Private Capital for Public Good
Private Capital for Public Good's inaugural campaign is catalyzing the creation of the first ever conservation-based Social Impact Bond.
Social Impact Bonds (SIBs) incentivize private investors to fund preventative programs. A successful preventative program saves government money in the future. The government then uses the savings to return investors their principle, plus interest.
PCPG is using wildfire prevention as the first application for a conservation-based SIB. Small scale fires play an important role in forest ecosystems. However, due to the past century's wildfire suppression strategy, forests are unnaturally blanketed with fuel wood. As a result, two-thirds of federal forests - an area larger than Texas - are at high risk of catastrophic wildfire.
The Structure of a Wildfire Social Impact Bond.
Reducing fuel loads and conducting prescribed burns make forests less susceptible to a severe wildfire and improve the health of forest ecosystems. Administering these programs is considerably cheaper than putting out large, out-of-control wildfires. Therefore, a SIB can solve the problem of perpetually underfunded wildfire prevention. Investors finance these programs, and our forests, our climate, the U.S. Forest Service, taxpayers, and investors all benefit.
PCPG has the expertise and dedication to educate and unite the diverse stakeholders needed to implement a wildfire SIB. Once successful, other organizations can follow this model to finance a variety of conservation projects, from improving storm-water infrastructure to increasing energy efficiency in buildings to protecting and restoring wetlands.
The creation of the first conservation-based SIB has the potential to open the floodgate of private investment for conservation.