Collaboration to Reduce Storm Water Runoff in Washington, D.C.

Prudential to invest $1.7 million toward collaboration between The Nature Conservancy, Encourage Capital

nature conservancy, prudential financial, encourage capital

In an effort to reduce the polluting effects of storm water on regional waterways, Prudential Financial is investing $1.7 million towards a new pilot collaboration between The Nature Conservancy and Encourage Capital called District Stormwater LLC (DS).  The announcement was made at a White House event hosted by the Council on Environmental Quality. 

This new venture is expected to prevent the runoff of millions of gallons of pollutant-laden storm water from the nation’s capital into the nearby Potomac and Anacostia rivers.  Storm water runoff is now the fastest-growing source of water pollution both in the Chesapeake Bay Watershed and worldwide. 

Funds will be deployed to finance the development of green infrastructure on properties in the District of Columbia that measurably reduce storm water runoff through proven distributed, nature-based solutions. These projects, such as permeable pavement and rain gardens, will generate Stormwater Retention Credits (SRCs) under the District’s new Stormwater Credit Trading Program. The Conservancy and Encourage, an asset management firm based in New York, will oversee the enterprise.

“District Stormwater takes an innovative approach to improving critical environmental infrastructure in our nation’s capital and is a model for addressing similar issues nationally,” said Lata Reddy, vice president of corporate social responsibility at Prudential and president of The Prudential Foundation.  “This investment is a great example of how public policy can encourage private investments to solve urban challenges and the critical role that impact investments can play in catalyzing new markets.”

Underlying the DS investment is Washington, D.C.’s Stormwater Retention Credit Trading Program, an environmental market for storm water management. The District’s program allows land-constrained developers to meet part of their mandated storm water retention requirements by purchasing credits from offsite projects that reduce storm water runoff, like rain gardens, green roofs, permeable pavement and other green infrastructure practices. Credits can be sold on the open market to those who need them to meet regulatory requirements.

“We view Washington, D.C.’s Stormwater Retention Credit market as a powerful opportunity to accelerate use of green infrastructure through private sector investment while also reducing the need for public spending on storm water management,” said Marc Diaz, managing director for NatureVest, the impact investment unit of The Nature Conservancy. “We would very much like to see the financial model that allowed us to create this project in Washington, D.C. be replicated in other cities, bringing positive environmental and social impacts along with financial returns.”

“Encourage Capital believes that leveraging private capital can make a meaningful impact towards solving pressing environmental problems in urban communities.  Investment strategies like District Stormwater can help make cities more sustainable and resilient using proven nature-based solutions that are as effective, if not more effective, than traditional gray alternatives, while offering meaningful co-benefits to communities and the environment,” said Eron Bloomgarden, partner at Encourage Capital. “We envision a world where the built infrastructure is designed and constructed to harness the power of natural systems, and where cities recognize the value and potential of natural ecosystems as mission critical infrastructure. We hope and expect that this pilot will pave the way for more investments like it in Washington, D.C. and beyond.”

"The Nature Conservancy is committed to demonstrating that cities can become more resilient with strong, nature-based solutions," said Dr. Elizabeth Gray, executive director of the Conservancy in Maryland and D.C. “Through this new collaboration, we can show how innovative financing can bring such nature-based investments to Washington, D.C. where they can make a positive impact on the health of our watershed.”

Next steps for DS include identifying priority sites around Washington, D.C. to implement strategically placed green infrastructure. The projects are anticipated to benefit the District’s waterways, provide social benefits for local communities and financial return for investors. 

 

 

Source: 
The Nature Conservancy

Post new comment

  • Web page addresses and e-mail addresses turn into links automatically.
  • Allowed HTML tags: <a> <em> <strong> <cite> <code> <ul> <ol> <li> <dl> <dt> <dd>
  • Lines and paragraphs break automatically.

More information about formatting options

CONTACT