Brussels, 12 May 2023
Interinstitutional files:
2022/0195 (COD)
WK 6315/2023 INIT
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ENV
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MEETING DOCUMENT
From:
General Secretariat of the Council
To:
Working Party on the Environment
N° Cion doc.:
10607/22 + ADD 1
Subject:
Nature Restoration Regulation: WPE on 16 May 2023 – Non-Paper from the
Commission on Financing for nature restoration
With a view to the WPE meeting on 16 May 2023, delegations will find attached a Non-Paper by the
Commission on Financing for Nature Restoration to support follow-up discussions from the Workshop
held on 27 April 2023.
WK 6315/2023 INIT
LIMITE
EN

Non-paper from the Commission services
Nature Restoration Law

Disclaimer:  This document is meant purely as an explanatory note on the Commission proposal on
Nature Restoration - COM(2022) 304 final - to help legislative deliberations. This document has no
legal standing and must not be considered under any circumstances as a legislative proposal. It cannot
be interpreted as an official Commission document, or as one amending in any way the Commission’s
proposal.
PURPOSE: This document informs on EU funding opportunities that may be available for restoration
measures under the proposed Nature Restoration Law (NRL).
1.  Funding needs and opportunities for nature restoration
Under the NRL proposal, Member States are required to estimate in their national restoration plans the
financing needs for implementing restoration measures. This shall include a description of the support
to  stakeholders  affected  by  restoration  measures  and  the  means  of  intended  financing,  public  or
private, including co-financing with Union funding instruments.

The impact assessment underpinning the NRL proposal estimated the total financing needs for nature
restoration in the EU at EUR 6 to 8 billion per year1. It is important to note that the economic benefits
of nature restoration far outweigh its costs. Every euro invested in nature restoration is estimated to
result in at least 8 euro in benefits.

Various  EU  funds  provide  funding  opportunities  for  nature  restoration  under  the  2021-2027
Multiannual  Financial  Framework  (MFF).  These  include  the  funds  under  the  Common  Agricultural
Policy  (CAP),  the  Cohesion  Policy  funds,  the  European  Maritime  Fisheries  and  Aquaculture  Fund
(EMFAF), the Programme for the environment and climate action (LIFE), Horizon Europe, InvestEU,
the Recovery and Resilience Facility (RRF), as well as technical support and assistance tools such as
the Technical Support Instrument (TSI) and the EIR Peer2Peer tool, which are further detailed below.

The MFF Interinstitutional Agreement2 sets out that the EU will allocate at least 10% of the MFF to
biodiversity in 2026 and 2027 (and 7,5% in 2024). This corresponds to ca. EUR 16 billion per year on
average3 dedicated to biodiversity overall, including for nature restoration actions.

Other sources of funding are also expected to contribute to the implementation of the NRL:
•  Over the period 2021-2030, Member States’ national budgets (EU27) are estimated to allocate
ca. EUR 14 billion per year to biodiversity, including nature restoration.
•  Financing  is  also  expected  from  the  private  sector  including  businesses,  banks,  financial
institutions, philanthropy, and NGOs.

The EU and its Member States have committed to significantly increase biodiversity finance under the
Kunming–Montreal  Global  Biodiversity  Framework  (GBF).  Target  19  of  the  GBF  aims  to  increase

1
Impact Assessment accompanying the NRL proposal (Part 1), page 102.
2
Interinstitutional  Agreement  of  16  December  2020  between  the  European  Parliament,  the  Council  of  the  European
Union  and  the  European  Commission  on  budgetary  discipline,  on  cooperation  in  budgetary  matters  and  on  sound
financial  management,  as  well  as  on  new  own  resources,  including  a  roadmap  towards  the  introduction  of  new  own
resources, Official Journal of the European Union, LI 433/28
3
Annual EU Budget 2023 (europa.eu), European Commission.
1

