Finance Solutions for Nature 2025

2.4 Environmental credits Environmental credits are increasingly used tradeable certificates that represent verified uplift. Overview Environmental credits are verified units of positive environmental outcomes, including biodiversity, water, carbon and nutrient credits. Though developed independently, projects increasingly blend credits via stacking, bundling or stapling. Third-party verification by standards bodies is essential to ensure credits represent real, measurable, durable and additional benefits. Credits may be purchased for compliance or voluntarily – for thematic goals or resilience – via direct project deals, intermediaries or market platforms. Potential to mobilize capital for nature Environmental credits aim to unlock private capital by monetizing a range of nature-positive outcomes, such as ecosystem restoration, water management, carbon reductions and nutrient mitigation. Near- term market growth depends on regulation, while long-term scale requires nature loss to be priced into the broader economy. Issuance sizes vary from $50,000 to $10 million, with prices ranging significantly based on the type of environmental outcome, associated co-benefits, ecosystem characteristics and whether the credit is traded in compliance or voluntary markets.60 For example, most voluntary biodiversity credits sold to date have been priced at $25 or less per credit. However, when standardized to one hectare, prices can range from $2 to $60,000 per hectare. Projects involving Indigenous Peoples and Local Communities may command a premium of 15% to 300%. Nature projects with credible long-term offset agreements can signal future returns and attract scale capital, similar to power purchase agreements in renewables. Ability to price nature into markets Environmental credits assign financial value to specific ecosystem outcomes, especially in compliance markets, helping embed nature in decision-making.However, credit prices often diverge from true ecosystem value due to market dynamics and project quality. Natural capital accounting is not consistently used in pricing. Credits can support local biodiversity offsets if designed with strict, like-for-like criteria to ensure ecological relevance and accountability. Standardization and certification frameworks aid in quantifying impact, though monitoring remains complex due to baseline setting, additionality, verification and registry management. Pathways to mainstream Integrity frameworks include the High-Level Principles to Guide the Biodiversity Credit Market published by the World Economic Forum, the International Advisory Panel on Biodiversity Credits (IAPB) and the Biodiversity Credits Alliance (BCA),61 the Core Carbon Principles of the Integrity Council for the Voluntary Carbon Market (ICVCM),62 the Claims Code of Practice of the Voluntary Carbon Markets Integrity Initiative (VCMI)63 and others.64 Adhering to these is vital to address risks such as additionality and permanence, as well as to ensure local and Indigenous inclusion – key for building market credibility and capital flows. While impact quantification is costly, it is essential for scale. Stacked credit pilots combining multiple ecosystem services – if transparently accounted and truly additional – can unlock new revenue streams and bridge siloed markets. Regulated markets can drive demand by building the enabling environment (e.g. registries, standards, certification, interoperability) and nudging buyers to adopt environmental targets. In July 2025, the EU launched a Roadmap towards Nature Credits to create voluntary biodiversity and nature markets and convene experts to develop clear standards and certification.65 Strengthening awareness and capacity among Indigenous Peoples and Local Communities is critical to ensure their participation and rights are respected in credit development. Regulated markets can drive demand by building the enabling environment – registries, standards, certification, interoperability – and nudging buyers to adopt environmental targets. Finance Solutions for Nature: Pathways to Returns and Outcomes 22