Biodiversity Banking


How can we appropriate land for human uses without reducing biodiversity?

The impact by human structures and activities on biodiversity in one area of land, can be offset (made up for) by building up biodiversity in another area, either through cultivation of appropriate plant and other species in an area set aside for this, or simply by withdrawing human activity from an area and allowing nature to reclaim it.

Taking land that supports native species and converting it to agriculture and urban uses (roads, buildings, gardens) reduces biodiversity. This impact can be offset by converting land back to the support of native species, and by enhancing the biodiversity of land already devoted to native species (eg through careful management).

However, paying land owners to convert land back for use by native species may reward those who cleared the land of native species in the first place, and doesn't reward those who refrained from clearing, preferring to keep some of their land in a natural state.

A fairer system would pay land owners to maintain land in a natural state, indeed to enhance the capacity of such land to support a diverse range of native species, especially endangered species. The prospect of securing income from cultivating biodiversity would act as an incentive for investment, eg to restore native habitats on cleared or degraded land.

To raise the money to pay land owners to cultivate native species, a levy could be charged on those converting land from natural uses, and/or on those who maintain land in a non-natural state, that is, who alienate the land from natural uses. Charging those who clear land, and not charging those benefiting from already cleared land isn't entirely fair; charging for having cleared land spreads the burden more fairly, although recent buyers of cleared land will be faced with costs that they did not anticipate - such is the problem of retrospective charges. On the other hand, reducing the fee for future land clearing will encourage the practice.


Compensating Nature

Compensating Nature for Loss of Land and Water Resources. Michael Robertson. Urban Ecology Australia. 2004.8

Over the last two centuries, more and more land and water has been diverted from natural ecosystems for human use. But can humans compensate for this? Without simply returning to nature all land and water currently diverted, can we make up for the loss by maximising the value to nature of the land and water that remain to its use?


Biodiversity Certification and Banking

Biodiversity Certification and Biodiversity Banking. Nature Conservation Council of NSW

The NSW Department of Environment and Conservation has recently launched the new system under which planning for threatened species will be managed within urban areas of NSW.

Biodiversity Certification and Biodiversity Banking propose a market based approach to conservation of threatened species on private land. The model aims to provide land holders with financial incentives to ‘maintain or improve’ the biodiversity values in the area and offset any losses that may occur as a result of the development process.

Biodiversity Banking Scheme

Biodiversity Banking Scheme. Environment and Conservation, NSW

Threatened species will become a valuable market asset in the near future, with a new Biodiversity Banking Scheme.

This new approach will protect threatened species, conserve biodiversity and streamline the development approval process to meet housing and employment needs in high growth areas.

The new approach will:

Encourage private landholders to conserve biodiversity on their land, where management actions to improve biodiversity values in perpetuity will count towards the generation of 'biodiversity credits'.

Identify areas where biodiversity values are too important to use an offset approach.

Identify areas where developers will need to use offsets to maintain or improve biodiversity, where it may be lost during development.

Establish a new rule based assessment methodology to determine how much offset is required.

Allow developers to meet offset requirements by purchasing biodiversity credits.

The Department of Environment and Conservation will develop and administer the scheme and ensure compliance with the scheme rules.

Biodiversity Certification and Banking

NSW Threatened Species Legislation – Biodiversity Certification and Banking. Paul Lalich & Suzanne Westgate, Allens Arthur Robinson, August 2005

The scheme proposes to use economic tools to offset the impact of development through a tradeable credit system. While such offsets are not new, the Amendment Act now provides the legislative framework for a biodiversity certification and banking system on a state-wide basis.

The biodiversity values within each region of NSW are to be determined by the DEC using satellite imagery and fieldwork that will identify 'green light', 'amber light' and 'red light' areas. Areas of low biodiversity value with no threatened species requirements will be 'green light' areas, on which development may be fast-tracked and no offsets required. Areas of medium biodiversity values will be classified as 'amber light', in which environmental offsets may be used in order to 'maintain or improve' biodiversity values. Areas of high biodiversity values that are targeted for restoration investment will be classified as 'red light'.

DEC proposes that Regional Conservation Plans (RCPs) will then be developed through a process of public consultation to identify the 'green light', 'amber light' or 'red light' zones in each region. RCPs will then be approved by the Minister and included in the Government's regional strategies. Under the provisions of the Amendment Act, the Minister will be under an obligation to consider the social and economic consequences of such RCPs.

Biodiversity certification

The successful implementation of the scheme will be dependant on support from local councils as councils will need to amend Local Environmental Plans (LEPs) or other environmental planning instruments (EPIs) to be compatible with the relevant RCP. Once an LEP or EPI has been amended, it can then be submitted to the Minister to achieve 'biodiversity certification'. One of the benefits of carrying out activities in an area for which there is a biodiversity certified LEP or EPI is that an application for development consent in a green light area will not need to include a separate species impact statement.

