FIRNS - Contacts and Resources

Latest news release

Investing in Nature - New funding to help projects grow - Friday 22 September

Ministerial announcement news release - Friday 17 February 2023

Webinars/Workshops

Round 2 Information Webinar

Engaging with Buyers - 23 May 2023

Baselining and Estimating Ecosystem Services - 16 May 2023

Working with Scottish Landholders - 2 May 2023

Starting Your Project's Development - 25 April 2023

Community Engagement and Benefits - 4 April 2023 

‘Introduction to Investment Readiness’ - 21 March 2023

Launch webinar hosted by the Scottish Nature Finance Pioneers: 
28 February 2023

Agenda
Welcome
What we want to achieve
How will the Grant Fund Work?
Q&A

The Investment Readiness Toolkit is an online and interactive framework that takes nature-based project developers and enterprises along the eight milestones of a path to Investment Readiness, providing key considerations and case studies.

Agenda

• Welcome and Introduction
• Launch announcement by Mairi McAllan MSP, Minister for Environment and Land Reform
• What is FIRNS & how will it work? 
• Working in partnership  
• Q&A
• FIRNS webinar series 
• Next steps
   

Clark: One wouldn’t want to be prescriptive about the types of community engagement that will come out of these projects, which we are expecting to be innovative and an early stage. What we’ll want to see is.

• how good is the planning to support whatever community engagement you wish to undertake in your project,
• are you putting enough resource to manage that well and to make sure you are accessing different parts of the community who might not have their voices heard as easily as others.

In our experience, the choice of community groups you wish to engage with, and the related planning work, are bespoke to the area you are working in and to the project. For some projects, it might be a particular agricultural community, or land managers, or young people – it very much depends on what your project is and what it needs to make sure it has traction and can be delivered effectively, and also that the benefits that your project creates have a legacy after your work is complete, because you’ve engaged with the community effectively. Given the nature of the projects we expect to see, I imagine we’ll see more about building the mechanisms, resources, and starting the initial community engagement activities, rather than necessarily the doing and implementation of these activities at this point.

Uttley: The answer in principle is yes. FIRNS is intended to fund particular activities around enabling project developers to access new sources of finance and funding for natural capital and biodiversity. The criteria is that it would have to be new work being funded, even if it is expanding a project, and it has to be that particular type of work on bringing in new sources of finance, not on the ground work. Having an existing foundation of work could be really helpful.

Uttley: As above, there is no reason in principle that FIRNS funding can’t be added into a project that is already receiving NRF funding, as long as it is funding new work and not duplicating. If you’re unsure as to what that constitutes, please get in touch at [email protected] and we can help to provide some clarity.

It is all new funding and separate to the Nature Restoration Fund.

Uttley: £1.5m available in the first round of FIRNS. We’ve not put in a minimum application amount in the guidance. There may be some projects that we feel are just too small, though there isn’t a rigid threshold for that.

Uttley: We know there is some work being supported by the NEIRF on additional codes and standards, such as saltmarshes and hedgerows. We don’t have a fixed view on this, so where there is a gap, then clearly projects would be welcome. Where there is a desire to take a different approach to that which is already there, or to develop existing approaches further, we would be open to applications on this. We are in the phase of innovation in these markets, and we don’t expect everyone to get everything right the first time and there is room for activity in parallel. However, anyone wanting to develop a code that treads on the toes of codes and standards that are already there, we would want to see evidence that this is being managed appropriately, that activities are thought through and connections are being made with existing bodies of work, so we’re not supporting chaos!

IRNS ran in the summer of 2022 and was delivered by Esmee Fairbairn in collaboration with NatureScot and the Heritage Fund – it now has seven projects that will run for another 12 months potentially. FIRNS builds on IRNS, though there is no direct relationship.

Uttley: All of these figures are correct, but correct for the NatureScot delivered element, so you can double these potentially when considering NLHF’s component.

Clark: We are running these as two separate grant programmes, but have spent a huge amount of time behind the scenes to align timelines and profiling budgets together, so we’re able to support around this important policy area at pace. Projects submitting Expression of Interest (EoI) forms will receive feedback from both NLHF and NatureScot at the same time. We will assess on a similar timetable so that grants are released from both organisations at the same time to support each project. Critically, you shouldn’t apply for funding for two different projects, it is one single project and we will split the funding between our organisations based on the content of the project.

