Setting Up A Habitat Bank In Plymouth
Habitat banking is an emerging area of green finance, providing a means to secure funding for the improvement of habitat for biodiversity from investors. Plymouth City Council saw an opportunity through their Future Parks project to develop a habitat banking vehicle, taking the opportunity to build a strong business model for this work.
WHAT WE LEARNED | 4 MINUTE READ
Chris Avent
Green Estate Manager at Plymouth City Council and is one of the project managers on the Future Parks Accelerator project in Plymouth
James Rogers
Investment Officer for Natural Infrastructure at Plymouth City Council
Kat Deeney
Head of Environmental Planning at Plymouth City Council and Lead Officer on the Plymouth FPA programme.
Starting From Scratch
Habitat banking is not – yet – hugely prevalent in cities and towns in the UK, but the PCC team saw an opportunity and had support from the FPA to test it out.
Chris
“There are many different types of green finance, but we had to narrow it down and focus on one to start some dedicated work. It was quite hard, because there are some great opportunities out there and we're very good at doing lots of things at once here, but we did manage to force ourselves to pick just one. We landed on habitat banking because we had enough data and background knowledge to inform building a strong business case and business model behind it.”
Quantifying Nature
The biodiversity net gain metric helped the team do something really difficult - put numbers on nature.
Chris
“In the environmental sector we talk a lot about how we quantify nature. Biodiversity is much harder to place a value on than, say, flood risk which poses a direct threat to property. The biodiversity net gain metric is a really powerful way of doing that for natural habitats in a way that means it doesn't just sit in its own little bubble as a “nature thing”, it actually links to the wider strategic development of the city. This metric gives us a figure to then talk about whether it’s worth disturbing or destroying a certain habitat for development. It’s really important particularly in an urban context.”
Ethical Complexity
There’s some discussion around whether it’s a good thing to “quantify” nature, but the PCC team believe it’s crucial.
Kat
“The first thing to understand is that Biodiversity Net Gain is now set out in law so the existence of biodiversity units is actually beyond our decision-making power. We want to make the best of this and not lose out on the benefits it can bring. Once developers understand the net worth of biodiversity from a pounds and pence perspective, they usually change their plans. Whether we like it or not, this is the world we live in. So, we need to talk in the language others understand. Habitat banking helps us drive greater benefits than we’ve ever seen before – we used to maybe get money to compensate loss or to equal things out, but this is actual gain. We’re developing the first system where nature has a return that we can do something really good with.”
Chris
“We're never going to stop cities growing and experiencing the impact that will have on our green and blue spaces, but it’s about generating more positive impact. Having worked with the concept of biodiversity net gain before I’d worked through the moral questions, I’d already danced with the devil on a professional and a personal level as well. I knew what the benefits would be for longer-term habitat and biodiversity gain. It’s not greenwashing, it’s genuinely about deriving finance to support habitat improvement.”
Don’t Underestimate Local Authorities
Local authorities are uniquely positioned to supply biodiversity units.
Chris
“In Plymouth, our local authority is quite a big landowner with 1400 hectares of green space around the city. There’s quite a bit of opportunity to take land that can often be seen as a liability to local authorities – think trees that can fall over – and turn it into genuine assets that provide an income stream which in turn goes back into maintaining and improving green spaces.”
Kat
“By doing this ourselves, we can really be very specific on the land changes that we'd be happy with. It gives us “triple bottom line outcomes”: we get the environmental benefits, we ensure the social benefits for our communities and it means that any surplus stays in the city to help serve those communities, rather than to make profit for somebody else.”
Embrace New Learning
You don’t need to be a finance expert to set up a habitat bank.
Chris
“When I first got into the world of investment finance, a lot of it went completely over my head. It took some real work at the beginning to learn that world. I now know that, as an environmental professional, it’s my knowledge about green spaces that’s crucial to the finance experts.
After the initial phase getting to grips with finance terminology and concepts, I quickly began to understand my role in shaping this. I bring the knowledge of being an environmental professional, knowing what is and isn’t possible in terms of habitat enhancement and what it takes to do it. When we started working on the habitat bank concept specifically and we were asked to set out some of the specific opportunities for the finance team, I really understood my role in this process and that I didn’t have to know all of it. Cue sigh of relief!”
The Future Of Habitat Banking
As a fairly new form of green finance, the team are keen to see how habitat banks can be used more by local authorities – and they’re key to sharing their learning with others to help them.
Chris
“Next, I’m excited to look at the habitat banking vehicle as one of the drivers to achieve local nature recovery. That’s a commitment from the Environment Act that every local authority is going to have to achieve and they’re going to have to find a way to fund it – habitat banking could be how.”
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