global biodiversity financing from all sources from about USD 100 billion per year to at least USD
200  billion  per  year  by  2030.  This  commitment  is  expected  to  contribute  to  the  mobilisation  of
financing for nature restoration in the EU.
Under the NRL proposal, Member States must submit a draft national restoration plan within 2 years
from  the  date  of  entry  into  force  of  the  Regulation.  This  means  that  the  national  restoration  plans
would  likely  start  to  be  implemented  towards  the  end  of  the  2021-2027  programming  period.  To
support  this  implementation,  Member  States  may  decide  to  either  rely  on  interventions  already
planned in their CAP Strategic Plans and other programmes (e.g. under Cohesion Policy funds), or to
amend them, as they consider appropriate. As regards the architecture of the next programming period
(post-2027), the Commission is expected to present a proposal by mid-20254.

2.  EU funding instruments relevant for NRL
Common Agricultural Policy (CAP)
The  CAP  2023-2027  supports  interventions  to  fulfil  nine  specific  objectives,  among  which  to
'contribute  to  the  protection  of  biodiversity,  enhance  ecosystem  services  and  preserve  habitats  and
landscapes'.  Member  States  have  prepared  national  CAP  strategic  plans  in  which  interventions  are
planned to address the needs set out in these plans and contribute to the CAP specific objectives.
In  their  planning,  Member  States  need  to  respect  certain  minimum  allocations  for  environmental
objectives. Member States reserved at least 25% of the direct payments allocations for eco-schemes
aiming to protect the environment and climate, and at least 35% of their rural development spending
for  environmental,  climate  and  animal  welfare  interventions.  As  part  of  rural  development,  agri-
environmental payments are an obligatory intervention included in each CAP plan, and traditionally
one of the most important area-related measures under rural development targeting the environment.
Examples of CAP interventions contributing to meeting the objectives of NRL are:
-  under eco-schemes or environmental/climate management commitments, support to restoring
wetland  and  peatland,  a  minimum  water  table  level  during  winter,  or  the  application  of
rewetting techniques;
-  under  eco-schemes  and  environmental/climate  management  commitments,  support  to  soil-
friendly practices, such as measures to increase the level of organic matter in the soil, direct
sowing or conservation agriculture methods, the setting of transversal ditches in sloping areas,
no-tillage and direct sowing, other types of tillage to limit soil erosion, and promoting the use
of enhanced intercropping practices for the protection of soils.
All these practices are in line with the restoration measures listed in Annex VII of the NRL proposal.
Moreover, European farmers receiving direct payments or some of the rural development support must
respect the Good Agricultural and Environmental Conditions (GAECs)5. GAECs include requirements
on wetlands and peatlands and on soil, as well as on biodiversity:
-  GAEC 2 requires the ‘protection of wetland and peatland’ and Member States have defined in
their  CAP  plans  the  relevant  protection  requirements  (such  as  a  ban  on  the  conversion  of
wetland and peatland, a ban on the drainage or the burning and extraction of peatland).

4   Article 21 of Council Regulation (EU, Euratom) 2020/2093 laying down the multiannual financial framework for the
years 2021 to 2027.
5
Laid down in Article 13 and Annex III of Regulation (EU) 2021/2115 of the European Parliament and of the Council of
2 December 2021 establishing rules on support for strategic plans to be drawn up by Member States under the common
agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the
European Agricultural Fund for Rural Development (EAFRD) and repealing Regulations (EU) No 1305/2013 and (EU)
No 1307/2013.
2

-  To  improve  soil  condition,  GAEC  3  bans  arable  stubble  burning  to  maintain  soil  organic
matter.
-  In their CAP plans, Member States have defined the appropriate tillage management options
to limit soil erosion (under GAEC 5), requirement for minimum soil cover to avoid bare soil
in most sensitive periods (under GAEC 6) and practices for crop rotation in arable land (under
GAEC 7).
-  GAEC  8  has  as  main  objective  the  maintenance  of  non-productive  features  and  area  to
improve on-farm biodiversity. It prescribes a ‘minimum share of 4%6 of arable land devoted
to non-productive areas or features7’ and the ‘retention of landscape features’ based on a list
defined by Member States.
-  To  protect  habitats  and  species,  GAEC  9  ensures  that  permanent  grassland  in  Natura  2000
sites designated as environmentally sensitive are not converted or ploughed.
These  requirements  imposed  on  farmers  to  obtain  income  support  will  contribute  to  achieving  the
NRL objectives and targets.

