GB-COH-08195029-CAPE Environmental Finance Limited, trading as Finance Earth Carbon markets, although nascent and imperfect, have emerged as a market-based solution for attracting private funding for climate mitigation. While flows are still modest and significant concerns remain over integrity in many projects, growth prospects are positive. Biodiversity, on the other hand, is much more complex than carbon, and so establishing nature markets and “internalising the externality" represents a much bigger challenge. In addition, project developers looking to develop nature-based solutions (NBSs) with carbon or biodiversity positive outcomes face many other challenges: high upfront costs, lack of transaction structuring and investor negotiation skills, varying investor requirements and legal/political risk with unclear property rights or regulation. As a consequence, there is currently limited investment in biodiversity focused projects. CAPE will identify and accelerate select projects which demonstrate the above synergies. The accelerator will provide both transaction advisory and technical project development support tailored to the specific needs of each project. When focused on the post-feasibility, pre-investment stage (the ‘Finalising design & piloting’ section in the figure below), it is envisaged this will create the demonstration cases to ‘prime’ the market. There is a significant gap in support for nature-focused projects that have established the feasibility of a solution, but who are finalising their design and commercial model. CAPE’s focus will be on getting projects to first financial close. Projects chosen must be prospectively commercially viable and thus will be post-initial feasibility, with work ideally initiated on the carbon project design document (PDD - specifying the technical and operation detail of how the offsets will be produced) and on the benefit sharing agreement design process (BSA - defining community engagement and benefit distribution) The CAPE Pilot has three core objectives: 1. Primary: To demonstrate how commercial business cases for investing in NBS can be realised by getting at least one project to financial close; 2. To develop the collective understanding of how to enable high-integrity projects to come to market, drawing on CAPE’s direct experiences and exchanging learnings with investors and other market actors; 3. To develop follow-on phases for CAPE, drawing on lessons from the pilot and raising finance for scale-up. FINANCIAL SECTOR DEEPENING AFRICA Africa Nature Investors Foundation LTD/GTE Vlinder Austria GmbH EDEN PEOPLE + PLANET Pro Green Earth Limited Stiftung Menschen für Menschen – Karlheinz Böhms Äthiopienhilfe goodcarbon Gmbh World Vision Australia AfriScout £1,275,000 funding is ringfenced for implementation in Africa and will be deployed in the following reporting period The Carbon Accelerator Programme for the Environment (‘CAPE’) seeks to address the challenges of investment flow into projects addressing both climate change and biodiversity loss, by accelerating high integrity natural climate solutions. 1530349.72 94076.72 161273 1000000 57000 69030 103563 56775.00 62152.5 57525.00 28188.75 200000 200000 30843 17850 37500.00