a wetland during a blue evening
Investing in nature Sunrise over the Nanticoke River watershed located in the heart of the Delmarva Peninsula, Chesapeake Bay watershed, Maryland. © Alan W. Eckert

Mark Tercek

Innovative Solutions for Nature and Climate

Chief Executive Officer, The Nature Conservancy

Mark Tercek is Chief Executive Officer of The Nature Conservancy, the global conservation organization known for its intense focus on collaboration and getting things done for the benefit of people and nature. He is the author of the Washington Post and Publisher’s Weekly bestselling book Nature’s Fortune: How Business and Society Thrive by Investing in Nature.

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The Environmental Council of the States’ 2016 fall meeting gathered the senior-most environmental officers in each of the 50 states. Below is the keynote speech I delivered at the meeting on September 26 in Wheeling, West Virginia.

The Environmental Council of the States Fall Meeting Keynote Speech

Good afternoon, everyone. It’s great to be here today with environmental leaders from all 50 states.

Everything we do at The Nature Conservancy is an outgrowth of the extraordinary legacy of environmental protection you and your colleagues have built over the past few decades. In my view, environmental law and environmental protection are two of the most successful examples of government policy over the last 40 years.

In most respects, environmental policy has been more successful than budget policy, energy policy, foreign policy, education policy—you name it. And this tremendous success is due mostly to your work and the great programs you lead.

Gina McCarthy probably summed it up best at a recent 40th anniversary celebration for the Safe Drinking Water Act.

Here’s what she said, and I quote: “Americans drink a billion glasses of tap water every day. Before the Safe Drinking Water Act, 40 percent of that water didn’t meet basic health standards. Today, 90 percent meets all the standards all of the time.”

Water safety remains a very serious health issue in many countries. But not here—with rare exceptions like Flint—because of the work of state health and environmental agencies.

And that success extends to air quality and the freshwater we use for recreation. Thank you very much for what you do.

But there is no resting on your laurels. The biggest challenge ever is now bearing down on you. How are you going to stay on top with climate change knocking on your doorstep?

a pond reflecting a blue sky dotted with clouds.
Greenbrier River The Greenbrier Valley is known as one of West Virginia’s most beautiful landscapes. © Kent Mason

I’m not here to give you a precise prescription to address climate change. But I think you will be most likely to succeed if you do what has worked for you before and you champion the following principles:

  • Building broad bipartisan support—red states and blue states on the same page in today’s parlance.
  • Creating shared federal and state authority with lots of flexibility for the states.
  • Ensuring that everybody respects and uses the best available science.
  • Insisting on the most cost-effective solutions.
  • Using markets to reduce costs.
  • Driving new technologies.
  • And forming partnerships with new players, including your own PUC and energy agency.

I suppose there are other challenges to our nation that are just as urgent. But you are at the forefront once again because of climate change, so get the rust off your best tools. We need you to go out there and get your job done for us again.

Now, I know it’s not going to be an easy road. It’s going to take a great deal of innovation to address climate change and other pressing environmental problems. That’s what I want to talk to you about today.

You’re out there every single day on the front lines of the environmental challenges that face our citizens. We at The Nature Conservancy recognize that we have a great deal to learn from you.

We deal with the same kinds of resource challenges and political constraints that you each face. You have no choice but to be scrappy, pragmatic and resourceful. You have to innovate every day. We try to do the same.

For us at The Nature Conservancy, we try to see every challenge as an opportunity to be even more innovative. We try to find smarter, better and more cost-effective ways to do our work. And I’m sure you approach your work in the very same, good way—with an openness to innovation.

Today, I’d like to give you some examples of how The Nature Conservancy has embraced natural solutions to traditional environmental challenges.

First, I want to talk about our efforts focused on investing in nature. I think this is a great way to scale our work. I feel so strongly about this that I even wrote a book about it: “Nature’s Fortune.” And thanks, by the way, for letting me do a book signing here after this talk.

Second, I want to talk about climate change—how we at The Nature Conservancy are trying to accelerate our efforts on this front.

We recognize that this isn’t an easy topic. It hasn’t been altogether easy at The Nature Conservancy—I’ll tell you more about that in a bit.

But again, if we try new approaches and really emphasize the role of nature in addressing environmental challenges, I think we can all accelerate progress on climate.