Cohesion Policy Funds
Cohesion  Policy  is  the  EU’s  main  investment  policy.  Significant  funding  is  available  for  nature
restoration  under  Cohesion  Policy  funds,  in  particular  under  the  European  Regional  Development
Fund (ERDF) and the Cohesion Fund (CF). Under Policy Objective 2 (Greener Europe), a dedicated
specific  objective  for  the  ERDF  and  CF  is  about  ‘enhancing  protection  and  preservation  of  nature,
biodiversity and green infrastructure, including in urban areas, and reducing all forms of  pollution’.
Member  States  must  dedicate  at  least  30%  of  their  ERDF  budget  to  investments  under  Policy
Objective 2.
The Cohesion Policy funds have a wide range of eligible interventions that includes:
-  restoring  natural  ecosystems  (including  forests,  wetlands,  peatlands,  freshwater,  coastal  and
marine ecosystems)
-  restoring urban and peri-urban ecosystems including by planting trees and promoting nature-
based solutions for reducing air and noise pollution, reducing energy consumption, mitigation
and adaptation to climate change and combatting the effects of heat waves
-  restoring and remediating contaminated sites through ecosystem restoration
-  eco-tourism linked to protected areas
-  integrating  green  infrastructure  in  ‘grey’  infrastructure  such  as  buildings,  railways,  energy
transmission lines, etc.
-  environmental education, training, capacity building, awareness raising.
For 2021-2027, Member States have programmed EUR 16.6 billion of expenditures from ERDF and
CF directly benefitting biodiversity and nature restoration.

LIFE Programme
The  LIFE  Programme  is  the  EU’s  funding  instrument  for  the  environment  and  climate  action.  It  is
implemented via four sub-programmes. The budget for the “Nature and biodiversity” sub-programme,
which can finance nature restoration measures, is EUR 2.1 billion for 2021-2027.
The  LIFE  Programme’s  2023  Calls  for  project  proposals  will  close  on  6  September  2023.
EUR 148 million will be dedicated to Standard Action Projects (SAPs) on nature and biodiversity.

6   The  mandatory  4%  may  be  decreased  to  3%  provided  farmers  subscribe  to  more  ambitious  voluntary  commitments
under eco-schemes (at least 7% on landscape features on the farm) or if at least 7% of arable land at farm level includes
also catch crops or nitrogen fixing crops cultivated without the use of plant protection products.
7
This includes also land lying fallow. Two other options may also be retained by Member States.
3

Horizon Europe
Horizon Europe is the EU’s key funding programme for research and innovation (R&I) for 2021-2027
with a budget of EUR 95.5 billion. The aim of the programme is to strengthen the EU’s scientific and
technological basis, including by developing solutions to address Green Deal policy priorities, mainly
addressed  under  the  cluster  ‘Food,  Bioeconomy,  Natural  Resources,  Agriculture  and  Environment’.
This  cluster  aims  inter  alia  to  reduce  environmental  degradation,  halt  and  reverse  the  decline  of
biodiversity  on  land,  inland  waters  and  at  sea,  and  better  manage  natural  resources  through
transformative changes of the economy and society. From 2021 to 2024, the cluster has funded or will
fund  projects  developing  solutions  to  protect  and  restore  biodiversity  and  ecosystems  and  at
mainstreaming biodiversity in society and the economy. Under the work programme 2023-2024, EUR
266 million are available under calls for proposals. The current call will close in September 2023 and
the next call will open in October 2023. In addition, co-funded partnerships under this cluster (notably
Biodiversa+ and Water4All) and Horizon Europe missions ‘Restore our ocean and waters’ and ‘A soil
deal  for  Europe’  offer  opportunities  for  research  on  biodiversity  and  ecosystem  restoration  in  their
own calls.

