Nature-based solutions can help meet Canada’s 2030 climate and biodiversity targets but there are many gaps in research, implementing projects, measuring how well they work, and financing them.

Canada also needs a national framework for nature-based solutions with harmonized standards to ensure projects are similarly measured and accounted for wherever they are in the country, experts said in a webinar by the Canadian Science and Policy Centre.

“Nature-based solutions aren’t just nice to have. They’re a must-have strategy for meeting our biodiversity and climate commitments,” said Zahra Jandaghian (photo at right), research officer and nature-based solutions lead at National Research Council Canada (NRC).

“At NRC, we believe that nature-based solutions are truly becoming a cornerstone of how we move toward [Canada’s] 2030 biodiversity and climate targets,” she said.

Nature-based solutions (NbS) include restoration, conservation and management of wetlands, grasslands, peatlands, coastlines and forests, to mitigate and adapt to the effects of climate change while supporting biodiversity.

Examples include using wetlands to reduce flooding, restoring forests to absorb global warming-carbon dioxide, and creating green roofs and planting trees in cities to cool the air and buildings and manage stormwater.

A core principle is that NbS provide multiple benefits simultaneously, unlike traditional approaches or projects that often focus on a single issue. 

A 2023 Council of Canadian Academies (CCA) expert panel that looked at nature-based climate solutions found that forest protection and management, protecting grasslands and peatlands, and NbS related to agricultural practices have the highest potential to mitigate climate change and loss of biodiversity, said Kirsten Zickfeld (photo at left), distinguished professor of climate science at Simon Fraser University, who was a member of the CCA’s expert panel.

However, the effectiveness of NbS is affected by ecosystem responses to climate change, including the increasing number and severity of wildfires, and the intensity and frequency of droughts, she said.

“The CCA panel found that if nature-based solutions are implemented successfully in Canada, they can play a supporting role in meeting Canada’s climate targets. But they are not a silver bullet,” Zickfeld said.

The CCA panel found that NbS have the potential to reduce only about six percent of Canada’s greenhouse gas emissions [about 40 million tonnes of carbon dioxide equivalent], although the potential of NbS for carbon sequestration in Canada remains highly uncertain, she noted.

This means NbS “will need to be supplemented by stringent emissions reductions in other sectors. There’s no way we can leverage nature-based solutions to offset emissions from other sectors at the large scale.”

Zickfeld said her own research also found that nature-based solutions, such as converting agricultural areas to forests or projects that make snow-covered surfaces darker, change the way that energy is exchanged at Earth’s surface.

These biogeophysical effects can be substantial, to the point where they offset up to one-third or one-half of NbS’s benefit of sequestering carbon, such as in forests, she said.

On the other hand, Jandaghian from the NRC pointed out that NbS “are not just about the environment.”

“They’re about people,” she said, adding that NbS “create healthier, more livable communities.”

Major challenges exist for nature-based solutions

The experts pointed to some major challenges in implementing NbS, including:

• lack of national standards on how best to implement such solutions.
• no harmonized, pan-Canadian standards to measure, monitor and verify NbS’s long-term benefits.
• steep upfront costs of NbS projects.
• not enough pilot projects to prove the value of NbS.
• a $20-billion gap in financing NbS and uncertainty about the return on investment.

“The biggest barriers are how to scale up [NbS], how to reduce the upfront costs of nature-based solutions and how to come up with the monitoring system,” Jandaghian said.

“If we want nature-based solutions to scale and be trusted as part of climate and biodiversity strategy, then strong standards and monitoring frameworks are essential,” she said.

Work is underway to develop several national standards for NbS, said Stephanie Poirier (photo at right), senior policy analyst, climate change and sustainability standards, at the Standards Council of Canada.

These include standards on green roofs, watershed-based management of flooding and erosion, and coastal solutions (including best practices on design, construction, maintenance and monitoring), enhancing wetlands, as well as a guide on NbS in agriculture.

National standards can establish definitions and best practices for the design and implementation of NbS, Poirier said. “They are quite powerful tools and they can be used as part of requirements, as codes, regulations, bylaws and procurement requirements.”

However, developing such standards is a rigorous and accredited process that takes time and involves technical committees and public consultation. A national standard for enhancing wetlands, for example, isn’t expected for another couple of years.

