Insight: Scotland looks to take action on Natural Capital Finance & Recovery with the launch of FIRNS
When the Scottish Government announced the IRNS (Investment Ready Nature Scotland) in 2022, there was always a view for a larger scheme to follow. This week, that scheme has been announced with the FIRNS (Facility for Investment Ready Nature in Scotland), with NatureScot and the National Lottery Heritage Fund announcing a new funding opportunity for nature finance. The new scheme looks to help build knowledge, understanding and capability around how private finance can be leveraged to the benefit of nature.
The FIRNS looks to support the development of natural capital markets in two ways, which has similarities to the second round of DEFRA and the Environment Agency’s Natural Environment Investment Readiness Fund (NEIRF).
The funding is split between NatureScot and the Natural Lottery Heritage Fund, with the two funders running in parallel with similar outcomes, and projects will be signposted as necessary to the appropriate funder once an expression of interest has been submitted. There are two distinct types of grants on offer:
The Development phase – aimed towards project developers to prepare for market and investment readiness (with an indicative maximum of £100,000).
The Market and Investment Readiness projects – aimed at project developers looking to advance their plans for implementation, including access to markets and attracting private investment (with an indicative maximum of £240,000).
The timeline indicates the phases for projects to apply, beginning with an initial expression of interest which is available between now and the middle of April. These will be met with feedback to then build into the application process, which opens mid-April through to mid-June, with the projects beginning from August 2023 (see timeline here). The grant can fund up to 100% of eligible costs and provides an opportunity to share learning and expertise with the natural capital community of practice.
Source: Aleksandra [Unsplash]
The scheme looks for projects that help to grow markets in new and existing ecosystem services, looking to restore nature across rural, urban and marine settings. Ideally resulting in a critical mass of projects supporting Scotland in reaching the interim principles for responsible private investment. By encouraging applicants, the scheme is aiming to diversify existing funding models, working with landowners and communities to leverage private finance to help improve the natural environment. FIRNS is aimed at constituted organisations (charities, trusts, community groups), in addition to community interest companies, public bodies, private organisations and individuals in addition to academic institutions.
Accelar has a track record in advising organisations, both public and private, in obtaining grant funding and developing nature-finance based projects to harness private sector investment. Working on several NEIRF-funded and similar projects across carbon, biodiversity, water catchment and many other markets, we use our in-house knowledge and analytical capabilities to navigate the complex and new world that is nature finance. Our Nature Finance Impact Hub also provides free to access data on existing nature positive projects, highlighting how private finance can be leveraged to improve environmental outcomes.
Please get in touch if you’re thinking about applying to FIRNS or if you have any questions about nature finance and the Impact Hub.