Conservation Trust Funds (CTFs) are defined as “private, legally independent institutions that provide sustainable financing for biodiversity conservation.” (Conservation Finance Alliance, 2014). CTFs provide financing for a range of environmental actions often supporting protected areas, sustainable livelihoods, and other conservation related goals. The more general term “Environmental Funds” is used to describe CTFs and government managed funds, as wel,l such as forestry funds and other funds earmarked for environmental efforts. Two resources for case examples and additional valuable information on these CTFs include: (1) RedLAC, the Latin American and Caribbean Network of Environmental Funds, and (2) CFA’s Environmental Funds toolkit.
Water Funds
Trust Funds
Legal vehicle (trust) that supports biodiversity by mobilizing, blending, and overseeing the allocation of financial assets. It is a country-driven solution that should feature a clear focus, a rigorous project approval and implementation process, solid monitoring and evaluation frameworks, and strict control over asset/financial management and investment. The term encompasses conservation funds, carbon funds and other environmental funds. They can be regional, national or sub-national. Common type of capital structures include endowment, sinking and revolving funds.
Climate, Carbon and Forestry Funds
Legal vehicle (trust) that supports climate priorities by mobilizing, blending, and overseeing the allocation of financial assets. It is a country-driven solution that should feature a clear focus, a rigorous project approval and implementation process, solid monitoring and evaluation frameworks, and strict control over asset/financial management and investment. The term encompasses carbon sequestration funds. Climate and biodiversity are strongly related with well known ecosystem-based solutions for both mitigating and adapting to climate change.
Air Pollution Funds
Legal vehicle (trust) that supports environmental priorities by mobilizing, blending, and overseeing the allocation of financial assets for combating air pollution.
Protected Areas Trust Funds
Environmental Trust Funds established for the financing and support of individual protected areas, regional groupings of protected areas or entire protected areas systems. Funds can be local, national, or include several countries.
Oil and Gas and Other Natural Resource Revenue Funds
Legal vehicle (trust) that supports environmental priorities by mobilizing, blending, and overseeing the allocation of financial assets for generated from revenues or fees associated with non-renewable and renewable natural resources managed as a trust fund.
Regional Trust Funds
Legal vehicle (trust) that supports biodiversity by mobilizing, blending, and overseeing the allocation of financial assets at the regional level. Examples of regional environmental funds are found in the Caribbean, Central Africa and Pacific regions.
Payment for Ecosystem Services
Beneficiaries/users of an ecosystem service, such as water regulation, make a direct or indirect payment to the provider of that service in exchange for service provision and maintenance. This "user pays" concept implies that whoever preserves or maintains an ecosystem service should be paid for doing so. Beneficiaries/users of an ecosystem service can make a direct payment to the provider of that service through a private contract or an indirect payment through the intermediation of the State who charges the users through a tax or fee. Payments for ecosystem services are mostly found in the water, forest, agriculture and energy sectors. Also known as "Payment for Environmental Services"
Payment for Ecosystem Services - Private to Private
Beneficiaries/users of an ecosystem service make a direct payment to the provider of that service. The system can be voluntary using a private contract. Payments are mostly found in the water, forest, agriculture and energy sectors. For example, Nestle (formerly Vittel) pays farmers to refrain from using chemicals in north-eastern France and the City of New York pays farmers and other land owners to protect watersheds in the Catskill mountains, thus saving billions of dollars by avoiding the construction of major water treatment systems.