There are existing international and other standards and frameworks for accounting measures that integrate the valuation of ecosystems, nature, biodiversity elements and natural assets, said Michael Twigg (photo at left), director of nature economics at the Smart Prosperity Institute.

The challenge “is how do we streamline those together to create a Canadian national standard so we all get on the same page,” he said.
Twigg pointed to the co-management of Thaidene Nëné National Park Reserve in the Northwest Territories as an example of a successful NbS.

The creation of the park reserve generated a significant trust find, with the federal government contributing $15 million that was matched by funds raised by the Łutsël K'e Dene First Nation in partnership with a conservation organization.

“What we’re seeing there are ecotourism guardian programs and cultural revitalization that comes with the funding that’s attached,” Twigg said.

Implementing NbS in this case involved a holistic approach to sustainably financing a locally derived and Indigenous-led solution, he added. “Governance and equity from an Indigenous perspective, Indigenous rights, Indigenous jurisdiction, is front and centre.”

NbS must consider the local priorities and objectives and include co-partnership when designing projects, programs and policies, all of which “leads to better conservation outcomes and practices across the board.” Twigg said.

“The focus should be on the [NbS] being a primary solution, not as an afterthought or as a way to deal with additional impacts of industrial-led development that causes negative outcomes,” he said.

Zickfeld noted that Simon Fraser University has an initiative called Community-centred Climate Innovation with several pillars, including:

• Interdisciplinary collaboration, including climate science, biodiversity and social sciences.
• Co-creation with community partners, including multiple community partners to work on projects involving transportation, buildings and coastal protect.
• Knowledge mobilization, to ensure that research results are made available to the wider community.

“The idea is to transcend academic research and really make sure that academic findings become available to the community,” Zickfeld said.

Ensuring nature-based solutions are effective

Jandaghian noted that in developing national frameworks and standards for nature-based solutions, there are some elements that are essential to get right, including:

• Clear environmental and performance metrics.

This includes quantifying ecological and climate benefits with consistent indicators and key performance metrics, such as temperature reduction, carbon sequestration, greenhouse gas reduction, biodiversity gains and improvements in air and water quality.

• Measuring and quantifying social and community wellbeing indicators.

“We should be tracking things like human comfort and health outcomes, equitable access in communities, even local job creation that’s tied to nature-based solutions’ design, construction and maintenance,” Jandaghian said.

• Determining the resilience and lifecycle of NbS.

 “Nature-based solutions shouldn’t deliver just on day one. It needs to deliver for decades,” she said. This  means monitoring and managing NbS over the long term, she said.

• Data collection and guidance for cities on how to assess trade-offs with NbS; for example how to maximize cooing without compromising water use or risking biodiversity.

Success for NbS is when it has measurable benefits across the triple bottom line of environmental gains, social wellbeing and economic stability, Jandaghian said.

Jandaghian said NbS enable to the National Research Council to simultaneously tackle multiple challenges, including climate change adaptation through diversity, community resilience, energy cost savings, reducing greenhouse gas emissions, and improving air quality, “all while putting nature at the centre.”

The NRC is leading several projects that directly support Canadian cities in implementing NbS, particularly in areas like coastal resilience, sustainable infrastructure, and climate change adaptation, including peatland restoration and sustainable forest management.

Integrating improved building envelope initiatives with NbS can reduce extreme heat in dense urban neighbourhoods and in buildings with vulnerable populations such as long-term care home facilities, social housing and primary schools, Jandaghian said.

“Through large-scale modelling and building simulations and real data collection, we are quantifying how these interventions lower temperatures, reduce cooling demands and improve comfort for residents,” she said.

The NRC is also exploring how green infrastructure, like constructed wetlands, can capture storm water, reduce flood risk and improve water quality while also creating habitats that support biodiversity.

In addition, the NRC is looking at green roof design, construction and maintenance, to retain water during storm events and help prevent flooding in dense urban areas.

“We’re working with municipalities and industry to ensure NbS are trusted in real-world settings, helping to bridge science, policy and practice,” Jandaghian said.

Closing the $20-billion financing gap for nature-based solutions

One of the biggest challenges for nature-based solutions is closing the $20-billion gap in financing needed for NbS projects.

