Handbook For The Implementation Of Nature-based Solutions For Water Security: Guidelines For Designing An Implementation And Financing

Description

Plans and projects reach the front of the funding queue only when the case for investment has been made — and for a Nature Based Solution that case has to cover the strategic, economic, commercial, financial and management dimensions at once. The Handbook is the working manual for doing that: a set of guidelines, an auto-diagnostic questionnaire and a format for each module, from which a full business case and an implementation arrangement can be assembled.

Its central proposal is that hybrid infrastructure clusters be defined first and contracts written afterwards. Measures are grouped into clusters that serve several purposes, the clusters are organised into hybrid and multipurpose projects, and those are then let under performance-based contracts funded from several revenue streams — depending on local institutional conditions and on how much the beneficiaries are willing to pay.

The approach has been applied continuously since 2016, within NAIAD at the Duero basin, the Danube flood and drought risk management plan and the Rotterdam urban microwetlands, and outside Europe in Indonesia, the Philippines, Mexico and Ecuador.

Applications to decision making in the insurance sector

The Handbook defines the point at which a risk carrier can be brought into an arrangement — as a partner in a public-private structure, as a source of risk data, or as a co-investor whose return is the reduction of future claims. It also addresses the procurement and contracting practices that have to change before such arrangements are possible at all.

Added value of this modelling approach

It converts an advocacy position into an investable proposition. NBS proponents are often scientific or advocacy organisations with little exposure to investment planning; the modules give them the formats investors ask for, and the diagnostic tells them which part of the case is weakest before they present it.

What decision can be improved with this modelling approach

How to structure a project so that it can be financed; which delivery and finance option to choose given the local institutional setting; how to phase a strategy so that it can be absorbed by an investment programme; and how to write the contract when several authorities and several revenue streams are involved.