One of the main challenges when planning and implementing NbS is to be able to weigh the costs of the solutions against their benefits. Cost-benefit analyses are traditionally focused on one single, or a few selected issues, and do not always include impacts on nature or the ecosystem services provided by nature. This makes it difficult to assess the costs and benefits of NbS in comparison to more traditional, technical, or “grey” solutions.
The lack of information and uncertainty about the costs and benefits of NbS makes it difficult to calculate reliable revenue streams and to develop investment plans for NbS. To help to address this issue, the following recommendations were made by the S-ITUATION project following workshops with Nordic stakeholders in 2021:
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The strength of NbS is that they can address multiple societal problems at the same time, but this is not reflected in most current cost-benefit analyses. To account for the benefits of NbS, there is a pressing need for proper monetary valuation studies focusing on the ecosystem services of different NBS to allow for value transfers from one study area to other locations and cases.
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Current cost-benefit analyses of NbS often do not properly consider the long-term benefits of NbS. This is because these benefits could increase over time, depending on how they were built/secured and maintained. This leads to the impression that NbS are more expensive compared to traditional or “grey” solutions, even when they are not. Comprehensive cost-benefit analysis can help potential investors choose NbS over other more technical solutions.
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Current thinking is often focused on single ecosystem service delivery – for example water companies focus on delivering drinking water and cleaning wastewater using traditional infrastructure, thus missing the additional services NbS could provide. In order to direct existing funding to test and create NbS , including ecosystem service delivery, it is necessary with creative, proactive, and holistic thinking.
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There is a lack of coordinated public and private funding for NbS. The many benefits that NbS can deliver for different societal needs should also be reflected in the funding the solutions receive. Incentive systems may help to attract private investors, coordinate public funding, and mainstream NbS.
The A-DVICE handbook focuses on the different kinds of policies, such as strategies, incentive programs and laws that may be useful when planning NbS in the Nordic region. In that handbook, you can read more about the financing of NbS, and get advice on cost-benefit analyses in Nordic NbS projects.