Delivering Innovative Markets for Ecosystems (DIME)

The £99,985 DIME project is being led by Foundation in partnership with Nature Finance and the Rivers Trust with their financial and commercial advisory skills. The project is setting up a natural capital trading “Special Purposes Vehicle” (SPV), using the portfolio of evidence and engagement provided by the Foundation and farmers. Once established, the SPV and ecosystem service contract structures, as the culmination of a legal and evidence-based framework development process, can be rolled out across the whole of the Wye and the Usk catchments. It will be a powerful tool for the delivery of the Wye Nutrient Management Plan and the Wye Catchment Partnership’s efforts to correct the problems on the Wye. The knowledge acquired from the DIME project and the other three catchment-based pilot projects is being shared across the river trust network and wider to support the transition into larger scale environmental projects. The nature-based investment approach is strongly supported by Government policy through the 25 Year Plan, Environment Bill and other initiatives such as the UK’s new carbon Emissions Trading Platform. The project is working on the English headwaters of the river Monnow, namely the sub catchments of the Dulas, Dore and Worm. The total project area is 123km2 of which we have engaged landholdings totalling 98km2.  

The Problem

The Monnow catchment suffers from significant flooding and water quality issues which impact adversely on local communities, businesses and future development. The catchment has been subject to an increasing frequency of damaging floods in recent years with property and infrastructure being inundated on 26/10/19, 08/02/20, 16/02/20, 19/12/20, 8/02/21 and 20/02/2021. The return period has changed from 8 years to < 6months as late winter soil compaction and panning has exacerbated the effect of intense rainfall in the late winter. The large village of Ewyas Harold is particularly at risk of flooding, located close to the Dulas Brook, and having most recently severely flooded following Storm Dennis in February 2020. In terms of overall flood risk profile, 21 properties in Ewyas Harold are at risk of flooding in a “1 in 100”-year flood event (1% probability in any one year). Furthermore, crucial infrastructure including the A465 between Pontrilas and Ewyas Harold and the main train line between Abergavenny and Hereford are at risk of flooding during large storm events, most recently submerged by Storm Dennis floodwater in February 2020. The devastating impacts of flood events have severe social and economic costs to local authorities, businesses and affected communities.  

The Solution

After modelling how floods are generated and how much each tributaries discharge contributes to the flood peak we are working with the farmers to assess soil condition, overland flow lines and identify opportunities within the project area for investors to invest with evidential, legal and financial certainty to provide improved regulatory and provisioning ecosystem services. Investors affected by similar issues will be able to join together in certainty and so reduce individual costs.