AMES Habitat Fund
Business Models
Long-term conservation and community upliftment needs significant and ongoing revenue. Relying on donations alone is unsustainable. We believe nature is valuable enough to empower its own protection. That's why we facilitate nature-based businesses which can provide sustainable finance, while supporting a thriving wilderness.
Below we highlight the business models we support through the Habitat Fund.
Eco-tourism
The Global Ecotourism Network defines ecotourism as “responsible travel to natural areas that conserves the environment, sustains the wellbeing of the local people, and creates knowledge and understanding through interpretation and education of all involved (visitors, staff and the visited)”
There is enourmous potential in ecotourism as a growing sector to draw much needed investment, promote conservation and create meaningful work for the continent.
Before the pandemic, Africa’s tourism industry was growing faster than its economy as a whole. Wildlife is an essential drawcard for tourists who visit protected and conserved areas. This in turn raises the importance of investing in wildlife as an asset to promote tourism.
According to the World Economic forum, tourism generated 40% more full-time jobs than the same investment in agriculture. Tourism also has twice the job creation power of the automotive, telecommunications and financial industries.
Africa still only receives a small amount (5%) of global tourism arrivals, indicating that there is significant room for growth in the tourism economy.
Carbon Sequestration
Forests, grasslands, mangroves and peatlands all store carbon. By rewilding or protecting threatened habitats with carbon potential, carbon credits can be earned and traded in the voluntary or compliance market. Currently, 1 credit = 1 ton of carbon sequestered. The carbon market has been developed as a nature-based solution to allow carbon emitters or philanthropists to finance a certified climate action project and bring about a real reduction in emissions elsewhere in the world. Due to its success to date, the demand for certified credits is skyrocketing. Demand is set to grow 100x by 2050, with the market set to expand 50x to a $50 billion sector by 2030.
A successful credit must satisfy the following criteria:
1) Additionality- Projects are unable to exist without revenue derived from carbon credits.
2)Verification- Monitored, reported, and verified by a credible third-party.
3) Permanence- Carbon reduction or removal will not be reversed.
4) Measurability- According to scientific data through a recognised through a recognized methodology.
5) Avoided leakage- An increase in emissions should not occur elsewhere, or account for any that occur.
Renewable Energy
Decarbonising economies by investing in renewable energy production. Much of Africa is very well positioned to take advantage of solutions such as solar or wind. South Africa alone receives over 2500 hours of sunlight a year. The country has also reached a pivotal tipping point due to the failings of its National Electricity producer, ESKOM, to keep up with demand. It now seeks to generate 9600 MW by 2030 from private renewable energy producers. This coupled with the sharp drop in costs of components such as photovoltaic cells means there has never been a better time to invest in renewables than today.
Biocredits
Carbon credits have seen enormous success in recent years in bringing commercial value to forests left standing by quantifying the carbon they hold. Biodiversity credits are the evolution of this, which aims to address the importance of an entire ecosystem or particular species therein by valuing the ecosystem services they provide us with. In essence, putting a monetary value to the (until now) intangible benefits nature provides us with, thus recognising it and valuing it appropriately in our economic models.
Global thought leaders in all disciplines are currently working to define the parameters with which it is defined, understood and quantified. As part of the Habitat Fund, we too are playing our role by pioneering a model for African Habitats. The habitat fund will be collaborating with the Biodiversity Credit alliance. This is groundbreaking work which can play an integral role in financing African ecosystems such as savanna or semi dessert that until now have never had appropriate access to conservation funding.
Real estate
Acquiring land, adding value and ensuring the permanent protection through two seperate methods;
1) Leasing concessionary land from local communities so that they retain ownership, become stakeholders and earn rental income from the land use. Rental income is linked to the permanence of a thriving ecosystem.
2) Acquiring the land through title deed ownership. Permanently protecting the land through zoning conversion to a protected nature reserve. The land's value is unlocked by upgrading the infrastructure and servicing the land so that it can sustain the development of nature-based businesses.
In some instances, a blend of both methods can be achieved for maximum benefit for all stakeholders.