Researchers test ways to fund nature-based solutions

This is one of eight research projects funded by Formas, to help enable and promote investments for a sustainable climate transition. The project is led by Neil Powell, Senior Lecturer at the Centre for Health and Sustainability (CHS) at Uppsala University.

“Nature-based solutions are absolutely crucial to preserve and strengthen key ecosystem services. But right now, there is a huge funding gap as well as inadequate implementation processes to ensure that these solutions contribute to human well-being,” says Powell.

The project is interdisciplinary and is being conducted in collaboration between researchers at CHS and the Department of Business Studies. It has been developed within the framework of the Uppsala University Conflicting Objectives Research Nexus (UUniCORN).

Not just a technical or economic issue

Nature-based solutions can include the restoration of forests and coastal landscapes or a more sustainable use of natural resources. Despite their great potential, NbS are underfunded. At the same time, some of the existing forms of financing are difficult to adapt to the conditions in the communities where they are to be implemented.

This is one of the key questions in the research project. What is needed to make it possible to scale up nature-based solutions so that they can contribute towards local and global environmental goals?

“Our project proceeds from the insight that funding NbS is not just a technical or economic issue, but also a social, ecological and institutional challenge – which makes a transdisciplinary approach essential,” Powell says.

“We are therefore basing the project on co-creative methods to develop, test and adapt funding models that are rooted in local contexts and at the same time attractive to the actors funding the initiatives.”

Based on five case studies

The project is based on five case studies: Voxnadalen and the Stockholm archipelago in Sweden, and Namibia, the Democratic Republic of the Congo and Honduras. The researchers will work with local stakeholders, project developers, companies, policy workers and investors to explore the adaptations needed to enable the scaling up of NbS in an ethically sustainable way.

“The aim is to co-create financing solutions that not only enable more NbS projects, but also strengthen local ownership, promote social justice and ensure ecological sustainability,” Powell explains.

Why have you chosen these particular places?

“There is an incredible diversity of ecosystems worldwide, all of which need to be preserved or restored. However, existing funding mechanisms have favoured ecosystems that rapidly sequester carbon. Therefore, the project will work to develop various financing solutions for ecosystems that cannot compete with, say, tropical forests in terms of carbon sequestration rates. The need for nature-based solutions is spread across the planet and the programme recognises that the diversity needs to be reflected in funding opportunities.”

Sustainable and fair climate solutions

Powell hopes that the project will not only contribute to the development of new financing models, but also to a broader understanding of what it takes to scale up sustainable, equitable and place-based climate solutions.

“We are going to use an action research approach, which aims to promote concrete changes in the case studies. In addition, we want to gain insight into how to address the mismatch between local needs and investor preferences, which is currently a significant barrier to scaling up nature-based solutions.”

Annica Hulth