The EoIs will be helpful for giving you feedback and guidance on this process as well and how your project might align with the two grant schemes. We’ve specifically designed this process to be smooth and aligned to best support projects.

Sime: This is a similar system as to the grant scheme that NLHF has already run with Historic Environment Scotland, so there is experience elsewhere in this sector of running this parallel process, and FIRNS stands on the shoulders of that. To emphasize again, for those projects that submit EoI forms, we are primed and ready to help smooth the navigation of this process.

Uttley: Yes. There is quite a lot of detail on the website as to what is eligible, and in fact one of the main functions of the FIRNS is to provide access to that specialist advice, as we know this can be expensive to bring in.

Uttley: Yes. We talk a lot about transforming land use but we equally need to intervene in the marine environment. It is true that market approaches in the marine environment are further behind. Also we have Scottish Marine Environmental Enhancement Fund (SMEEF) and we want to build on that, so please do come forward with applications on the marine environment.

Clark: We’re expecting to see all types of projects come forward, but the key thing is that these achieve the Responsible Investment principles. From the perspective of the NLHF, as long as there are strong community engagement mechanisms built into the project, and it delivers benefits to local communities and the environment, we’d be happy to see applications on these.

Uttley: It is not a scenario we envisaged in FIRNS planning, and it might be a little outside the routes to new finance and funding that we’re looking to encourage, but I wouldn’t say no. I think it also comes down to how innovative it is and how the nature restoration or ecosystem service provision sits alongside the community renewable project and how they fit together. This is probably the critical element. Once again, we’d be happy to have a conversation on this through [email protected].

Uttley: This is a very live issue. The route to addressing it will be through SG and UKG policy along with measures included in carbon codes, especially the Woodland Carbon Code, the Peatland Code and other new UK carbon codes.

Herko: Ben Hart from Highlands Rewilding has been championing the idea of a 'Sellers Charter' - i.e. a common ethical charter for producers to follow. If you are interested, please join Scottish Nature Finance Pioneers/contact me at [email protected], as we are convening some exploratory discussions around this idea.

Uttley: No, we don't expect projects to have made links with investors before starting.

Uttley: You’re welcome to apply again in the second round if unsuccessful. At the moment, FIRNS is envisaged to run over two years and two rounds. We will provide constructive feedback to all unsuccessful projects, and we hope that this will be useful in a) deciding whether to apply again and b) improving your second application.

Sime: There will be two separate reporting systems as these are two separate grant programmes, but we are working to smooth this process as much as possible so that the same information can be used in the applications and in the reporting requirements, making it as comfortable and painless for grant recipients as possible.

Sime: When it comes to the applications (as opposed to the EoI forms), there will be two applications to submit for the NatureScot and NLHF grants. However, as with reporting, we are working together to make sure the application forms are as similar to each other as possible and information can be easily reused. This is because we have the same outcomes that we’re looking to achieve. It’s not that NatureScot doesn’t care about communities and NLHF doesn’t care about nature restoration – overall the FIRNS is one scheme with mandatory outcomes for all projects that relate to both components.

Uttley: Match funding from other sources is not mandatory. Between NLHF and NatureScot, we can cover up to 100% of costs, and expect to do so in many cases. However, if there is other funding in the mix then that improves value for money, so I wouldn’t discourage people from looking for other sources of funding.

Dowen: Building on this, one of the reasons that the Scottish Government has worked so collaboratively with NLHF is to help applicants with the fact that match funding is often sought in grant schemes, and to increase the scale and breadth of activities that can be funded. We want FIRNS to support progress towards natural capital improvements and the Just Transition.

 Introduction to Investment readiness Webinar Video Recording

[Uttley]: BNG is a term that should be reserved for England. Yes, there are provisions in NPF4 but it is much less prescriptive. The detail is in Policy 3 on page 38.

[Avery]: The GFI Investment Readiness Toolkit has gathered a few examples of contract templates that project developers, including Palladium, have kindly shared. Please see the useful links section of Milestone 8: Establishing Legal Contracts and Closing.