European Maritime, Fisheries and Aquaculture Fund (EMFAF)
The  EMFAF  is  strongly  connected  to  the  objectives  of  the  EU  Biodiversity  Strategy  for  2030,
including marine and coastal ecosystems restoration. Of the total budget of EUR 5.3 billion over 2021-
2027,  28%  (EUR  1.5  billion)  is  programmed  for  biodiversity-related  projects,  including  ecosystem
restoration. This percentage is an EU average and varies amongst Member States from 56% down to
14%.
Examples of eligible actions under Article 25 of the EMFAF Regulation8:
-  Support for sustainable, low-impact and low-carbon fishing activities
-  Protection and restoration of marine biodiversity and ecosystems
-  Creation and management of marine protected areas
-  Implementation of the spatial protection measures established pursuant to the Marine Strategy
Framework Directive
-  Protection of species in accordance with the Habitats Directive
-  Collection of lost fishing gear and marine litter from the sea
The  eligibility  rules  are  not  pre-defined  at  EU  level  and  the  Commission  encourages  the  Member
States to use the available financing opportunities for the restoration of marine and coastal ecosystems.

InvestEU Fund
The InvestEU Programme supports sustainable investment, innovation and job creation in Europe and
consists of three building blocks. The InvestEU Fund aims to mobilise over EUR 372 billion of public
and private investment in 2021-2027 through an EU budget guarantee of EUR 26 billion that backs the
investment  of  implementing  partners.  The  InvestEU  Advisory  Hub  provides  technical  support  and
assistance  including  capacity  building  to  project  developers  and  entities,  and  the  InvestEU  Portal
brings together investors and project promoters on a single EU-wide platform.
At  least  30%  of  the  InvestEU  Programme,  in  line  with  the  European  Green  Deal  objectives,  shall
support financing for investments that contribute to the EU’s climate objectives. Moreover, 60% of the
investments  supported  under  the  “Sustainable  Infrastructure  Window”  of  the  InvestEU  Fund  shall
contribute to the EU’s climate and environmental objectives.

8
Regulation (EU) 2021/1139 of the European Parliament  and of the Council of 7 July 2021 establishing the European
Maritime, Fisheries and Aquaculture Fund and amending Regulation (EU) 2017/1004.
4

InvestEU is implemented through Implementing Partners (international financing institutions such as
EIB,  EIF,  EBRD,  and  national  promotional  banks).  Each  implementing  partner  designs  financial
products for which the underlying investments will be covered by the InvestEU guarantee. Some of
those products include nature and biodiversity (including nature restoration) as eligible investments.
Nevertheless, InvestEU is a demand driven instrument, and the first indications  are that there is not
much uptake for nature and biodiversity.  To increase an uptake of biodiversity by the EIB Group, a
Commission-EIB Group working group has been established.

