The European Investment Bank has published a paper on water resilience that cites our Wye-Usk Transition Lab. Jyoti Banerjee says thank you, sets out what the paper argues and asks what it means for our own labs.
In September 2025, the European Investment Bank invited North Star Transition to Luxembourg. The EIB Institute was holding a one-day roundtable on water resilience, and I had the opportunity to present Wye-Usk Transition Lab as a case study of a new investment approaches.
The EIB has now published the white paper that came out of that day: Future-proofing Europe's water systems: From vision to investment. It names Wye-Usk in the executive summary, uses the lab as an example in two further sections, and lists our 2025 progress report in its references. Thank you, EIB. We at North Star Transition are grateful that the work we have been doing for the last four years or so has been written into the bank’s thinking. Of course, it goes without saying that the paper reflects everyone in that room, not only us.
So, what does the paper say?
The argument is straightforward. Europe does not lack capital for water. It lacks well-formed projects to put the capital into. The paper says the biggest obstacle is the way investments are originated, coordinated, funded and financed. The money exists. The pipeline is thin.
Four points follow from that.
Finance decides what gets built. Bankability tests favour large, capital-intensive assets and screen out nature-based and decentralised options before anyone looks at them. Readers of my previous blog on the challenges around water will recognise the pattern.
Resilience produces public goods, such as flood protection and ecosystem restoration. Water tariffs are not a good mechanism to pay for them.
European programmes fund either small pilots or large infrastructure. The catchment, where coordination does the most good, has no dedicated funding.
Trust is a condition, not a by-product. Shared data, neutral conveners and honest evidence decide whether public and private parties commit money.
It is great to see the EIB's own response to these challenges is a €15bn Water Resilience Programme for 2025 to 2027, which it expects will mobilise €30bn to €40bn of total investment. The paper asks the Bank, the Commission and others to fund the connecting work as well as the assets. That means setting missions, preparing projects, designing blended finance and convening people who do not usually sit together.
Where North Star Transition appears
The EIB white paper describes transition labs as "learning environments, governance mechanisms and investment pipelines all rolled into one." I have struggled to put it so neatly. It also repeats a figure from our 2025 report: coordinated planning across a catchment can cut costs by up to 30%.
I had many fruitful discussions on this with Mike Haigh, the former CEO of Mott MacDonald, the consulting engineers and North Star Transition’s partner for many years, who sadly passed away about eighteen months ago. Mike’s views certainly influenced us on this as he judged that a cross-sectoral approach could take a third off the cost of a project.
Affirmation from the Fens
About the time I met the EIB in 2025, North Star Transition had already launched Fens Transition Lab, our work that takes ideas from Wye-Usk Transition Lab and transplants the approach to the East of England. Fens Transition Lab, which has come out of the work of Future Fens: Integrated Adaptation, a cross-sectoral collaboration in the region, is working on the questions the EIB asks. What have we learned? Some of what we have found in our Fens work supports the white paper. Some of it asks the EIB to think again.
Where we agree: the origination of interventions is fragmented, and (if we are open about where the programme has got to) we have added to that fragmentation ourselves. Our work with farmers, landowners, drainage boards, water companies and regulators surfaced more than 200 possible interventions. We grouped them and wrote four viability studies: farming, nature-based solutions, farm reservoirs and water markets, and paludiculture. Each paper focused on how to make each idea package viable on its own. As a result, each study proposed its own coordinating body, and none referred to the others. That is the paper's diagnosis in miniature. Good origination, without coordination, produces four directions, not one.
What we are learning about funding also aligns with the EIB’s findings. The paper cites the Netherlands, where every citizen pays a water tax to the water boards. This exceptional set up provides stable long-term funding. Two of our viability studies also reference the need for long-tem stable funding, referencing the Dutch Delta Fund as an example. The instruments differ. The conclusion is the same: a dedicated, durable source of funding is superior to a run of project grants.
But the Fens work also seeks more nuance than is in the EIB white paper.
Funding and financing are different problems. The paper says the biggest obstacle is not a lack of finance. For investable projects, that fits what we see. For the Fens as a whole it needs a qualifier. The Case for Change set out by Fens 2100+ puts the investment needed for flood and water assets owned by the Environment Agency and the drainage boards at £6bn to £9.4bn, and says public finances alone cannot meet it. However, how can private finance get involved when embankments earn no revenue? We need to make a distinction between financing, who provides the capital, from funding, who ultimately pays. In the Fens the hard part is funding. A catchment layer has to find new payers before it finds new lenders and investors.
Another important and often overlooked element is trust. We have found that trust needs to be built from the ground up. The EIB white paper writes about trust between institutions. Our stakeholders told us that trust between farmers comes first. Clusters, co-operatives and shared reservoirs only work if neighbours will share water and data with each other. A convener can create the conditions. It cannot supply the trust.
Not everything is just about funding or finance. Our paludiculture viability study looked at construction crops grown on rewetted peat, such as reed and bulrush. The market is immature, and the gap is customers, not capital. It is a deal-sized opportunity that needs anchor buyers. This is a piece of the puzzle that is often missed. The EIB white paper's funding tools say little about building a market for a new product.
Farming is the dominant component of a rural economy. However, the EIB white paper treats agriculture mainly as a problem of the subsidy regime established in the Common Agricultural Policy (unsurprising given the European origin of the paper). But agriculture is not just a problem of subsidy. It's not something that can be tweaked. In the Fens, farming is where the region's economic value is made but also where it leaks out. Our analysis has to start with farm incomes and retained economic value. A resilient water system follows from this.
Bottom line
Perhaps, we should remain cautious about the lessons from the white paper. The EIB paper is a synthesis of a workshop, not a body of evidence on what works at scale. It also carries a warning from Mariana Mazzucato: concessional water finance can repeat the mistakes of climate finance, spending its effort on de-risking private capital while neglecting public benefit.
Mike Haig and I talked about the need for sandboxes, performance-based rules and whole-life costing. The EIB paper asks for regulatory sandboxes and performance-based oversight. A water engineer and a European bank reached the same place by different routes. I think that really helps us stay the course on our work. In the Fens, our next phase of work, which has already started, is bringing together the four separate viability studies and exploring how we can think strategically across the region. My hope is that origination will look a lot less fragmented as this work progresses.
The landscape, the catchment, is where finance, policy and landowners meet, but almost nobody pays for the work needed to understand that landscape and what it will take to change it. The EIB has now said so in print. Our task at North Star Transition over the next year is to show funders and investors what that layer returns in retained economic, social, human and natural capital value.
