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Biodiversity banking
editBiodiversity banking, also known as biodiversity trading, conservation banking, mitigation banking,[1] habitat banking, compensatory habitat,[1] or set-asides,[1] describes a market-based framework for biodiversity offsetting where offsets can be traded in the form of credits to offset negative environmental impacts of development projects or activities. This involves biodiversity banks, areas with biodiversity value.[2] On the site of a biodiversity bank, conservation activities may be carried out to preserve, restore, enhance, or conserve biodiversity.[3][4] The outcomes of projects carried out at biodiversity banks are valued in the form of credits, which can be purchased as a way to offset unavoidable adverse environmental impacts, often with the aim of achieving no net loss of biodiversity.[5]
Biodiversity banking emerged from wetland mitigation banking in the United States, beginning in the 1980s and arising from the no net loss policies developed with the Clean Water Act in the 1970s.[6] Since then the concept has been extended, including its application to the bond market.[7][8]
The terms used to describe biodiversity banking are dependent on the focus of conservation aims and the policies of the country or region in which it is applied.[9] Some of the countries where biodiversity banking has been implemented include the United States, Australia, Canada, Brazil, and Colombia.[10]
Terminology
editBiodiversity banking is distinct from biodiversity offsets, though they are closely related. Biodiversity offsets are measurable conservation outcomes that result from actions to compensate for the significant negative impacts of development projects, once appropriate measures to avoid or minimise these impacts have been taken.[11] Biodiversity offsetting and biodiversity banking are commonly applied with the goal of achieving no net loss of biodiversity, or more ambitiously, a net gain of biodiversity.[12]
Biodiversity banking generally turns offsets into assets that can be stored or traded, through the creation of biodiversity credits that quantify the value of projects undertaken to restore, create, or enhance biodiversity away from a potential development site.[13][14] The sites where these projects are carried out are referred as banks.[14] While many countries have developed requirements for biodiversity offsetting,[15] frameworks for biodiversity banking are less widespread.
The terms used to describe biodiversity banking differ according to the biodiversity that the system aims to conserve. For example, habitat banking, species banking, conservation banking, and mitigation banking are forms of biodiversity banking:
| Type of banking | Definition | Related terms |
|---|---|---|
| Biodiversity banking | A market where the credits from actions with beneficial biodiversity outcomes can be purchased to offset the debit from environmental damage. | |
| Habitat banking | ||
| Species banking | ||
| Conservation bank | A parcel of land managed for its conservation values. In exchange for permanently protecting the land, the bank owner is allowed to sell credits to parties who need them to satisfy legal requirements for compensating environmental impacts of development projects. | |
| Mitigation banking | A site (suite of suites) where biodiversity is preserved, enhanced, restored, or created to address significant negative impacts on biodiversity that remain once efforts have been made either to avoid or minimise these impacts, enacted in advance of proposed development projects. | Habitat banking, species banking |
Background
editBiodiversity banking emerged from mitigation banking policy in the United States. Since then, biodiversity banking has been expanded and applied outside of the United States in various forms.
In practice
editAustralia
editAt least two biodiversity banking schemes have been set up in Australia as a framework for biodiversity offsetting, required under the federal Environment Protection and Biodiversity Conservation Act and state guidelines for offsetting. Biodiversity banks were established on the state level with separate schemes in New South Wales and Victoria, based on regulations from the state government.[16] For example, New South Wales' now defunct BioBanking Scheme set up in 2008 and the BushBroker scheme in Victoria.
BioBanking in New South Wales
editThe BioBanking ('Biodiversity Banking and Offsets') scheme in New South Wales started in July 2008 with the aim of achieving no net loss (or a net gain) of biodiversity [17] but has since been replaced by a 'Biodiversity Offsets Scheme'. BioBanking was run by the state government's Department of Environment and Climate Change as a voluntary market for biodiversity credits that could be applied as part of the planning process. Credits were created by landowners by establishing "biobanks" sites where they committed to conserving biodiversity. The credits represented improvement in biodiversity through conservation activities at the site and could be sold by the landowner for income and to fund the continued management of the biobank. The biodiversity credits under the system included ecosystem credits and species credits.
Native Vegetation Management in Victoria
editIn Victoria, the clearing of native vegetation is regulated under the Native Vegetation Management Framework with the aim of no net loss of biodiversity. To regulate vegetation clearing, the BushBroker biodiversity banking scheme was set up in 2006.
Brazil
editCanada
editUnder the Fisheries Act, habitat banking has been implemented in Canada since 1993, when the first project at Fraser Port in Vancouver was started to offset the impacts of the port on fish and their habitat. Creation, restoration, and enhancement of habitat has continued at Port Fraser since then. Creation, restoration, and enhancement projects have covered 15 hectares of fish and wildlife habitat since 2012, according to the Port Authority, and have been used to offset the effects of port development.
In Canada, habitat banking is a tool used to offset negative impacts of potential projects or development activities on fish (or their habitats), in advance of impact occurrence, by restoring, enhancing, or creating fish habitat by completing conservation projects. The positive impacts of these conservation projects on fish are quantified through habitat credits that can be issued by the Minister for Fisheries, Oceans, and the Canadian Coast Guard. Habitat credits can then be withdrawn from the habitat bank to offset negative impacts on fish or their habitats, but only by the creator of the habitat bank to offset their own impacts - the credits cannot be sold or traded to third parties. In addition, projects must adhere to the mitigation hierarchy to be eligible to use habitat credits.