As the market develops and project developers share further learnings, the GFI hopes to collect more contract templates for consideration. The FIRNS is coming with a Community of Practice, where conversations about legal contracts, templates and clauses will also be supported.

[Uttley]: The further along in landholder engagement you are, the stronger your application will be perceived. However, we are not expecting projects to have achieved formal agreements before applying, and we expect many projects to be at the start of this journey, especially if they are applying for Development Grants.

To give your application and project the best chance of success please evidence current levels of commitment, who you have talked to about what, and what your plans are for engaging landholders,.

[Gibson]: One of the things that the Finance Earth team has found useful is having options – multiple potential sites – engaged to show that you can still proceed with the project even if conversations with your preferred landholders falls through.

[Uttley]: Timing of Round 2 has not been set yet. But we hope to be able to offer Round 2 grants in March/April 2024 with a 12-month run-time. We may need to find a way to fast-track R1 Development Phase projects into Round 2.

[Avery]: This is entirely dependent on the project you are building and its financial model – security may not be needed or even up-front investment altogether.

[Gibson / Gegg]: We would recommend thinking about this question at the later stages of project development, and first capturing an accurate picture of the costs and revenue streams over the lifetime of the project. At this point, you can identify any investment gaps and negative cashflows and the conversation will naturally turn to how this gap can be met.

[Uttley]: In principle yes, especially for habitats that don’t have existing pathways for carbon credits available.

Where there is potential overlap with existing mechanisms (noting where various NEIRF projects are developing carbon codes for different habitats), it will be important to demonstrate where the added value is of this new pathway. The market is still at a very early stage of development, and there is room for innovation, but showing that you’ve considered others’ work will help your application.

[Gegg]: The two carbon codes (Woodland Carbon Code and the Peatland Code) contain ‘unit buffers’ that take c.20% of units from all projects registered with the Codes and pools them into a single reserve – so that if there are fires or natural hazards that destroy the habitats, the buyers can still draw from this pool and receive what they paid for. This is in the case of natural hazards, though if there is damage relating to landholder or project developer negligence, the rules are different and there is a financial penalty built in.

Kita now offers insurance for buyers of carbon credits as well: https://www.kita.earth/

[Gegg]: The revenues for a particular ecosystem service can be broken down into three

• The yield or amount of ecosystem service uplift – such as tonnes of CO₂e sequestered through woodland creation over 30 years.
• How much you want to sell, versus how much you’d like to reserve.
• How much you are charging for each unit of the ecosystem service.

Facility for Investment Ready Nature in Scotland (FIRNS) Application Clinic Drop-In Sessions - 31 May, 1 June 2023

Q&A

Session 1 - 31 May 2023

Q1. For the application to the National Lottery Heritage Fund (NLHF), do we use the application form on the FIRNS website or the NLHF portal?

Please use the NLHF online portal for the NLHF application, via the ‘Grants for Heritage £10,000 - £250,000’ process. 

Sign into the NLHF application portal. You will need to create an account if you haven’t already done so. See general guidance on applying to NLHF.

Q2. The application form asks for ‘Your NatureScot FIRNS project reference’ – should I have received this?

Please leave this blank - it will be assigned after applications are received.

Q3. Will grant management reporting be consistent between NatureScot and NLHF?

We are aiming to make this as seamless as possible however there will be two separate reporting systems as these are two separate grant programmes. We are working to align this process as much as possible so that the same information can be used in the reporting requirements to both NatureScot and NLHF. 

For Development Phase grants (and all those under £100k), a simpler payment process will be used, with NatureScot mirroring the standard NLHF approach for grants under £100k – i.e. 50% paid upfront, 40% paid once 50% of the costs have been incurred and evidenced, and a final 10% paid at project completion.

Q4. Are there any procurement requirements relating to paid partners in the project, as opposed to sub-contractors?

You will need to follow a procurement process for sub-contractors on the project, demonstrating evidence of open and fair procurement. The roles and tasks of paid partners can be covered in a Partnership Agreement.

Guidance on the evidence required to support NatureScot’s procurement requirements is shown below. Guidance will be also issued shortly on use of the Real Living Wage in project roles, but all applicants should pay all workers in their project at least the Real Living Wage.

