Biodiversity Offsets

Biodiversity Offsets

Effective Design and Implementation You do not have access to this content

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07 Dec 2016
9789264222519 (PDF) ;9789264222458(print)

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This report examines the key design and implementation features that need to be considered to ensure that biodiversity offset programmes are environmentally effective, economically efficient, and distributionally equitable. Biodiversity offsets are being increasingly used in a wide range of sectors as a mechanism to help compensate for the adverse effects caused by development projects in a variety of ecosystems. In this report, insights and lessons learned are drawn from more than 40 case studies from around the world, with an additional 3 in-depth country case studies from the United States, Germany and Mexico.

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  • Foreword

    Biodiversity loss is one of the major environmental challenges facing humankind today. Despite the invaluable benefits provided by biodiversity and associated ecosystems, current and projected trends show continued decline. It is widely acknowledged that concerted policy efforts will be needed to reverse these trends. The aim of this volume is to provide policy makers and practitioners with good practice insights on how to effectively design and implement one particular instrument that has recently been gaining traction from governments and business alike, namely biodiversity offsets. Typically undertaken as the last step in the mitigation hierarchy (i.e. avoid, minimise and then offset loss), successful biodiversity offset programmes are those that are environmentally effective, economically efficient and distributionally equitable.

  • Acronyms and abbreviations
  • Executive summary

    Current and projected trends in global biodiversity suggest further decline under business-as-usual scenarios. It is widely acknowledged that renewed efforts are needed to halt and reverse this trend. Governments must seek to reinforce and scale up instruments for biodiversity conservation and sustainable use, and to make existing instruments more environmentally and cost effective. One instrument that has recently been receiving increasing attention from policy makers and business alike is biodiversity offsets.

  • Biodiversity offsets: Overview and insights for good practice

    Biodiversity offsets are economic instruments used to allow for some continued economic development whilst simultaneously delivering biodiversity objectives, such as no net loss or net gain. This chapter discusses the role of biodiversity offsets in the broader policy framework for the conservation and sustainable use of biodiversity, summarises their scale and scope, and highlights some important environmental and social safeguards relevant to their use. Drawing on insights from more than 40 case studies of biodiversity offset programmes worldwide, the chapter concludes with good practice insights for their effective design and implementation.

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  • Expand / Collapse Hide / Show all Abstracts Key design and implementation issues

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    • No net loss, the mitigation hierarchy and the economics of biodiversity offsets

      Biodiversity offsets are used in project planning processes as a mechanism to help compensate for the biodiversity loss caused by development projects. Offset programmes most commonly seek to deliver a neutral outcome on biodiversity from development projects, or no net loss of biodiversity, though some have adopted a more ambitious goal of delivering a positive outcome, or net gain, for biodiversity. Biodiversity offsets are typically only used to deliver compensation for the residual impacts on biodiversity after measures have first been taken to avoid, minimise and then restore adverse impacts on biodiversity at the development site (i.e. the mitigation hierarchy). Biodiversity offsets may be implemented using one-off offsets, biobanks or payments in-lieu. The economics of offsets is also described.

    • Institutional frameworks for biodiversity offsets

      This chapter examines the institutional drivers that cause development firms to implement biodiversity offsets. Developers may undertake offsets to comply with a jurisdiction’s legislation, as a condition of project lending approval or as part of a voluntary corporate risk management strategy. The institutional frameworks that facilitate biodiversity offsets affect outcomes in each of the environmental, economic and distributional domains. The chapter concludes by contrasting the characteristic outcomes from implementing biodiversity offsets under different institutional frameworks.

    • Design and implementation features of biodiversity offset programmes

      The design and implementation features of biodiversity offset programmes are critical determinants of environmental effectiveness, cost effectiveness and distributional outcomes. This chapter reviews and discusses some of the key considerations including thresholds and coverage; equivalence; additionality and permanence; robust monitoring frameworks; and compliance and enforcement, as well as transaction costs.

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  • Expand / Collapse Hide / Show all Abstracts Case studies

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    • Compensatory mitigation and wetland banking in the United States

      Established in the 1970s, the Compensatory Mitigation and Wetland Banking programme in the United States is the largest and longest running offsets programme in the world. It protects the waters of the United States by requiring developers to follow the mitigation hierarchy when proposed development projects cause adverse impacts for wetlands and streams. Implementation of the Compensatory Mitigation programme is characterised by strong participation of the private sector in supplying offsets in a market driven context. This chapter summarises the evolution of the Compensatory Wetlands Mitigation programme over its 40 years of implementation. It discusses the challenges faced in the design and implementation of the programme – including in the progression of mitigation banking – how they have been addressed, and concludes with the key lessons learned.

    • German Impact Mitigation Regulation in Hessen

      Compensation for development-related biodiversity loss in Germany has been required since the 1970s, making it one of the longest running offsets programmes in the world. Compensation measures were originally carried out by the developing firm itself and were required to maintain strong links between the biodiversity lost through the development project and the compensation. This approach led to highly fragmented and costly offsets and caused the system of compensation to be reformed. The resultant Impact Mitgation Regulations are the foundation for the German biodiversity compensation system. The reforms relaxed the requirements regarding spatial, temporal and functional coherence with the objective of improving biodiversity outcomes and streamlining the compensation process. This chapter reviews the progression of German Impact Mitigation Regulations with a focus on the federal state of Hessen. It summarises the design and implementation features of the programme – including the important public sector role in biobanking – and concludes with insights and key lessons learned from the Hessian experience.

    • Mexican Environmental Compensation Scheme for Land-Use Change in Forested Areas

      The Environmental Compensation for Land-Use Change in Forested Areas Program is an important tool in Mexico for incorporating the value of biodiversity into development projects. Introduced in 2003, it is a compensation programme whereby developers causing biodiversity loss in forested areas are charged an in-lieu fee which is paid into the Mexican Forest Fund, managed by the National Forestry Commission. The fees are then used by the commission to carry out the compensatory restoration activities. This chapter reviews the design and implementation features of the Compensation for Land-Use Change in Forested Areas Program. It discusses the key reforms to the programme over its ten years of implementation, the lessons learned and concludes with a discussion of the challenges and opportunities that exist for the future of the programme.

    • Annex II.A1. Summary of offset features in Germany, Mexico and the United States
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