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Nature recovery in the Esk Valley

Developing a  funding model

The Esk Valley - why is it special?

The Esk Valley is situated in the northern corner of the North York Moors National Park and is characterised by a mosaic of habitat types including moorland, farmland, grassland, woodland and rivers. The River Esk is the main watercourse in the valley and flows for 28 miles from the upper reaches of Westerdale to Whitby where it enters the North Sea. The River Esk is home to an array of important wildlife including Atlantic salmon (Salmo salar), Sea trout (Salmo trutta) the critically endangered Freshwater pearl mussel (Margaritifera margaritifera). Other charismatic species in the valley such as Brown hare, Dipper, Kingfisher, Otter and Roe deer. The cultural and natural heritage, along with the dramatic landscapes make the Esk Valley a very special place to conserve and enhance.


Natural Environment Investment Readiness Fund (NEIRF)

The North York Moors National Park Authority (NYMNPA) was one of 27 organisations in England to secure funding from the Defra funded Natural Environment Investment Readiness Fund (NEIRF) to development a nature restoration project. NYMNPA’s project will focus on developing a model for restoring and creating habitats such as species-rich grasslands, riparian woodland and riverside meadows at a catchment scale. Enhancing ecosystem services will also be a prominent part of the project, with focus on carbon sequestration and water quality improvements.

The project is led by Palladium and NYMNPA, in partnership with Esk Valley Farmers Group (EVFG), Natural Capital Research and the Environment Agency. The project links to ‘Revere’, a UK-wide collaboration between National Parks and Palladium that aims to raise private capital to fund nature restoration. The project will explore the feasibility of funding nature recovery in the Esk Valley with private finance. No other projects in the UK are currently working with farmers on this scale to better understand the private financing opportunity in managing land for improved environmental outcomes.

The aim of the project is to test a theory that nature restoration in the Esk Valley can deliver long term economic returns for land managers, by generating revenue through sale of ecosystem services. The project will be undertaken in three phases and will operate until autumn 2022. These include:

Phase 1 focuses on natural capital baseline and restoration opportunity mapping. This involves mapping existing natural capital assets in the Esk valley to get a clear understanding of the current state of the environment. In addition, opportunities to enhance natural capital through restoration activities such as hay meadow creation and woodland planting, incorporated within current farming practices will be mapped. The ecosystem services generated through restoration will then be identified and options for selling them to provide a viable long-term income for land managers explored.

Site Inspection of ditch fencing and hedging

Existing natural capital such as hedgerows and trees will be mapped along with opportunities for habitat creation.

Phase 2 involves assessing the private investment potential. Once the restoration opportunities have been mapped in Phase 1, the project will focus on exploring if they have the potential to attract private finance to fund nature restoration delivery, maintenance and provide guaranteed annual income for land managers. To assess the investment potential of the project, a business model will be developed that compares the cost of delivering and maintaining the restoration activities, the revenue that could be gained from selling the resulting ecosystem services, and the investment requirements of the scheme. The project team will also work to identify ‘buyers’ of ecosystem services and design a long-term income model for land managers.

Phase 3 involves the design of restoration delivery agreement templates. If the restoration case and business model demonstrate the potential to deliver an attractive revenue to landowners and tenant farmers, and all parties wish to proceed towards implementation, draft restoration delivery agreements will be developed. These set out the roles and responsibilities of each delivery partner in restoring nature and specify how revenue generated through the project will be disbursed over the lifetime of the restoration project.

Over the next year findings will be reported to DEFRA and the land management community. By next autumn, it is hoped the project will deliver:

  1. A feasible restoration and land use transition concept for the Esk Valley. This will include nature restoration activities such as hay meadow creation, hedge-planting and woodland creation, and modelling of the water quality, climate mitigation/adaptation and biodiversity gain outcomes it has the potential to deliver.
  2. A commercial model for this restoration case. This will consider the costs of delivery and estimated long term revenues for land managers that can be generated from the sale of resulting ecosystem services.
  3. Draft agreements for restoration delivery. The agreements will set out the roles, responsibilities and income guarantees that delivery partners would sign up to if capital finance were to be raised to deliver the scheme.

If successful, the project has the potential to facilitate long-term restoration and management of habitats within the Esk Valley while generating sustainable incomes for land managers.