All applicants should demonstrate good procurement practice by inviting open and fair competition, applying the thresholds below:

Q5. If partners are on board due to specific skillsets and will be submitting invoices to be included in grant claims (but are engaged as partners not contracted), are we right to assume that these roles don’t need to be tendered?

We would want to see partner roles and responsibilities set out and formalised in a partnership agreement. Partners can include evidence of staff expenditure for a grant claim using timesheets and receipts, rather than invoicing. We would also require evidence that the in-kind contribution of a particular partner makes them an essential part of the project. Development phase projects might include the creation of the partnership agreement within their project activities. 

On procurement generally, NLHF requires evidence of three tenders if procuring over £10,000 (cumulative over the project), and NatureScot needs to see evidence of inviting three tenders for projects over £1,000 (see further guidance in Q2 above).

Q6. Can a single tender justification be used for project partners with specialised skills where there is only a limited pool?

NatureScot has criteria for when a single tender process can be followed but would generally expect to see a competitive tender process undertaken to test the market and provide evidence of a limited pool, even if only one tender is received.

Q7. For development phase applications, should the monitoring questions be answered in relation to the development grant project, or the longer-term delivery project?

We are most interested in the outcomes that will be delivered during the development grant period, but it would also be useful to demonstrate some thinking about outcome monitoring for any eventual Market & Investment Readiness project or nature restoration delivery project.

Q8. Should ‘the Project’ described in the application form focus on the activities that FIRNS funding is being requested for (i.e. development / marketing and investment readiness), or the eventual nature restoration project?

The application should focus on the work that will be delivered with the FIRNS funding. But it will also be useful for assessors to understand what the eventual project will deliver for nature and communities once private finance has been secured. 

It will be useful to hold both the immediate project and the longer-term ambition in mind. Development phase projects should establish the mechanisms that will help you to succeed in the next phase – e.g. inclusion, partnership structures, delivery models etc.

Q9. Will projects be scored down if too little information is included on the eventual nature restoration project? How will scoring be split between the immediate and longer-term project? (Noted that some EoI feedback related to the eventual nature restoration project).

Development phase projects will be scored in relation to their plans for reaching the aims of their development project, but also in relation to the wider delivery project. Please contact us if you need to discuss this further in relation to your EoI feedback. But please be aware that our resources for feedback at this stage are very limited. You can contact FIRNS at [email protected] and at [email protected] for NLHF specific queries.

Q10. Is there a deadline for development phase projects to be completed? Do they need to complete within 6 months of the grant offer, or could the project start date be delayed till Spring to allow for more successful community engagement not in the winter months? (This particular project would have value even if it missed the opportunity to apply for next stage funding in the second round of FIRNS.)

It’s great to see that practicalities and barriers to engagement are being considered. 

However, the 6-month maximum duration has been set with a view to Development Funding projects being completed in time to be able to progress to any next round of FIRNS for Market & Investment Readiness funding. Timelines overall are constrained by the deadline for all FIRNS projects to complete by March 2025.

We encourage you to apply to FIRNS while looking at options for mitigating the risks of low engagement, and/or to manage expectations in terms of what is achievable over the winter months, perhaps focussing on the planning of the future phase engagement (as opposed to engagement delivery).

Q11. What process is envisaged for completed Development projects to apply for the next phase funding (Market & Investment Readiness) in the next round of FIRNS? Will this be an open competitive round, or some other process, and is a timing gap envisaged between the two project phases (e.g. to allow for evaluation)?

The process for funded Development projects moving to the next phase as FIRNS Market Readiness projects is still to be confirmed. But projects should plan on the likely basis of a timing gap and a competitive funding process.

Q12. Is there a template for the Project Plan that is required with the application?

Yes. Please use the template on the National Lottery Heritage Fund website.

Q13. Are templates available for any of the other supporting documents required with the application?

Applications to NatureScot should use the Project Finances Spreadsheet available on the FIRNS website. This has been designed to match the cost categories in the NLHF online application.

For guidance on the other supporting documents, including a recommended template for a Project Plan, please refer to the NLHF application guidance - see ‘Supporting Documents’ section on this webpage.

See the website for an NLHF template for Commissioned Briefs.

