Making biodiversity offsets work
Biodiversity offsets
Offsets are widely recognized by governments and business as legitimate tools for dealing with environment damage caused by development, particularly with land-hungry, high-impact developments, such as mining and large scale property development.
The concept of offsetting is based in a strictly rational approach to land-use management and conservation. There is generally common interpretation of what an 'offset' should be: Ie. an action that 'balances' or 'compensates' the negative consequences of a development. The concept fits neatly in with the contemporary understanding of sustainable development - one where economic development is somehow balanced with nature conservation.
Most jurisdictions also agree when offsets should be used: namely: after avoidance and mitigation measures have been exhausted; really as a last resort. However, they are increasingly being used as the go-to strategy, with less effort placed on avoidance and mitigation.
As always, the devil is in the detail. In an ideal world, offset schemes would compensate for the last vestiges of impact from a proposed development. However, these is concern offsets are all too easily being used as front-line conditional measures, rather than last resorts, and as political - or rhetorical - tools to appease community concerns over development.
A case study: Abbot Point coal terminal
Australia's Great Barrier Reef is under increasing stress from coastal development, agricultural run-off and the existential threats of global warming and ocean acidification.
The plight of the reef has been subject to significant political disagreement. This has fueled debate around the future of coal mining and coal exports. Both state and federal governments are keen to expand coal export facilities to ensure the efficient supply of coal to the world's markets. Not surprisingly, this industrialization of the Great Barrier Reef World Heritage area is has become a battleground with big resource companies and the governments that earn revenue from them on one side and activists on the other.
Offsets to the rescue
The offset approach has been infamously used by the Queensland government to justify its approval for the disposal of 5 millions tons of dredge spoil in the World Heritage Area as part of a proposed expansion of the Abbot Point coal terminal in north Queensland.
The approving Minister was (rightly) able to point to a significant number of conditions of approval to mitigate impacts, such as the timing of the dumping and the requirement for wildlife spotters on dredging ships. But in addition, the Minister was able to cite a required 'offset plan' that would not only reduce remaining impacts (ie. dredge spoil), but actually even improve the water quality by demanding a plan for a 150% reduction in sediment flowing out of the nearby Burdekin River.
You can't argue with that... The approval for the dumping of dredge spoil in the Great Barrier Reef Marine Park will actually lead to an improvement in reef water quality. The copywriters at the Ministry of Truth would have been proud.
If it was only that easy
Reef water quality has been on the political radar for a number of years. In the 15 years of the government's Reef Plan program and more than $300m, the total amount of sediment flowing into the Great Barrier Reef lagoon has been reduced by 350,000 tonnes per year. This is has been a mammoth effort; at significant cost.
But to put this in some context, the Burdekin River exports 4.7 million tonnes of sediment each year alone. The Abbot Point coal terminal conditions of approval demand a 150% improvement in water quality on the 5 million tonnes exported from the dredging, equating - presumably - to a 7.5 million tonne reduction in sediment flowing from the Burdekin River.
This is patently nonsense. It is unfeasible the proponent could completely clean-up the Burdekin basin by way of achieving 20 times the sediment reduction Reef Plan has managed. And let's not mention the seeming logical impossibility of removing more sediment from the river than actually flows down it!
Basic biodiversity offset
At its simplest a biodiversity offset is quite straightforward. In any project proposal, once environmental impacts have been avoided, then mitigated, any remaining impacts can be 'offset' by undertaking beneficial activities of at least equal to the 'values' of the disturbed area in an alternative place.
In this series of examples, we use a proposal for a development on an area of high conservation values.
Project area
Project area
Offset area
Offset area
Perceived outcome
There is no net loss of habitat. Economic development has been successfully 'balanced' with biodiversity conservation.
Actual outcome
There has been at least a temporary net loss in environmental values. Unless very well-managed, there is likely a permanent loss of flora and fauna during any transition phase.
Now add a sweetner
To further improve the perception of the efficacy of environment offsets, a greater amount of offset area is demanded by conditions. For example, the proposed Alpha coal mine, west of Rockhampton in Australia will destroy approximately half of the 8,000 hectare Bimblebox Nature Reserve, home to vulnerable species, such as the Greater Bilby. As compensation, the mining proponent must acquire 10,000 hectares of habitat to offset the loss and pay $100,000 per year into a conservation fund.
Project area
Project area
Offset area
Offset area
Perceived outcome
A net gain in primary production; conditions demand equivalent or higher ecological value replacement; potential additional external benefits, such as carbon sequestration, protected areas, open space. Economic development provides improvements to environmental outcomes. You can't argue with that!
Actual outcome
The same outcome as before; at best a temporary net loss in environmental values but unless very well-managed, there is likely a permanent loss of flora and fauna during any transplantation.
In reality, this often happens
In many cases involving land-use changes, the offset area is not a cleared or debilitated area but a previously unprotected, uncleared area. It is assumed at some point in the future this unprotected area would have been subject to clearing and 'improvement'.
Project area
Project area
Offset area unprotected
Offset area now protected
Perceived outcome
At least no net loss of biological diversity and conservation values. If the offset is larger, potential gains.
Actual outcome
In reality, this fails the additionality test. It cannot necessarily be established the unperturbed, unprotected offset area would ever have been cleared. Therefore, all things being equal, there is a net loss biodiversity conservation.
