The European Union Nature Restoration Law (NRL) entered into force in 2024. The NRL sets quantitative restoration targets aimed at improving natural habitats that are currently in poor condition, with substantial leeway for countries to choose implementation pathways that fit their priorities.
This Working Paper examines three pathways: (1) evenly spreading restoration efforts across all ecosystems; (2) prioritising cost-efficiency; and (3) maximising carbon sequestration. Each approach yields vastly different outcomes. This paper provides insights into the trade-offs.
For countries seeking to minimise costs in the short run, an 81 percent reduction in costs over the period 2025-2030 is possible compared to a baseline scenario of an even restoration of all ecosystems. Countries that aim to maximise carbon sequestration benefits can achieve a 54 percent increase in climate impact over the same period. However, the different pathways converge after 2040. Prioritising cost minimisation in the early years could lead to higher costs later if delays in investment in the more costly restoration projects allow habitats to continue to degrade.
Maximising cost-efficient carbon sequestration is possible, allowing relatively low investment costs and high sequestration. Countries should adopt a holistic approach to pathway selection, considering the full spectrum of ecological and societal gains alongside climate mitigation.
Land ownership is an important factor that shapes feasible and effective pathways. In countries such as Spain and Germany, where private entities own substantial shares of agricultural and forest lands, policies should incentivise private investment, including through norms, subsidies or pricing mechanisms. Countries with substantial public landholdings, such as the Netherlands, may find it easier to implement direct restoration projects. These structural differences will influence the cost and pace of restoration and also the design of policies and governance mechanisms to ensure compliance with NRL targets.
Source : Bruegel
