Blue Forest Launches New Forest Resilience Bond (FRB) to Address Catastrophic Wildfire Threat in the Upper Mokelumne River Watershed

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Feb 15, 2024, 11:00 ET

SACRAMENTO, Calif., Feb. 15, 2024 /PRNewswire/ -- Blue Forest, a conservation finance non-profit focused on forest restoration, is proud to announce the launch of the Upper Mokelumne I Forest Resilience Bond (Upper Mokelumne I FRB) in collaboration with the Upper Mokelumne River Watershed Authority (UMRWA) and the Eldorado National Forest. The Upper Mokelumne I FRB aims to mitigate the growing threat of catastrophic wildfires in the Upper Mokelumne River watershed through strategic forest restoration and conservation finance.

The Upper Mokelumne River watershed faces an increasing risk of catastrophic wildfire due to drought, disease, a changing climate, and overgrown forests resulting from decades of fire suppression. In response, the Eldorado National Forest and UMRWA are taking urgent action to reduce this risk through the Forest Projects Plan Phase 1 (FPP1). Under a stewardship agreement with the Eldorado National Forest, UMRWA will implement ecological thinning, hazardous fuel reduction, prescribed fire, and aspen regeneration on more than 26,000 acres of National Forest System Land. This comprehensive restoration approach will reduce the risk of catastrophic wildfires, protect critical infrastructure, and mitigate the effects of drought on the Mokelumne River watershed.

The FRB is a model co-developed by Blue Forest, World Resource Institute (WRI), the USDA Forest Service, and the National Forest Foundation. It is an innovative finance mechanism that blends public and private capital to finance forest restoration projects on public lands to protect communities, ecosystems, and rural livelihoods through quantifying the value of ecosystem restoration projects. This provision of upfront capital, supported by contracted beneficiary commitments, allows for financial flexibility that accelerates the pace and scale of restoration activities as well as the ability to quickly pay local contractors.

According to Blue Forest Co-Founder Nick Wobbrock, "It is clear that watershed-scale work requires watershed-scale investment with tools like the FRB that can support collaboration with utilities. By building upon the success of previous FRBs, we are excited to launch the Upper Mokelumne I FRB with partners on the Eldorado National Forest, including UMRWA, who had a vision to plan and implement this landscape restoration plan."

The Upper Mokelumne I FRB, financed by mission-driven investors through the Blue Forest FRB Catalyst Facility, will support restoration activities for the first portion of the $64 million FPP1. Planning for FPP1 was funded by UMRWA and the Sierra Nevada Conservancy, and implementation of the project has started with $12 million in grant funding from two CAL FIRE grants. The Upper Mokelumne I FRB is made possible through further funding from beneficiaries including Pacific Gas and Electric Company and PepsiCo Beverages North America, which will fund additional acres of treatment and enable a zero-interest line of credit for UMRWA to accelerate the project implementation.

"This partnership with Blue Forest and the launch of the Forest Resilience Bond reflect our commitment to finding innovative solutions to address the growing threat of catastrophic wildfires," said Richard Sykes, Executive Director of the Upper Mokelumne River Watershed Authority. "The FRB is an important part of our efforts; we are taking proactive steps to protect our watershed, enhance water quality, and ensure the long-term sustainability of our natural resources."

Blue Forest, WRI, and the Bonneville Environmental Foundation collaborated to analyze the benefits of FPP1 for various beneficiaries, including electric utilities, water utilities, and corporations. Preliminary analyses have estimated over $40 million in water volume and quality benefits, a figure that will likely grow as additional beneficiaries are engaged. The creation of the Upper Mokelumne I FRB enables these diverse beneficiaries to collectively expand funding for crucial wildfire risk reduction and paves the way for partnership with future beneficiaries on this landscape to secure full project funding.

"The Eldorado National Forest is proud to partner with Blue Forest and the Upper Mokelumne River Watershed Authority on this critical initiative," said Joe Stout, Forest Supervisor of Eldorado National Forest. "The Forest Resilience Bond will allow us to accelerate the pace and scale of restoration efforts and reduce the risk of catastrophic wildfires, while also promoting forest health and resilience. This collaboration represents a significant step in protecting the ecosystems and communities that rely on forest resources in this important watershed."

About Blue Forest:

Blue Forest is a conservation finance non-profit focused on advancing forest restoration through scientific research, financial innovation, and collaborative partnerships. Since 2018, Blue Forest has managed investor capital through its flagship financial product, the Forest Resilience Bond (FRB), which deploys private capital to finance forest restoration projects on private and public lands to reduce the risk of catastrophic wildfire. Learn more: blueforest.org

About WRI

World Resources Institute (WRI) is a global research non-profit with offices in Brazil, China, Colombia, India, Indonesia, Mexico and the United States, and regional offices for Africa and Europe. Our over 1,800 staff work with partners to develop practical solutions that improve people's lives and ensure nature can thrive. Learn more: WRI.org and on Twitter @WorldResources.

SOURCE Blue Forest