There is always at least a temporary net loss
Even in offset schemes that attempt to rehabilitate previously degraded land, there is always a considerable lag during which time fauna particularly suffers. Some vulnerable species such as the Bilby require bushland that is intensively managed and protected from feral species. Other species, such as koalas, are territorial and suffer considerable stress when being forced-migrated into areas already occupied, which are also likely to be at carrying capacity.
Project area
Project area
Project area
Offset area
Offset area
Offset area
Perceived outcome
At least no net loss of biological diversity and conservation values. If the offset is larger, potential gains.
Actual outcome
For new or regenerated offsets there is always a time lag between the clearing of the project area and the offset area reaching any where near maturity. Therefore there is a temporary loss of primary production and a [likely] permanent loss of biodiversity.
And it gets worse
The now protected offset area remains fair game for future development. Just because it is protected today, there is no guarantee it is protected in perpetuity. Indeed the Bimblebox Nature Refuge was secured by the Federal government directly as part of the National Reserve System, but has subsequently seem the approval of the Alpha coal project take more than half the original protected area.
Project area
Project area
Original offset area
Offset area
Offset protected
New offset area
Perceived outcome
At least no net loss of biological diversity and conservation values. If the offset is larger, potential gains. We have all forgotten that the new offset area was originally protected as an offset area.
Actual outcome
It is not established that the previous unperturbed unprotected area would ever have been cleared. Therefore, all things being equal, there is a net loss of biodiversity. The now protected area remains 'fair game' for future development proposals. There is no perpetual protection covenants available.
Are offsets ecologically equivalent
It is possible but not always the case that the offset area is ecologically equivalent (in the case of existing habitat) or capable (in the case of regenerated habitat) of supportig the biota of the original project area.
Project area
Project area
Offset area
Offset area
Perceived outcome
Like-for-like offset ('trees-for-trees') and economic expansion. The most visible aspect of the offsets project is the protected or the regenerated habitat. The more subtle impacts of loss of biodiversity, such as the loss of rare, furtive or uncharismatic species, are largely hidden from public percepetion.
Actual outcome
The project area is rapidly cleared; there is a net loss of biodiversity that likely cannot be ever be recovered.
Non-equivalent, fragmented offsets
A further risk is that offset areas are fragmented, restricting natural movements of fauna, genetic mixing and ecological resilience.
Project area
Project area
Project area
Offset area
Offset protected
New offset area
Perceived outcome
Like-for-like offset ('trees-for-trees') and economic developement. The most visible aspect of the offsets project is the protected or the regenerated habitat. The more subtle impacts of loss of biodiversity, such as the loss of rare, furtive or uncharismatic species, are largely hidden from public percepetion.
Actual outcome
Fragmented offset areas do not provide the equivalent conservation values of contiguous habitat. It is likely that, unless very well managed, there will be loss of fauna.
Lack of enforcement
Many offset programs take many years to mature, putting the area at risk of lack of oversight, insufficient funding or simple neglect on behalf of environmental regulators. Offsets are poltical tools, which once past their 'use-by' date can be discarded.
Project area
Project area
Project area
Offset area
Offset protected
New offset area
Perceived outcome
Like-for-like offset ('trees-for-trees') and economic developement. The most visible aspect of the offsets project is the protected or the regenerated habitat. The more subtle impacts of loss of biodiversity, such as the loss of rare, furtive or uncharismatic species, are largely hidden from public percepetion.
Actual outcome
The offset area, poorly managed and not-monitored, deteriorates slowly, losing both primary productive value and biodiversity values, due to lack of oversight or wilful political neglect. The public interest waned a long time ago and the area is likely to be identified as of poor value and available for future development.
An offset scheme requires forward planning and perseverance
To be effective any offsets area needs to have significant lead time (10-50 years, depending on habitat), be ecologically appropriate, protected in perpetuity and be actively managed to ensure the biodivserity is adequately transfused and invasive species and disturbances are mitigated and repaired. Only once these conditions have been met and the offset is deemed approved, should the project be given final approval to proceed.
In reality, this will NEVER happen.
Project area
Project area
Project area
Offset area
Offset protected and growing
Offset area protected
Perceived outcome
Like-for-like offset ('trees-for-trees') and economic developement. The most visible aspect of the offsets project is the protected or the regenerated habitat. The more subtle impacts of loss of biodiversity, such as the loss of rare, furtive or uncharismatic species, are largely hidden from public percepetion.
Actual outcome
The offset area, poorly managed and not-monitored, deteriorates slowly, losing both primary productive value and biodiversity values, due to lack of oversight or wilful political neglect. The public interest waned a long time ago and the area is likely to be identified as of poor value and available for future development.
Are biodiversity offsets flawed?
Environmental offsets are a minefield, even when attempts are being made implement them appropriately. Modern capitalism cannot operate with the necessary time lags required for proper ecological recovery through environmental offsets. Developers are already squeezing governments to improve approval times (they call it 'cutting green tape'). Expecting developers, miners and today's governments to accept 20-year lead times is simply unfeasible.
So in the meantime, they are the best we have - but caution is required to ensure they are used as conditions of last - not first - resort. Clearly, in the Abbot Point case, they were not. The dredge spoil could have been environmentally managed terrestrially, or behind bund walls. These options were n0t considered, solely down to costs.
A general community understanding of the pitfalls of offsetting would be useful, but again, in the short term, unfeasible. People wouldn't generally have the time or inclination to understand (they too, might benefit from such a scheme in the future). However, broader education among community groups would better enable them to hold government to account in appropriate use of offsets and in securing enforcement over the considerable periods of time required.