The proposed scheme also suggests a zoning strategy for green, amber and red light areas to be implemented in LEPs. For example, 'Green light areas' are intended to be residential, business or industrial, whereas for 'red light areas', the suggested zoning is environmental protection.

Biodiversity banking

The proposed biodiversity banking scheme will facilitate the process of 'offsetting' impacts on biodiversity as part of the development consent process.

It is proposed that the banking scheme will include a methodology to quantify 'offsets'. Resources will be pooled in a 'biodiversity bank' to broker the exchange of credits between conservation estate owners and developers. For example, holders of land with significant conservation value (ie in red light areas) could generate offset credits that may be onsold to a proponent of a development in an amber-light area that may have a negative impact on biodiversity.

Land holders in red light areas will have financial incentives to maintain and conserve the ecological value of their land through the biodiversity banking scheme through conservation agreements and funding provided from the 'bank', to which credits generated from the high biodiversity value of the land may be sold.

Importantly, there are tax advantages available for some 'offsets', including voluntary conservation agreements and the purchase of areas with high conservation values.

The Government proposes that the biodiversity banking scheme will be more efficient for developers by streamlining the assessment of development in NSW, more transparent for the community, will improve biodiversity values and deliver better conservation outcomes.

Biodiversity Banking and Threatened Species

Biodiversity Bank Comes under Fire. Tim Dick. Sydney Morning Herald. 2005.8.5

The State Government's new "biodiversity banking" plan will fail in its mission to protect threatened species unless serious gaps are plugged, environmental groups have cautioned.

The State Government's "bio-bank" will allow developers to clear sensitive habitats, provided they pay to conserve others.

A two-year trial of the scheme will begin next year in the Lower Hunter and Far North Coast.

Regional plans will divide the areas, which are under serious development pressure, into three zones - green, amber and red.

Green symbolises areas of little biodiversity importance, amber zones have some important habitats, while red zones have many. Developments in amber zones can go ahead if credits are bought from the bio-bank, which will fund conservation projects.

"The colouring system is bizarre because it turns everything on its head," said a senior lecturer at the University of Sydney, Dr Phil McManus.

"The whole thing is based on development. It's really about the further commodification of nature, the idea that we sell nature to save it."

He said priority should be given to preserving the habitat, with offsets only considered where this had been proved to be impossible, such as coastal areas with high property prices.

"At this stage we can't say the idea's great or anything because there's so much missing from it."

The Nature Conservation Council's director, Cate Faehrmann, called for a rethink. "We could have the situation where an area of land containing threatened species has to be destroyed to save threatened species in another place altogether," she said.

The Total Environment Centre's Jeff Angel said the plan was heading in the necessary direction because "we have to turn our focus to private land. But it's in nowhere near an acceptable state to be implemented yet".

The plan has won support from the NSW Urban Taskforce, a developers' lobby group, which dubbed it a "breakthrough strategy" to resolve conflicts between conservation and development.

Biodiversity Banking for Coastal Housing Development

Money in the Bio-Bank. Editorial. Sydney Morning Herald. 2005.8.6

Up and down the coast, real estate agents' windows are full of properties for sale. The demand for coastal housing is growing apace, and developers are rushing to satisfy it. Land - particularly by the water - is hot property. But the prices being paid take little account of the environmental cost of development. The State Government wants to ensure developers pay more of it. A biodiversity banking scheme is to be tested on the North Coast in which developers can proceed with projects which destroy valuable habitat if they buy credits from a biodiversity bank so similar habitat elsewhere is preserved.

Green groups have their doubts. Will the habitat to be preserved really compensate for that which is lost? Say a piece of coastal property of conservation value is to be developed. Is it enough to set aside land kilometres away, possibly inland, to offset it? Clearly not. The Government says offset projects will preserve habitat like-for-like or better. The words "or better" in these Orwellian days have an ominous ring. Who says they are better?

There is a broader concern, too. When the market places a dollar value on it, habitat becomes a commodity to be used like any other. A developer pays to preserve habitat here to gain permission to destroy it there. As with carbon credits and other market-based processes intended to control pollution, the system risks not giving enough encouragement to eliminating the damage altogether. We do not ask: can we preserve both? We ask: what will we have to pay so we can destroy one? And as a result we lose something valuable without trying especially hard to save it.

That criticism has force, without a doubt, but it is a counsel of perfection. Ideally all valuable habitat would be untouchable, but the world is not ideal. The bio-bank scheme is possibly not ideal. The two-year trial must be monitored to ensure it achieves what it is intended to achieve, so it is not just a sop to greenies and a camouflage for developers. But it is a worthwhile attempt to address a serious problem in an intelligent way. It deserves support.