The FIRNS will follow in the steps of the Investment ready Nature in Scotland (IRNS) grant scheme launched in August 2022 to address two of the four major barriers to scaling investment in UK nature identified by the Financing Nature Recovery UK initiative:
- Limited sources of revenue – Nature is systemically undervalued, and many ecosystem services are public goods, meaning there is no incentive to pay.
- Limited pipeline and scale – Limited capacity in the supply chain mean that projects cannot be aggregated to a scale that would attract investment.
The FIRNS is a joint initiative between Scottish Government, NatureScot, and the National Lottery Heritage Fund Supporting the development of environmental projects in Scotland that:
- aim to value and monetise ecosystem services derived from the restoration of natural capital assets, in a model that will attract and repay investment or support an investment model that can be scaled up and duplicated elsewhere.
- generate social and economic benefits in line with Scottish Governments’ just transition principles as well as provide increased access for people to enjoy nature.
Through FIRNS Organisations and partnerships will be able to access up to £240,000 for projects that establish conditions for the restoration of nature and growth of natural capital through the use of environmental markets and/or private investment. Successful projects will also explore and demonstrate the means to co-create projects and to share benefits with community interests, contributing to a just transition.
Applications are encouraged from eNGOs, community groups, land owners, farmers and other private sector organisations, individually or in consortia.
The overall aims and ambitions of the FIRNS programme are to support the development of the pipeline of nature based projects:
- achieving or enabling the outcomes of Scottish government’s Interim Principles for Responsible Investment in Natural Capital*
- enabling swifter, easier and scaled up development of further nature-based investable projects across Scotland,
- valuing and monetising ecosystem services derived from the restoration of natural capital assets, in a model that will attract and repay investment or support an investment model that can be scaled up and duplicated elsewhere.
- helping grow natural capital markets that reach across rural, urban and marine settings, as well as a wide variety of natural assets and ecosystem services,
- creating or supporting the creation of new market infrastructures that would increase the transparency and efficiency of natural capital markets and enables their scope to grow beyond carbon sequestration in woodland and peatland.
- generating good quality natural capital related jobs and support the growth of diverse and robust indigenous supply chains and more generally generating social and economic benefits in line with Scottish Government’s just transition principles.
- pushing forward innovation or significantly advancing the knowledge base, experience and business maturity across nature based projects and sectors and share best practice with all major stakeholders, including local communities.
*The Scottish Government’s Interim Principles for Responsible Investment in Natural Capital define values-led and high-integrity in terms of delivery of integrated land-use and genuine and meaningful public and community benefits through inclusive engagement and collaboration in projects that are ethical and values-led, demonstrate high environmental integrity and support diverse and productive land ownership.
In terms of expected outcomes, the FIRNS programme will be focusing on market and investment readiness, just transition, testing the diversity of context, learning and influence, aiming for the following:
Programme level outcomes (mapped to the Business Case/Theory of Change Business Case):
1. A critical mass of projects achieving or enabling the outcomes of our interim principles for responsible private investment, enabling swifter, easier and scaled up development of further nature-based investable projects across Scotland through replication.
2. Growing natural capital markets that reach across rural, urban and marine settings, and grow a wide variety of natural assets and ecosystem services.
3. Greater diversity of funding models for land managers.
4. Increased confidence of private sector buyers and investors seeking to engage in markets, or achieve a financial and environmental return on investment.
5. Land managers and communities are better informed about, and more able to engage with, environmental markets and private investment in natural capital.
6. New and effective means of engaging communities and securing community benefits from environmental markets and private investment in natural capital
7. New market infrastructure that increases the transparency and efficiency of natural capital markets and enables their scope to grow beyond carbon sequestration in woodland and peatland.
8. Good quality jobs and growth of diverse and robust indigenous supply chains
9. Greater understanding of further government interventions needed to unlock barriers to nature capital market development.
The lessons learned from FIRNS will also influence the National Strategy for Economic Transformation (NSET) programme, by demonstrating the relevance, value and achievability of responsible, values-led, high-integrity natural capital-based markets.