 

a rocky outcrop under a cloud-studded blue sky
Panther Knob The Nature Conservancy's Panther Knob Preserve in West Virginia. © Kent Mason

The Nature Conservancy’s Evolving Approach

Before I get into these two areas, let me share a little bit about The Nature Conservancy—or TNC, as we call our organization—because some of you may not be familiar with our work.

For 65 years, we’ve been known as a pragmatic, nonpartisan organization that brings diverse parties together to advance conservation progress. That approach allowed us to become the largest conservation organization in America and the world.

Our work is firmly rooted in strong science, creative partnerships and boots on the ground.

For example, back in the 1970s our scientists partnered with the state of South Carolina to create the first state Natural Heritage Program.

We then provided scientific and technical support to help replicate the program across the continent. Today, this network has grown to 80 programs across the entire Western Hemisphere that provide invaluable data on rare plants, animals and natural communities.

We pioneered the land trust movement, acquiring more than 7 million acres in the U.S. alone and providing a template for many other great organizations across the country to add to that sum.

But as the threats to nature became more complex, we came to realize that buying land to protect nature would only get us so far. We had to do more.

So we began forming partnerships with landowners to identify and implement sustainable practices on working lands. We found we could cement these partnerships with conservation easements to extend our reach to millions of additional acres.

We branched out into marine and freshwater conservation. And we began working with businesses, governments and communities on policies that will transform the way they use nature on a much larger scale.

bison with purple mountains in the background
Bison waves crashing against Maine's rocky coast © Nick Hall

For most of our history, our work was largely funded by philanthropic capital and government grants. But, as a reformed investment banker, I couldn’t help myself. I kept thinking about whether there were other sources of capital we could draw on.

I knew there were constraints on government funding and likely limits to philanthropy. And I wondered whether there was some way we could generate more capital for our mission.

I felt particularly strongly about pursuing this because it seemed to me investing in nature—or green infrastructure, if you will—can be such a good deal. Green infrastructure is often cheaper and more effective than manmade, or gray, infrastructure.

Investing in Nature: Water Funds

So, what exactly do I mean by investing in nature? Let’s start with water.

One of the first great and very famous examples of using nature to meet an environmental requirement happened in New York City. You probably know this story. The city protected its watershed in order to protect its drinking water. It was an innovative idea that allowed the city to avoid building a water filtration plant, which would have cost billions. And the benefits for nature, wildlife and communities were great, too.

That approach—investing in nature—was formally recognized in the 1996 amendments to the Safe Drinking Water Act and made available to other cities with protected reservoirs.

At TNC, we took that concept abroad. And now, based on that experience, we’re bringing it back home again. We call this approach a water fund.

Our first water fund was in Quito, Ecuador. A few years ago, our local TNC team learned that city officials were considering building an expensive new water treatment plant. The city wanted to ensure it would have sufficient clean water for its growing population.

We approached city officials with an alternative strategy. We made a business argument—not an environmental one. We told them: “There’s a cheaper way to secure clean water.”

Here’s what we suggested: Rather than build a plant to clean dirty water, the city could invest in conserving the watershed upstream. That way, by working with farming and ranching communities upstream and improving their practices, we could keep the water clean and safe for drinking at a much lower cost.

The city said, “OK. Let’s give that a try.” So TNC and the city—specifically Quito’s water company—pooled together a relatively small amount of money to begin to change the ranching and farming practices upstream.

The interventions were rather simple. We did things like building fences to keep cattle away from the river, installing plantings along the riverside to keep soil and dirt from falling into the water and improving ditching to help prevent fertilizer runoff.

And it worked. Ultimately, the government changed the rules so that every water user in Quito now pays a small fee for upstream conservation. And voila—we have conservation that pays for itself.

Downstream users of water pay for upstream conservation of nature in order to secure the important ecosystem service that nature is providing—clean and healthy water for drinking.

By the way, the watershed upstream? It’s Ecuador’s Condor Bio Reserve—important wildlife habitat that we wanted to protect anyway. Upstream communities benefit, too. So it’s a triple win—the watershed, habitats and communities all come out ahead.

We think this is a great model. Instead of raising philanthropic capital, users of nature’s services pay for conservation. And instead of building expensive gray infrastructure, we instead invest in green infrastructure.

It’s been such a good idea that we now have 19 water funds up and running in Latin America, an additional 21 more coming in the region, and water funds now underway in China, Africa and the U.S.

I really could go on and on about this topic. In fact, I wrote a long chapter about it in my book. This model works.