Neither NatureScot nor NLHF has templates for Full Cost Recovery Calculations, Partnership Agreements or Risk Register. However, the following examples from the National Lottery Community Fund may be useful:

• TNLCommunity Fund Guidance
• TNL Partnership Agreement document

Q14. Does the lead organisation for the NatureScot bid and NLHF bid need to be the same? This is in the context of capacity limitations and facilitating flexibility within a consortium application.

Yes, the same applicant would be ideal to avoid confusion in the double process. That doesn't necessarily mean that the submission itself can't be made by someone else or another partner in the project. The lead applicant has the legal responsibility, so any sharing of roles should be set out in the partnership agreement. Whoever accepts the grant offer carries the responsibility for submitting claims, providing evidence, reporting etc.

Q15. How many projects does FIRNS expect to fund?

We have no fixed number as this will depend on the value of the individual applications, and the balance of Development phase grants versus Market and Investment Readiness phase grants, working within the overall fixed budget available. We do expect the process to be very competitive.

Q16. Will there be opportunity for projects to address any issues identified during the assessment process?

We want to fund good ideas, and Funding Officers at both NatureScot and NLHF will follow up during assessment if there are details needing clarification. There is also opportunity for some details to be clarified during project start-up meetings.

Q17. Our EoI feedback advised that baseline surveys were not an eligible cost. Would collation of the various interventions that could be possible in the project be an eligible cost?

The collation of interventions could be eligible if they contribute to the potential to measure or evaluate impacts. In other words, desk-study baselining work would be eligible while fieldwork surveys not. 

Q18. Our EOI feedback advised us to evidence at least initial discussions with potential partners when we submit the application form. Would you need email exchange history as evidence? Or what specific evidence would you need? Our application is for the development phase. 

Simple letters of support would suffice for demonstrating support from landowners, partners and other key stakeholders. A one-page outline partnership agreement could also be considered. As last resort, we could consider simple email exchanges if sufficient information is included in the messages.

Q19. There have been a few webinars recently that I wasn't able to attend; will they be uploaded onto the website soon?

Yes, we will update the FIRNS website as soon as possible, but in the meantime they are also available on the Green Finance Institute website.

Q20. We are unsure about whether to submit a FIRNS application now, or wait for a possible Round 2 of FIRNS if we’re not quite ready yet?

Plans for a second round of FIRNS are not yet confirmed. If you have already submitted an EoI or have a well-developed project idea, we encourage you to submit a full application to the current round.

Q21. Not asked as a question, but on project start dates and end dates:

Funding decisions are expected at the end of August. It will then take a few weeks for grant offers to be sent out, negotiated and accepted. Projects should plan for this when completing their applications in terms of likely start dates, with a view to those being in October.

Development funding projects are required to complete within 6 months. Market and Investment Readiness projects must complete no later than March 2025, although we would welcome MIR projects that can complete in a shorter timescale. 

Session 2 – 1 June 2023

Q1. Do we need to include quotes from contractors in our application? 

We suggest that you speak with potential contractors before submitting your application to establish estimated costs for your project. If successful, you will need to receive quotes and appoint contractors through a fair and transparent procurement process in line with the funding rules. All claims need to correspond and support the quotes received from contractors. 

Q2. We’re in the process of setting up a not-for-profit organisation to lead the project however it’s unlikely to be established by the application deadline. Can another partner step in as Lead Partner for the purposes of submitting our application then change the Lead Partner to the notfor-profit organisation once it’s fully established? 

We encourage the same organisation to submit the application as will be the signatory of the grant offer. However, if another Lead Partner has to be constituted and will be the signatory of the grant offer, that should be possible and please indicate that intention within your application with evidence that it will be achieved by the end of August.  It will much more challenging and time consuming to make such a change after an award has been offered.

Q3. Can existing carbon codes such as peatland and woodland codes be included in FIRNS? 

We expect many projects to include the existing codes. We are interested in the way in which applicants focus on innovation, wider community engagement, equitable benefits, and scalability of their natural capital projects. 

Q4. We are currently running a project that is funded through the Nature Restoration Fund in partnership with various organisations. We wish to apply to FIRNS to progress the long-term goals of the NRF funded project e.g. develop a governance model and continued restoration through entry to natural capital markets. Is this possible?  