Recovery and Resilience Facility (RRF)
The RRF aims both to mitigate the economic and social impact of the coronavirus pandemic and make
European  economies  and societies more  sustainable,  resilient  and better  prepared  for the challenges
and  opportunities  of  the  green  and  digital  transitions.  Up  to  EUR  723.8  billion  has  been  made
available under the Facility. Under the RRF pillar ‘green transition’, EUR 6.9 billion is available for
the  protection  and  restoration  of  biodiversity  and  ecosystems  in  the  Member  States’  Recovery  and
Resilience Plans. However, this amount is unevenly spread as there is no or limited in several Member
States.
Biodiversity and nature measures planned by Member States, include, for example:
-  conserving terrestrial and marine biodiversity, restoring ecosystems, green infrastructure and
ecological connectivity based on nature-based solutions, fighting invasive alien species
-  upgrading  and  modernising  ‘biodiversity  infrastructure’  for  example,  the  restoration  of
terraces related to biodiversity protection
-  establishing a National Biodiversity Fund that will, among others, implement projects aimed
at restoring degraded ecosystems
-  supporting national parks and addressing ecological defragmentation
-  establishing a reference framework for municipalities, including a certification and financial
grants, to facilitate nature conservation
-  restoring  and  protecting  the  seabed  and  marine  habitats  to  reverse  ongoing  degradation  of
these ecosystems, including, the development of an adequate mapping of seafloor habitats and
environmental monitoring
-  restoring  rivers,  floodplains  and  lakes,  while  eliminating  invasive  alien  species  in  sensitive
areas
-  rehabilitating  peatlands  with  an  aim  to  change  land  use  from  peat  extraction  to  carbon
sequestration; contribute to increased biodiversity; support bog amenity and eco-systems; and
improve water quality and flood risk management.

3.  Technical support and assistance tools
Several  tools  have  been  developed  to  support  Member  States  in  mobilising  more  financing  for
biodiversity, including nature restoration:

Technical Support Instrument
The Technical Support Instrument provides tailor-made technical  expertise to EU Member States to
design and implement reforms.  There is EUR 864 million for the 2021-2027 period and there is no
need for co-financing.

The 2023 Flagship for Climate Adaptation provides technical assistance on request by Member States
for the update and improvement of climate adaptation strategies, policy frameworks and governance
structures, at both regional and national level. Among the five technical support packages that Member
States and regions can choose, one key building block relates to the implementation of nature-based
solutions for climate adaptation such as to:
5

-  Implement and scale up nature-based solutions, including the implementation of ecosystem-based
disaster risk reduction approaches;
-  Assess barriers and enablers for implementation of nature-based solutions;
-  Assess  the  vulnerability  of  ecosystems  to  climate  change,  perform  ecological  assessments,  and
integrate climate pressures in the Mapping and Assessment of Ecosystem Services (MAES);
-  Support  the  biophysical  and  economic  assessment  of  forest  and  water  ecosystem  services  to
support informed decisions for policy makers and ecosystem managers.
New 2024 Flagships will be available  under the  2024 Technical Support Instrument cycle. Member
States will be invited to send their requests before 31 October 2023.
In addition, Member States willing to advance together biodiversity-related financing and governance
in light of the goals and targets of Global Biodiversity Framework (GBF) may consider joining under
a multi-country request to the Commission (DG REFORM) to address the following reform needs:
-  preparing or contributing to the development of national restoration plans
-  developing nature-positive financing frameworks (contributing to Target 19 under the GBF)
-  phasing-out of environmentally harmful subsidies (contributing to Target 18 under the GBF)
-  mainstreaming biodiversity objectives in private sector financing (contributing to Target 15 under
the GBF).

Green Assist
Green  Assist  is  an  advisory  initiative  supported  through  the  LIFE  Programme.  It  aims  to  increase
environmental  uptake  under  the  InvestEU  programme  (see  above)  by  building  a  pipeline  for  green
investment projects, including for nature restoration. In addition to Green Assist, a Commission - EIB
Group working group has been set up to increase EIB Group uptake for biodiversity and nature under
InvestEU and other funding instruments, such as the ERDF+.

Cohesion for Transitions (C4T)
Support is also available for Member States and regions for the effective implementation of Cohesion
Policy funds, in the form of technical assistance, through the initiative Cohesion for Transitions (C4T).
It has a dedicated working group on environmental issues and a tailor-made technical assistance tool,
the ‘C4T Groundwork’, providing targeted individual support to a Member State or region. Calls for
expression  of  interest  for  C4T  Groundwork  will  be  issued  in  2023  for  targeted  support  on  Policy
Objective 2 topics, including nature restoration.

