Scaling up Nature-based Solutions to Tackle Water-related Climate Risks

Executive summary

As countries continue to accelerate efforts to mitigate the effects of global warming, adaptation actions remain indispensable to protect communities from the detrimental impacts of climate variability and change. While “grey” engineering solutions, such as dykes or levees, have been the most widely used measures to adapt to and reduce climate risks in the past, nature – and its ecosystem services – has increasingly come to the fore as an effective alternative or complementary solution.

While it takes more time for the full benefits of nature-based solutions (NbS) to be reaped, they have been recognised for the multiple societal challenges they can help to address and the co-benefits they offer. Riverbed or wetland restoration can reduce flood risk and contribute to enhancing biodiversity, while providing sinks for carbon emissions. Their cost efficiency, adaptability to changing environmental conditions (including climate), as well as the multiple co-benefits for human health and well‑being have further added to their attractiveness.

In recognition of the effectiveness of NbS in addressing climate risks, a number of international efforts have promoted their use, including the Paris Agreement, the United Nations Convention for Biological Diversity and the Sendai Framework for Disaster Risk Reduction.

For countries to fully exploit the potential of NbS, more knowledge is needed on how to overcome some of the recognised challenges. NbS remain implemented on relatively small scales, and on an ad hoc basis. A lack of awareness and gaps in technical capacity have hindered application at a larger scale. However, major obstacles persist especially in demonstrating (i.e. quantifying) NbS’ benefits and performance over time, without which they tend to be outperformed by other solutions.

This report provides insights into country-level efforts, namely from Mexico and the United Kingdom, on how to level the playing field for NbS in the area of water-related climate risks. It structures the discussion around the five dimensions (governance, policies, regulations, technical capacity and finance) that have been identified in previous OECD work as key enabling factors to be considered to scale up the use of NbS.

Key findings and recommendations

Formulating policy targets for NbS can be an effective way to strengthen current policy support

NbS are well-recognised priorities in national climate and biodiversity policies. While their integration into overarching national policies is essential, it is important that sectoral policies (infrastructure, agriculture, water, etc.) include NbS too, as they will ultimately drive their implementation. Considering the trade-offs between NbS and other sectoral policy objectives is important to ensure mutually reinforcing efforts. Finally, the formulation and monitoring of policy targets will be important to strengthen policy effectiveness.

NbS need to be promoted by and co-ordinated among a wide range of actors

Many actors are involved in planning and implementing NbS, including national flood and drought management agencies, public works or infrastructure agencies, infrastructure operators, and regional and local authorities. Other non-governmental actors also play an important role in their uptake. This means that a cross-sectoral and cross-governmental approach is needed. Facilitating collaboration between multiple actors can improve coherence, help create synergies and avoid trade-offs between different policy objectives. Collaboration can also be a starting point to increase ownership and accountability for NbS.

Regulation can unleash considerable opportunities for NbS

Spatial planning determines how housing and infrastructure development and land preservation are envisaged, and hence the role NbS can, and has to, play in that. Given the important role of local governments in spatial planning, countries have issued national guidance and developed tools to help promote the integration of NbS into land-use plans.

Another key regulatory lever that can foster the use of NbS is building codes. More and more countries are working to integrate NbS into building codes, such as requiring a minimum for green space areas on and around new buildings and permeable material in driveways to increase water absorption and retention capacities.

Public procurement is another key regulatory instrument that can determine which specific construction materials or plant species are to be integrated into investments that reduce climate risks. One challenge country practitioners seem to face is the difficulty of demonstrating the full range of the costs and benefits of NbS, which makes it difficult for procurement agencies to follow value-for-money principles.

Information is key to identifying opportunities and triggering action for NbS

To give NbS equal consideration as other solutions, more information is needed about their performance throughout a project’s life cycle, considering their maintenance needs and requirements as well as their effectiveness over time when they are applied at a larger scale. There is also a need for this information regarding hybrid solutions (i.e. NbS implemented as a complement to grey infrastructure). Uncertainty around NbS’ performance may in turn favour traditionally engineered solutions.

Compiling and communicating increasingly available information on good practices and performance data of NbS, through repositories, guidelines or other design tools, can significantly support the scale at which NbS are used and considered as part of decision-making processes.

NbS face a scattered funding landscape

NbS interventions have distinctive financing needs and standard financing models are not easily adaptable. Until now, NbS have primarily relied on public funding, especially when used as measures to attenuate climate risks for larger areas or communities, i.e. those that have strong public good characteristics.

Funds exclusively dedicated to NbS might exist at the international level (such as dedicated EU funds or funds mobilised through the Global Environment Facility), but the national funding landscape for NbS is usually much more scattered. NbS are supported by environmental protection, climate change or disaster risk reduction funds. Some funds are only gradually making NbS explicitly eligible for funding. However, while NbS may be eligible for certain funds, the difficulty in demonstrating cost effectiveness, and the comparatively high transaction costs, remain an obstacle to obtaining and securing funding over time.