Investing in Nature: D.C. Stormwater

Now let me shift gears and give you another example—one closer to home and, more precisely, in my hometown of Washington, D.C. The city is investing in nature to address stormwater runoff—a leading cause of water pollution.

In D.C. and in many cities, during intense rainstorms—which happen now more and more often—the water flushes into our local storm drain systems, picking up grime and pollution that wash right into the Potomac and Anacostia rivers.

And when stormwater and sewer systems are combined, big storms send raw sewage flowing right into nearby waterways like the Chesapeake Bay. It’s a huge problem in D.C. and in many of your states, as well.

Well, the EPA is cracking down. Cities face federal legal action under the Clean Water Act when stormwater pollutes nearby waterways. Penalties range from millions of dollars in fines to billions in mandated spending on infrastructure upgrades.

So here’s what we’re doing to help.

a curb with mulch and plants on a city street
Bioswale on Columbus street in Manhattan. © Kevin Arnold

Thanks to forward-thinking Washington, D.C., regulations, the city now mandates that new developments retain stormwater runoff caused by their projects.

What’s unique about D.C.’s regulation is that it allows developers to use offsite, green infrastructure solutions to meet half of their stormwater retention requirements. Developers can buy credits from retention projects built all across the city. Right now, D.C. is the only city that allows developers to do this.

This system allowed TNC to raise money from institutional investors to fund a development company that is building green infrastructure projects like rain gardens, bioretention areas and wetlands. The new company will sell stormwater retention credits to developers.

These types of natural solutions really soak up stormwater runoff and slow water down before it reaches overburdened sewer systems.

For example, I recently visited a green infrastructure demonstration site that was a large parking lot—barren, unattractive. And it drained off an extraordinary amount of stormwater into a nearby river.

We worked with partners to remodel the parking lot to include rain gardens and bioretention features. These features not only beautify the lot but also absorb significant amounts of stormwater. They create jobs, too, because those wetlands need to be maintained.

We are very confident that projects like this will be a big win for everyone in D.C.

The green infrastructure projects will protect the Anacostia River, the Potomac River and the Chesapeake Bay. They ease fiscal pressures on tight government budgets and local resident rate payers. They create green space in underserved neighborhoods.

They save developers money because onsite solutions like green roofs and cisterns can often be more expensive and reduce the amount of space for desirable amenities such as parking spots, pools or other roof space. They create good local jobs.

And through the sale of the credits, they create returns for so-called “impact investors.” These are emerging investors who are looking for good investment opportunities where they can also accomplish some environmental goals.

It’s a great model. D.C. had an environmental problem. It adjusted its regulations to deal with the problem in an innovative, market-based way.

We think this is a strategy that we can really take to scale. We’d be eager to work with any of you to implement similar programs in your states.

Investing in Nature: Iowa Floodplains

Let me give you one more example of investing in nature.

I’ve described how nature can help clean our drinking water and reduce stormwater pollution. Well, as you know, nature can help address another big water challenge: flooding.

In my book, I describe the terrible flooding that Iowa has experienced in recent years. On 15 occasions in the past decade, FEMA has issued a disaster declaration due to severe flooding in the state.

Iowans have come to understand that this devastation has been exacerbated by the destruction of the state’s floodplains. Once floodplains are degraded or disconnected from rivers, they no longer absorb excess water from rivers swollen by rain storms.

And manmade solutions like levees can actually exacerbate flooding, raising water levels and speeding up a river’s flow.

So what are Iowans doing about this problem? They’re investing in nature.

Meadow of blazing star (Liatris ligulistylis) and Maximilian sunflower (Helianthus maximiliani) at a prairie pothole
Comertown Pothole Prairie Meadow of blazing star (Liatris ligulistylis) and Maximilian sunflower (Helianthus maximiliani) at a prairie pothole © Harold E. Malde

The state recently received a $96 million federal disaster resilience grant from the U.S. Department of Housing and Urban Development. Working with partners like TNC, Iowa State University and state agricultural alliances, the state is putting that funding to work on large-scale watershed restoration projects.

Together we are constructing wetlands, restoring floodplains and oxbows and working with farmers to plant cover crops and buffer strips. These projects will both reduce downstream flooding and improve water quality during and after big rain events.

Many of these practices also help reduce nutrient loading into rivers and improve water quality both locally and in the Gulf of Mexico.

This is another compelling example of what I mean by investing in nature. Interventions like this can address a range of environmental challenges in a cost-effective, win-win way. That’s what my book is about, and it includes many other good examples.

