Nature Smart Climate Solutions Fund

Overview

Conserving and restoring nature is fundamental to mitigating and adapting to climate change.

The climate and nature crises are inextricably linked. Climate change is altering the water cycle, resulting in flooding, droughts, and wildfires. It is one of the key drivers of biodiversity loss, which is proceeding at an unprecedented rate. Up to one million species are currently at risk of extinction. At the same time, degrading and destroying ecosystems worsens climate change by releasing the carbon dioxide they store into the atmosphere.

Nature-based climate solutions (or natural climate solutions) will help Canada meet its 2030 and 2050 climate change mitigation objectives by reducing emissions from land management and strengthening resilience to climate change.

Nature-based solutions include actions to reduce the loss, restore, and improve the management of ecosystems. These actions can help to:

• reduce GHG emissions from land management
• store and capture carbon
• mitigate the impacts of climate change
• build resilience and improve water quality
• provide critical habitat for Canada’s wildlife

Embracing the power of nature to support healthier families and more resilient communities is one of the five pillars of Canada’s Strengthened Climate Plan.

Natural Climate Solutions Fund

To address climate change and biodiversity loss, the Government of Canada has established the Natural Climate Solutions Fund, which will invest over $5 billion from 2021 to 2031. This initiative consists of three distinct, but related, programs:

•    2 Billion Trees Program led by Natural Resources Canada ($3.19 billion)
•    Nature Smart Climate Solutions led by Environment and Climate Change Canada (ECCC) ($1.4 billion)
•    Agricultural Climate Solutions led by Agriculture and Agri-Food Canada ($885 million)

Nature Smart Climate Solutions Fund

The ECCC-administered Nature Smart Climate Solutions Fund (NSCSF) is a $1.4 billion, ten-year fund to reduce annual greenhouse gas (GHG) emissions by 5-7 megatonnes (Mt) by 2030. The NSCSF will achieve this by supporting projects that reduce the loss, restore, or improve the management of ecosystems such as forests, wetlands, peatlands and grasslands. These projects will also benefit important habitat for migratory birds, species at risk and other species of cultural and/or socio-economic importance to local communities.

Note: Projects that are required by law, regulation or policy (e.g., mitigation requirement of a development/project approval) are not eligible for funding under the NSCSF.

Objectives

The primary objective of the NSCSF is to reduce Canada’s net GHG emissions using natural climate solutions, while benefitting biodiversity and human well-being. More specifically, the objectives are to:

• Avoid GHG emissions by halting or reducing the conversion of carbon rich ecosystems to another less carbon rich ecosystem (e.g. from a forest/grassland/wetland to cropland or an urban development)
• Restore carbon storage and biodiversity in converted or degraded ecosystems
• Reduce GHG emissions caused by natural resource use, including by implementing new forest harvesting management practices
• Develop policies, programs or tools with key actors in priority sectors, and implement them to reduce GHG emissions and improve biodiversity
• Measure and report on GHG outcomes from natural climate solutions
• Provide biodiversity and human well-being co-benefits
• Advance the federal commitment to reconciliation with Indigenous people
• Advance science and knowledge on natural climate solutions in Canada

Expected results

NSCSF investments during 2021-22 to 2030-31 will seek to reduce annual GHG emissions in 2030 by 5-7 Mt of GHG, and continue this lower annual rate until 2050. Ecosystems will continue to sequester carbon for many years after the initial investment ends.

The program is tracking the following results:

• Annual GHG emission reductions in 2030 (Mt CO₂e)
• Projected long-term (2050) greenhouse gas emission reductions (Mt CO₂e)
• Net change in policies driving ecosystem conversion relative to the land-base
• Total area (hectares) conserved, managed or restored for greenhouse gas mitigation
• Number of direct jobs created
• Number of methodological improvements for the land sector implemented in each annual edition of Canada’s National Inventory Report on Greenhouse Gases
• Number of Indigenous-led projects supported

Applications will be evaluated based on their anticipated contribution to these results. Projects are not necessarily expected to contribute to all results.  

Application instructions

Funding is now available through the Nature Smart Climate Solutions Fund - Emission Reductions Intake. There is no deadline to apply. Applications will be reviewed on an ongoing basis until funding for 2025-2026 is allocated. To learn more about the application process, visit the Nature Smart Climate Solutions Fund - Emission Reductions Intake web page.

Contact us

If you have any further questions, please contact us at ec.fscan-nscsf.ec@ec.gc.ca