFE Strategic Nature Projects natural or other area-specific constraints Knowledge exchange, cooperation EAGF: New! Enhanced conditionality Ecoscheme - annual management measures on farmland Eligibility for direct payments permanent grassland defined in detail by Member States

21 How will the impact of the fund on Natura 2000 be monitored and evaluated? Results indicator R28: The area in Natura 2000 sites under commitments for protection, maintenance or restoration. Output indicator I19: Percentage of species and habitats of Community interest related to agriculture with stable or increasing trends.

22 Proposal for ERDF, CF, ESF Partnership agreement with Commission ERDF, CF, ESF, EMFF Programmes for Stakeholder involvement according to European Code of Conduct on Partnership Stakeholder participation in monitoring committee Allocation of funding GNI or GDP criteria MFF proposal: CF & ESF cut, ERDF increase Transfer of 5% - ERDF, CF, ESF, EMFF

23 How do ERDF/CF/ESF objectives relate to Natura 2000 objectives? ERDF & CF: PO 2.(b)(vii) enhancing biodiversity, green infrastructure in the urban environment, and reducing pollution Enabling condition for funding: obligation that the PAF has (1) all the elements required by the template for the priority action framework for agreed by the Commission and the Member States and (2) provides the identification of support for Natura 2000 implementation linked to the achievement of each fund s broad priorities the priority measures and an estimate of financing needs

24 ERDF opportunities for biodiversity and Natura 2000 ERDF REGULATION investments in infrastructure investments in access to services productive investments in SMEs; equipment, software and intangible assets information, communication, studies, networking, cooperation, exchange of experience and activities involving clusters technical assistance sharing of facilities and of human resources (Interreg) NATURA 2000 ACTIONS Site designation and management planning, site administration and communication with stakeholders, monitoring & reporting - one-off costs Restoration measures for green infrastructure (eg related to climate change adaptation and sustainable water management) one-off costs Natura 2000-related communication and awareness raising measures, education and visitor access

25 How will the impact of the funds on Natura 2000 be monitored and evaluated? Results indicator for ERDF priority objective on biodiversity: Surface of Natura 2000 sites covered by protection and restoration measures in accordance with the prioritised action framework Lack of cross-cutting indicators for Natura 2000 impact and fund specific biodiversity impact indicators

26 EMFF specific policy objectives Fostering sustainable fisheries and the conservation of marine biological resources; Contributing to food security in the European Union through sustainable and competitive aquaculture and markets; Enabling the growth of a sustainable blue economy and fostering prosperous coastal communities; Strengthening international ocean governance and enabling safe, secure, clean and sustainably managed seas and oceans

27 EMFF opportunities for biodiversity and Natura 2000 EMFF regulation Art 22: protection and restoration of marine and coastal biodiversity and ecosystems, including in inland waters Art 17: reductions in fleet fishing capacity Art 23: sustainable aquaculture Art 26: Local Action Groups Art 27 20: monitoring & data collection Art 29: support for coastguard Natura 2000 actions and measures management, restoration, monitoring of sites, habitats, species one-off and ongoing management agreeements Cessation of unsustainable fishing Sustainable aquaculture in Natura 2000 Training & education for fisheries & aquaculture managers Species protection measures seabirds, cetaceans, turtles compensatory measures for economic damage caused by protected species

28 How will the impact of the fund on Natura 2000 be monitored and evaluated? MS EMFF monitoring and evaluation framework - defined milestones and targets, indicators Results indicator (for freshwater, coastal and marine): surface (ha) of Natura 2000 sites (and other MPAs under the MSFD) covered by protection, maintenance and restoration measures More indicators to be developed in a delegated act Action Plan for Sustainable Coastal Fishing milestones, targets, indicators

29 Evelyn Underwood, IEEP,

30 Prioritized Action Frameworks restoration objectives

31 Payments for Ecosystem Services