Tackling Climate Change

Now let me turn to the second area I want to talk about today: climate change.

This is not an easy topic, as I’m sure you know. Taking on the climate challenge hasn’t been easy for TNC in all respects, either.  Indeed, we were long viewed as a conservation organization that could avoid messy, contentious issues like climate.

But not anymore.

We’re a science-based organization, and I can tell you that we believe the science here is crystal clear: We must tackle climate change with urgency and bold action.

But even with strong science behind us, this hasn’t been easy for some of our chapters.

Some of our supporters faced—and still face—stiff political headwinds in their home states on this issue. So the thinking of some of our members was pretty straightforward: Why risk our brand getting involved in a highly charged issue like climate?

But these dedicated conservationists are seeing the places they love change because of higher temperatures, warmer lakes and streams, rising sea levels and disintegrating food webs. The fact is that the same people who gave so much to save our special places are now alarmed that those special places may disappear.

aerial view of islands and coral surrounded by tropical waters.
Palau The coral reefs of Palau are part of a massive interconnected system that ties together Micronesia and the Western Pacific. © Ian Shive

Not only does climate change threaten all of TNC’s plans going forward—it threatens to undo much of what TNC has accomplished over the last 65 years.

Take North Carolina’s Albemarle Peninsula as one stark example. It’s one of The Nature Conservancy’s great success stories. Decades ago, the Prudential Insurance Company gave us a large land donation on the peninsula.

Over time, we’ve worked with partners in the community to construct a protected landscape that covers more than 500,000 acres and includes five national wildlife refuges.

It’s a beautiful place, teeming with wildlife. It’s home to the endangered red wolf and provides important nursery areas for fish and shellfish. It also plays an important role in buffering the coast from storms.

But it’s beginning to disappear.

As rising sea levels undermine the special soil structure that covers these lands, the shoreline is rapidly eroding. By the end of the century, the peninsula is likely to be just a small island of only a few thousand acres.

All of our work and all of our investment will be, literally, underwater.

A dead cypress forest marks the arrival of saltwater in South Carolina’s Sampit River.
Dead Cypress Forest A dead cypress forest marks the arrival of saltwater in South Carolina’s Sampit River. © Mac Stone

This is just one example among many that we are seeing in the U.S. and around the world. We are seeing place after place that we’ve worked to protect change right before our eyes.

Increasing ocean temperatures are bleaching coral reefs. Likewise, extreme drought and rising temperatures are drying up habitats that at-risk species depend on. And more frequent and intense storms are regularly causing what used to be considered 1,000-year events—like last month’s devastating flooding in Louisiana.

Each of you in this room probably has your own Albemarle—a tangible example of how climate is impacting your state.

But, we recognize that addressing climate change is not easy.

Transitioning our economy to lower-carbon sources of energy will be hard. This is certainly evident in places like here in West Virginia.

I can imagine the challenges that coal communities are struggling with right now as the power sector shifts away from coal.

It’s important, therefore, that we seek innovative solutions like those I described earlier. Solutions that address climate change not only in practical, economically efficient, market-based ways but also fairly—with investments in American workers and communities.

Let me describe some of the solutions The Nature Conservancy is pursuing.

Exploring Natural Climate Solutions

First, we are scaling up our work around the world to protect ecosystems that absorb and store carbon.

Our scientists have determined that protecting, restoring and changing how we manage forests and other ecosystems could contribute more than one-third of the greenhouse gas reductions needed by 2030 to stay on the pathway of the Paris climate agreement.

And there’s more positive news. These natural climate solutions are not only cost-effective, but they also deliver a number of important co-benefits. They improve water access and security, bolster biodiver­sity and support livelihoods.

Of course, simply identifying the opportunity is not enough. Now we need to find innovative ways to finance and significantly scale up this work.

Realizing the full potential of these natural climate solutions will take great levels of collaboration and funding. We’ll need the participation of farmers, ranchers, loggers, businesses, banks and government agencies. That’s why we’re ramping up our work with all of these sectors.

All of you in this room are well-positioned to ensure that natural solutions play a role in climate change mitigation. These solutions can include reforestation, carbon sequestration in agricultural soils and grassland protection.

I’m not here to lobby for the Clean Power Plan. But with or without it, a lot of you will likely be moving your programs to new CO2 mitigation policies that include carbon markets and regional trading in the next few years.

That provides you an opportunity to invest in nature. And I hope you take it.