We advise caution as this may result in double funding. Activities proposed for FIRNS must be related to non-capital activities. It is advantageous to make the most of the complementarity between the NRF and FIRNS (and other funding streams) and demonstrate how you could build on long-term restoration goals in your application. 

Q5. How much flexibility is there to change project activity budgets and/or move budget lines once a project has started? 

Whilst it’s preferable to stay as true as possible to your application proposal, we appreciate the need for some flexibility. Successful applicants will be assigned to a Funding Officer who will need to know of any changes as soon as possible to advise and assist. 

Q6. We have decided to scale back the activities and budget in our Development project to fit in with the 6 month timeframe. Will our application be less competitive?

Scaling back the budget and activities doesn’t necessarily mean that the project is more or less competitive. We advise submitting an application. 

Q7. How do we decide whether we’re suitable for a Development Funding project or Market & Investment Readiness (MIR) project? 

Although each case is different, if you have identified the activities, budget, partners and baselines required to implement a long-term project then we would advise applying for MIR funding. If you need to explore the viability of a project and explore partnerships and activities, then we would advise applying for a Development Funding project. 

Q8. Our organisation takes a minimum of 3 months to process corporate procurement, and this can’t commence until funding is secured, therefore this would leave only 3 months to implement the project within the 6 months allowed for Development phase projects. Could our 6 month project commence after procurement has been completed? 

It would be unfair to change the goalposts for different projects based on an organisation’s procurement procedures and we cannot guarantee extending the project timelines. One option may be to work with an organisation within your partnership that can process procurement more quickly or explore other options. Having a 3 month procurement process will be challenging for a 6 month project.  

Q9. Does a successful application to FIRNS exclude us from applying for other NatureScot or National Lottery Heritage Fund grants? 

No. Several organisations receive grants from different funding programmes. 

Q10. Will we be able to apply for Market & Investment Readiness funding if we haven’t completed our Development Funding project? 

The aim of the FIRNS programme is to ensure that suitable Development Funding projects are able to progress to a Market & Investment Readiness project. We will provide more clarity on timescales and any potential second round of funding during the assessment of the first round’s funding applications. 

Q11. Will there be flexibility and allowances to complete and progress Development Funding projects to a Market & Investment Readiness project? 

As the FIRNS support team will be familiar with the Development Funding projects, we will take the end point of Development Funding projects into consideration when confirming any arrangements to support potential progression of projects to any next round of FIRNS for Market & Investment Readiness funding. Timelines overall are constrained by the deadline for all FIRNS projects to complete by March 2025

Q12. We want to develop a new business model to make our current project financially viable. Do we need to have worked out what the business model is before applying? 

Although you may not have identified all of the operational details and workings of your business model, we advise that you suggest suitable principles and potential business models in your application. Giving as much information as possible on potential revenue streams and potential buyers/investors will be beneficial, even if in the final project they are not all retained or new ones are added.

Q13. We work with a Land Manager who uses his own Solicitor. Can we use this Solicitor without going through a procurement process? 

A single tender process can apply in instances such as this. You will need to seek approval from your Funding Officer if your project is approved and have written confirmation that a land manager cannot operate with other solicitors. 

Q14. Our EOI feedback advised that we reduce activities to identify natural capital baseline and building capacity (i.e. surveying costs). What can be covered by FIRNS? 

FIRNS does not cover fieldwork surveying costs however it covers desk studies. We recommend to focus on the latter (desk studies) if possible or fund fieldwork surveying costs through other means.  

Q15. I’m not sure if we’re ready to submit an application now. Should we wait to apply in a second round? 

We suggest that you apply in the first round. Plans for a second round of FIRNS are not yet confirmed. If you have already submitted an EoI or have a well-developed project idea, we encourage you to submit a full application to the current round.

Q16. Can we have an extension to the application deadline? 

Due to the timescales of the FIRNS programme, this isn’t possible.

Q17. Not asked as a question, but on project start timescales and procedures: 

There will be a time lag between decisions in August, receiving the grant offer and project start. Applicants should not incur any expenses until they have received and signed the grant offer.  (See also Q21 from Clinic 1 above)

Q18. Within an application, can we include a partnership that has not yet been formally established?

Please provide evidence of potential partnerships with documents such as letters of support, MOUs or as last resort email exchanges if there is no formalisation yet.