Michael Crowe

Biodiversity offsetting in Victoria

Biodiversity Offsets in Canada Conference

February 2014

Native Vegetation Controls

Year: 1788 to 2012

1989 – Initial regulation of native vegetation clearing • an end to large scale clearing

However offsetting was sporadic and not codified

1998 - Biodiversity mapping • Extant vegetation, 1750 vegetation, bioregions, threatened species

Provided state-wide information base

2002 - Policy - the Native Vegetation Management Framework • No net loss, like-for-like, metrics …..

However developers found it hard to find their offsets

2007 – Offset market based on credit trading • Third party suppliers, brokers, credit register

2013 – Some policy amendments and technical improvements

Evolution of Offsetting in Victoria

Regulation of native vegetation clearing:

• A planning permit required to clear native vegetation

• Assessment of permit applications based on the biodiversity significance of the impact

• Applications must demonstrate ‘avoid’ and ‘minimise’ steps of the mitigation hierarchy

• The permit (if granted) requires an offset

The Regulation

The nature and size of the offset was set by Native Vegetation

Management Framework policy (statutory document):

– Avoid, minimise, offset

– No Net Loss

– Quality/area metric - habitat hectares

– Offsets to be secure and ongoing

– Additionality

– Like for like rules

– Biodiversity importance

Offset policy in Victoria - 2002

No net loss – quality is important

Measuring site quality – 10 attributes in habitat hectares

increased cover of weeds

reduced recruitment

reduced cover of trees

reduced understorey

diversity

Habitat score = 0.50

Increased quality at the offset site

Habitat score = 0.90

tree canopy cover

logs & organic litter

large old

trees

understorey diversity

recruitment of young trees

size & connectivity of the patch

Total gain = area x quality increment/ha

• Improvement gain Increments in quality attribute scores resulting from

restoration actions (eg revegetation)

• Management gain Increments in quality attribute scores resulting from actions to

control threatening processes (eg pest & weed control)

• Security gain Increments in overall quality score depending on the changes

in land use (eg establish protected areas)

• Gain scoring includes rules for additionality

Estimating Gain

• The landowner agreement – private land

− permanent statutory contract − binds future landowners – on title − actions and commitments in the management plan − reporting and monitoring

• Land surrender − private land donated to a permanent protected area

• Upgrade to Protected Area − government re-classifies public land to higher security category through legislation

Secure and ongoing

Local Government

Determine small impacts

Developers

The offsetting process - summary

Loss site assessment, Permit application

Refer large impacts to

State Government

Permit may be granted Permit includes offset conditions – offset plan

Developers required to provide offsets

• first party • third party (market)

BushBroker price history

Bioregion Number of Agreements

Total number of Habitat

Hectares

Average price per Habitat

Hectare * (of total

Agreements)

Habitat Hectare price range *

(more than 80% of

Agreements) Central Victorian

Uplands 8 10 $110,000 $46,000 - $143,000

Gippsland Plain 21 29 $149,000 $85,000 - $250,000

Goldfields 39 38 $45,000 $25,000 - $66,000

Victorian Riverina 10 11 $101,000 $80,000 - $110,000

Victorian Volcanic Plain 29 54 $170,000 $49,000 -

$267,000

Highlands-Southern Fall 14 74 $34,000 $20,000 - $38,000

Other bioregions 11 25 $370,000 $206,000 - $380,000

• Third party offsets estimated 25-50% savings over first party • Estimated market turnover up to $100m

Prices vary by bioregion, EVC, location, rarity, demand and urgency of developer, landowner needs. Also initial trade, small or large trades

Offset market - credit prices

2013 Revisions

New provisions were recently announced: • Like for like Threatened species – distribution models Everything else – increased flexibility

• Use of maps for site assessment reduced transaction cost assessment consistency accuracy of maps?

• Transaction cost reduction more ‘over the counter’

mlacrowe@gmail.com

Biodiversity offsetting in Victoria

Thank you

Biodiversity offsets in Canada Conference