Taking Initiative in Every State

Now let me turn to our second major climate focus.

Here in the U.S., TNC is fortunate to have a network of 50 strong state chapters, each of which is led by a great board of volunteer trustees.

These trustees are Democrats, Republicans and Independents. They’re rural and urban, young and old, farmers and ranchers, scientists and businesspeople. They’re a diverse group. But they have two things in common.

One, they are passionate about nature. And two, they are fierce believers in science. The same can be said about my 4,000 TNC colleagues around the world.

And now we’re putting this big and diverse team to work on climate.

All 50 of our state chapters have committed to pursuing action on climate change.

Some focus their climate efforts on policy work in connection with state and local governments. Some go after on-the-ground conservation projects. And others are reaching out to state leaders, businesses and communities to identify climate actions that may also provide economic gains in their states.

The idea is to find common ground with diverse groups. Using our local knowledge, experience and relationships, we’re pushing for practical solutions to the climate challenge. And in almost all cases, those solutions come in partnership with state governments.

Laura Crane and a Fuller Star employee walking through the array of solar panels at the Fuller Star plant in Lancaster, California.
Solar Panel Array Laura Crane and a Fuller Star employee walking through the array of solar panels at the Fuller Star plant in Lancaster, California. © Dave Lauridsen

For example: In Florida, TNC and other conservation groups worked with Republican leaders to support a ballot measure incentivizing private solar installations.

Just a couple of weeks ago, voters overwhelmingly passed the measure—a big victory for the “Sunshine State,” which ironically has lagged behind other states in the use of solar.

In Ohio, we’re engaging with state agencies and lawmakers to help inform the current debate over Ohio’s renewable energy and energy efficiency standards.

To that end, TNC and the Environmental Defense Fund collaborated on an economic study that we’ll be releasing soon. We found that increasing renewable energy and energy efficiency in Ohio could create thousands of new jobs every year through 2030 and billions of dollars of economic benefit, including lower health care costs.

And it’s not just energy policy that matters when addressing climate. In Iowa, TNC is launching a campaign to reform how farmers manage their fields and use fertilizer.

The U.S. Department of Agriculture estimates that with just voluntary programs, we could reduce nitrous oxide emissions (a more potent greenhouse gas than carbon dioxide) by 7 million metric tonnes per year by 2025.

But this will require famers to improve nutrient management on 4.5 million new acres each year from 2016 to 2025. This will take an all-hands-on-deck approach to outreach and education in farm states like Iowa.

And finally, here in beautiful West Virginia, we’re reaching out to policymakers, business leaders and others through a series of listening sessions and roundtable discussions.

We’re exploring how forest conservation and clean energy can be part of the solution for West Virginia’s economic future. We’re also partnering with two of West Virginia’s leading academic institutions to identify specific forest conservation and clean energy opportunities that could provide both economic and environmental gains.

Spearville Wind Farm just north of the town of Spearville, in Ford County, Kansas.
Spearville Wind Farm Spearville Wind Farm just north of the town of Spearville, in Ford County, Kansas. © Jim Richardson

We’ve still got a long way to go, but we’re proud of our efforts so far to find common ground with diverse parties to tackle the climate challenge.

I’m hopeful that we can continue to find practical, win-win solutions that work for all involved.

Making Progress Together

Let me end where I began.

We admire the success you’ve achieved in strengthening and extending environmental protection.

In turn, at TNC we’re also proud of what we’ve accomplished by bringing our kind of innovation to conservation and nature.

Looking forward, we’re eager to roll up our sleeves and work with you to build on our shared history.

I’ve talked about two areas where I think we can do that together.

First, when we look at nature as an investment opportunity, it seems to me that there are still considerable ways for us to make progress together in pursuit of our environmental objectives.

The more we pursue these win-win opportunities, the more we find.

And second, while I realize climate is a trickier issue, we can make a lot of progress together if we do our work in a way that’s sensitive to the economic and political circumstances in each of your states.

Again, thank you for the important work you do to protect our land, water and air. I’m here today to say that we admire what you’ve accomplished, and we’re eager to do everything we can to help you move forward.

Thank you very much.

Chief Executive Officer, The Nature Conservancy

Mark Tercek is Chief Executive Officer of The Nature Conservancy, the global conservation organization known for its intense focus on collaboration and getting things done for the benefit of people and nature. He is the author of the Washington Post and Publisher’s Weekly bestselling book Nature’s Fortune: How Business and Society Thrive by Investing in Nature.

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