The federal government in 2020 committed $3.9 billion, through its Nature Smart Climate Solutions Fund (administered by Environment and Climate Change Canada) over the next 10 years to nature-based climate solutions. However, the bulk of the funding – $3.19 billion – will go toward planting two billion trees.

The opportunities for nature-based remain emergent for the financial sector and few financial actors have developed NbS investment projects or strategies in the area, said Émilie Le Beuze (photo at right), senior advisor, engagement for sustainable finance & biodiversity, at Finance Montréal.

“I do think that adoption [of NbS] is progressing but it remains fragmented,” she said.

The financial sector is driven by a short-term vision [i.e. return on investment] whereas investment in NbS requires a long-term approach and a different way of looking at return on investment, she noted.

“There’s a difficulty in demonstrating the financial materiality of biodiversity,” [the monetary value of preserving biodiversity], Le Beuze said.

Proponents of NbS need to find ways to limit the risks for investors, especially long-term investors, she said.

Finance Montreal is a partner of Nature Investment Hub, a national platform addressing the $20-billion financing gap in NbS. The Hub is built around three strategic pillars: capacity building, thought leadership, and demonstration projects.

Le Beuze also pointed to the Raven Indigenous Outcomes Fund, an Indigenous-led fund manager using outcomes-based financing to support relevant and measurable solutions.

Finance Montreal also collaborated last winter with the Centre de recherche appliquée sur la biodiversité et les écosystèmes (CRABE) on a cross-sectoral initiative on biodiversity issues. CRABE aims to develop and deploy scientific knowledge to achieve national and international conservation targets and improve territory management in Quebec.

“Based on the research work, we need to shift to a common narrative” Le Beuze said. “We need to position NbS not as an isolated environmental project but as strategic levers for economic resilience, climate change adaptation and economical and social wellbeing.”

“Having a shared vision will help a lot to align priorities across sectors and unlock bolder engagement,” she added.

To address the perceived financial risks of NbS, proponents need to invest in capacity-building, including targeting training to communities of practice and doing demonstration projects that prove the economic and ecological co-viability of NbS, Le Beuze said.

“We also need structural, intersectoral collaboration, including [with] Indigenous leadership,” she said.

Also required are more diverse financial tools that include financial mechanisms for biodiversity and the carbon credit market, more blended finance and other tools, Le Beuze said.

Twigg said a big challenge for nature-based solutions in terms of strategic and long-term planning is “future forecasting” the long-term benefits of NbS projects.

When it comes to depreciation of value, risk reduction and return on investment, these components are easier to measure and account for with typical standard non-nature-based infrastructure, he said.

There is no national standard to account for these components with different types of NbS, so they “end up being a per-project design and it doesn’t always come through that this is a benefit moving forward,” Twigg said.

The perspective on NbS needs to be shifted away from “the simple argument around dollars and cents,” he said.

Instead, he said, proponents need to underscore that they’re looking to create better and more resilient communities, and link the way the biophysical world interacts with economic systems, investment risks and human health outcomes.

Doing so will require more pilot projects, more testing and more data collection over a longer term, Twigg noted.  

Incentives to attract financing and investment could be encouraged by setting the stage with “clear public policies that biodiversity and NbS are not just a ‘nice to have’ anymore,” Twigg said. “They really are something that drives that triple bottom line for what the future of Canada’s economy is going to look like.”

Canada has a wealth of natural heritage, natural resources and nature-based resources, he said. But these resources aren’t infinite and their future depends on well Canadians protect and manage them.

“I think there’s a strong incentive that can be made at the public policy level that can unlick innovation [for NbS] across the across the private sector [and] across academia,” Twigg said.

Jandaghian agreed that “we need strong policy signals. We need to have nature-based solutions in building codes, in climate adaptation plans, in infrastructure funding.”

If NbS are recognized as legitimate, cost-effective infrastructure, then municipalities would feel more confident in investing in them, she said. “We need to connect nature-based solutions to risk reduction and long-term value.”

When people see the improvements in community health, energy cost savings, air and water quality, in everyday life and wellbeing, then NbS adoption will accelerate naturally, Jandaghian said.

“Sometimes the most powerful change starts small. Change begins with us: one tree, one plant, one action at a time,” she said. “And together we can grow a truly sustainable future with nature-based solutions.”

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