Ecosystem Restoration Code: engagement paper

Notes

¹ This is an initial coarse level analysis only of potential opportunities. It is intended to be illustrative and not definitive.

² Subject to engagement and further deliberations on high-integrity issues (see Chapter 2), ERC could potentially be bundled / stacked with WCC and PC (two opportunities). However, WCC and PC can only be stacked with ERC (one opportunity).

³ The analysis of potential blended finance opportunities is cursory only and makes the following assumptions: (a) ERC will be highly appliable for blending with all relevant public grants because it is likely to apply to most terrestrial habitats and land system contexts; (b) for all market mechanisms blending will be subject to prevailing rules on financial additionality – these are in development for ERC; (c) blending options under WCC are limited to FGS and potentially future agricultural support; (d) blending under the PC may be possible with future agricultural support and NRF but the most significant option will continue to be Peatland ACTION; and (e) FGS cannot be used for blending in forest-to-bog projects should this become an eligible option under the PC.

⁴ The eight broad habitat categories from the UK National Ecosystem Assessment (NEA) have been used as a simple habitat typology to facilitate this analysis which intends to show which habitat contexts the market mechanisms could potentially operate in. However, there is a distinction between ERC and the carbon codes: (a) WCC and PC channel private investment into woodland creation and peatland restoration respectively. This could occur on broad habitats other than woodland and wetlands (e.g. woodland creation on heathland, peatland restoration on agricultural land^[99]) however the interventions under the carbon codes won’t necessarily work to restore the extant / underlying habitat; and (b) because the ERC is outcome focussed it is intervention agnostic – ERC projects have the potential to restore all terrestrial and wetland / floodplain habitats with the exception of urban (due to scale issues)