Further research is needed to determine a clear picture of the success of habitat banking in achieving no net loss of biodiversity and ecosystem functions in Canada. A 2006 analysis found that 25% of habitat banking projects achieved no net loss of habitat productivity, while 12% achieved a net gain. Compliance with monitoring requirements was also found to be low, meaning it was difficult to determine the effectiveness of projects in achieving no net loss.
Colombia
editIn the form of habitat banks (Spanish: los bancos de hábitat), biodiversity banking has been implemented in Colombia since 2016, when the first habitat banks were piloted there.[18] By August 2022, at least 10 habitat banks had been registered in the country.[18] A desire to address the deficit in funds to implement the National Biodiversity Strategy was a motivation for promoting the development of habitat banks in the country.[19]
The regulations were released by the Ministry of Environment and Sustainable Development in June 2017 under Resolution No. 1051 and updated in 2018 by Resolution No. 256.[20] Habitat banking is allowed as a mechanism for offsetting. Each biodiversity credit is worth 1 hectare of restored land in a habitat bank.[18]
Japan
editUnited States
editMitigation banking
editConservation banking
editControversy
editThe use of biodiversity banks is controversial.
- Assigning value to biodiversity is challenging and this is controversial
Debate also surrounds terminology when referring to biodiversity banks.
References
edit- ^ a b c Gibbons, Philip; Lindenmayer, David (2007). "Offsets for land clearing: No net loss or the tail wagging the dog?". Ecological Management and Restoration. 8 (1): 26–31. Bibcode:2007EcoMR...8...26G. doi:10.1111/j.1442-8903.2007.00328.x.
- ^ "A Guide to Biodiversity Banking | Ecology by Design". | Ecology by Design. 2022-01-10. Retrieved 2024-07-26.
- ^ Mackie, Harriet (2024-02-05). "Habitat Banks - Definition, Creation and List of Types". Gaia. Retrieved 2024-07-26.
- ^ US EPA, OW (2015-06-16). "Mitigation Banks under CWA Section 404". www.epa.gov. Retrieved 2024-07-26.
- ^ Kumaraswamy, S.; Udayakumar, M. (2011-06-01). "Biodiversity banking: a strategic conservation mechanism". Biodiversity and Conservation. 20 (6): 1155–1165. doi:10.1007/s10531-011-0020-5. ISSN 1572-9710.
- ^ "Biodiversity Banking: A Primer". Ecosystem Marketplace. Retrieved 2024-07-26.
- ^ Sullivan, Sian (2018). "Bonding nature(s)?: Funds, financiers and values at the impact investing edge in environmental conservation". In Bracking, S.; Fredriksen, A.; Sullivan, S.; Woodhouse, P. (eds.). Valuing Development, Environment and Conservation: Creating Values That Matter. Routledge Explorations in Development Studies. pp. 99–121. doi:10.4324/9781315113463-6. ISBN 9781315113463.
- ^ Thompson, Benjamin S. (2023). "Impact investing in biodiversity conservation with bonds: An analysis of financial and environmental risk". Business Strategy and the Environment. 32 (1): 353–368. doi:10.1002/bse.3135. ISSN 0964-4733.
- ^ Froger, Géraldine; Ménard, Sophie; Méral, Philippe (2015-10-01). "Towards a comparative and critical analysis of biodiversity banks". Ecosystem Services. 15: 152–161. doi:10.1016/j.ecoser.2014.11.018. ISSN 2212-0416.
- ^ "Biodiversity Banking: A Primer". Ecosystem Marketplace. Retrieved 2024-07-26.
- ^ "BBOP Glossary". Forest Trends. 2012-06-29. Retrieved 2024-07-16.
- ^ "Biodiversity offsets". www.iucn.org. Retrieved 2024-07-19.
- ^ "Report: "The use of market-based instruments for biodiversity protection"". Management of Environmental Quality: An International Journal. 21 (5). 2010-08-10. doi:10.1108/meq.2010.08321eaf.001. ISSN 1477-7835.
- ^ a b Conservation and Ecosystem Services in the New biodiversity Economy. "CESINE Biodiversity Offsetting Policy Brief No. 1" (PDF). Department of Geography, University of Cambridge. Retrieved 2024-07-19.
- ^ Bull, Joseph William; Strange, Niels (2018-11-23). "The global extent of biodiversity offset implementation under no net loss policies". Nature Sustainability. 1 (12): 790–798. doi:10.1038/s41893-018-0176-z. ISSN 2398-9629.
- ^ Biodiversity Banking and Offsets Scheme (BioBanking) environment.nsw.gov.au
- ^ Burgin, Shelley (2008-04-01). "BioBanking: an environmental scientist's view of the role of biodiversity banking offsets in conservation". Biodiversity and Conservation. 17 (4): 807–816. doi:10.1007/s10531-008-9319-2. ISSN 1572-9710.
- ^ a b c "Policy brief | Habitat banking in Colombia: Preserving biodiversity and creating economic opportunities". BIOFIN. 2023-05-11. Retrieved 2024-07-25.
- ^ Quinchía, Alejandra Zapata (2024-07-15). "En Támesis, un predio ganadero se convirtió en banco de hábitat: hogar de fauna en vía de extinción". www.elcolombiano.com (in European Spanish). Retrieved 2024-07-25.
- ^ Ministerio de Ambiente y Desarrollo Sostenible (2018). "BANCOS DE HÁBITAT - Mecanismo para la implementación de compensaciones bióticas" (PDF). minambiente.gov. Retrieved 2024-07-25.