Technical Assistance and Information Exchange (TAIEX-EIR Peer to Peer)
TAIEX-Environmental Implementation Review (EIR) Peer to Peer is an EU technical assistance and
policy  support  instrument  designed  to  promote  quality  implementation  of  EU  environmental  policy
and legislation in the Member States. It supports sharing best practices among Member States’ public
administrations  across  the  EU.  TAIEX-EIR  P2P  covers  all  policy  areas  connected  with  the
Environmental  Implementation  Review  reports  published  every  two  years  for  all  Member  States.
These reports include, inter alia, chapters on nature protection and biodiversity, the bioeconomy, green
infrastructure and soil protection, sustainable urban development and sustainable finance, all of which
may have links with  nature restoration efforts. The  P2P instrument can also provide support for the
implementation  of  a  specific  EU  funding  programme.  Support  is  provided  on  demand  by  Member
States,  through  workshops,  expert  missions  and  study  visits.  Beneficiary  authorities  can  also  obtain
specific expertise provided by officially recognised TAIEX experts.

6

4.  Upcoming opportunities

EU Emissions Trading System (ETS)
The ETS has been in place since 2005 and has enabled the EU to reduce its CO2 emissions by 34,6%.
In  2022  alone,  Member  States received  EUR  29.7  billion  in  auction  revenues, from  a total  of  EUR
38.7 billion.
The ETS Directive is currently under revision, including new rules on Member States’ use of auction
revenues.  In  particular,  the  proposed  revised  list  of  ‘climate  purposes’  includes  ‘measures  to  avoid
deforestation and support the protection and restoration of peatland, forests and other land or marine-
based  ecosystems,  including  measures  that  contribute  to  the  protection,  restoration  and  better
management thereof, in particular as regards marine-protected areas, and increase biodiversity-friendly
afforestation  and  reforestation,  including  in  developing  countries  that  have  ratified  the  international
agreement on climate change, and measures to transfer technologies and to facilitate adaptation to the
adverse effects  of  climate change  in those  countries’.  The  revised  ETS  Directive  proposal  also lists
other purposes relating to ‘forestry and soil sequestration’ and ‘just transition’, potentially relevant for
nature restoration.
The  EU  ETS  is  also  providing  the  revenues  for  the  Innovation  Fund,  which  is  one  of  the  world’s
largest  funding  programmes  for  the  demonstration  of  innovative  low-carbon  technologies.  The
Innovation Fund allows for funding activities linked to biodiversity and nature restoration.
These new funding opportunities under the proposed ETS revision are expected to provide significant
funding sources for ecosystem restoration.

Carbon removals
The  first  EU  certification  framework  of  carbon  removals  was  proposed  by  the  Commission  on  30
November 2022. It aims to provide an important instrument in support of achieving the EU’s goal to
become the world’s first climate-neutral continent by 20509. This framework aims to encourage more
businesses, land managers, and other stakeholders to contribute to carbon sequestration, and to allow
them to generate further income by being part of a harmonised and reliable certification framework.

5.  Information sources on financing

The Vademecum ‘Find your EU funding programme for the environment’ under the 2021-2027
MFF is a practical and user-friendly guide on where and how to access EU funding for environmental
projects, including nature restoration. It also presents the related budget available to Member States to
organise on-demand online conferences until December 2023 with a view to engaging stakeholders,
supporting  access  to  funding  and  increasing  the  understanding  of  project  promoters  (private  and
public), national authorities and interested parties.
The Natura 2000 financing handbook analyses and describes opportunities for financing investments
in Natura 2000 in the 2021-2027 MFF. It explains funding opportunities from EU funds and provides
practical advice on how to incorporate them into national and regional programmes.

9
European Commission, Directorate-General for Climate Action, Wiltshire, J., Keesje, A., Gill, D., Guidance to Member
States in improving the contribution of land-use, forestry and agriculture to enhance climate, energy and environment
ambition, Publications Office of the European Union, 2023, https://data.europa.eu/doi/10.2834/19417.
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