Biodiversity offsetting is based on the “explicit calculation of losses and gains at the impact and offset sites” (Carreras Gamarra et al., 2018, p. 36), with the objective of achieving the “no net loss” goal in biodiversity. Calculating losses and gains is a challenging task because the concept of biodiversity is broad and complex, encompassing compositional (e.g., richness, evenness), structural (e.g., age and sex ratios), and functional (e.g., productivity, energy flow) elements (Noss, 1990). Therefore, it is crucial to ensure that the methods, metrics, and measures used in the calculations are based on the best available science.
Kujala et al. (2015) suggest that applying principles of complementarity and irreplaceability in offset sites selection with the aid of spatial prioritization tools leads to more efficient identification of offset sites. This approach also results in improved biodiversity outcomes when compared to the more commonly used like-for-like approach.
Irreplaceability: irreplaceability refers to “how close a site is to being essential for achieving conservation targets” (Baisero, 2022, p. 1). By applying the concept of irreplaceability in biodiversity offsetting, threatened, rare, or irreplaceable biodiversity features could be prevented from being traded away in favor of more common ones (Kujala et al., 2015).
Complementarity: the principle of complementarity requires that selected offset sites complement existing protected areas in terms of their biodiversity features. The concept of complementarity can help identify areas that are best suited for adding underrepresented biodiversity features to the existing protected area network in a more efficient manner (Kujala et al., 2015). Therefore, applying the principle of complementarity can be a useful approach for achieving effective biodiversity conservation outcomes in offsetting schemes.
Kujala et al. (2015) also point out that a large number of freely available and widely used planning tools can be employed to implement complementarity and irreplaceability analyses in offset site selection. This is consistent with the general trend of ecological conservation planning moving towards an algorithmic approach. However, it is also important to note that, as Jones et al. (2022) suggest, it will always be necessary to verify the ecological suitability of a site through fieldwork.
Risks and Policy Responses
Mitigation banking, as the main form of biodiversity offsetting in the USA, is not free of risk. Levrel et al. (2017) identified eight categories of risks associated with mitigation banking. For example, the risk of spatial disconnection between impact and compensation sites is a major concern among researchers. Spatial disconnection occurs when offset sites selected are far from the impacts they are intended to compensate for. This is often due to the fact that mitigation banks are incentivized to choose locations where the cost of land is low, resulting in a concentration of offset sites in rural areas and a concentration of impacts in urban areas (Levrel et al., 2017).
The policy response to the risk of spatial disconnection of impact and compensation sites is to define service areas. These areas may include physiographic provinces, watersheds, ecoregions, and/or other geographic areas within which the mitigation bank is authorized to provide compensatory mitigation. The service areas should be appropriately sized to ensure that the aquatic resources provided will effectively compensate for adverse environmental impacts across the entire service area. This policy is stated in The Mitigation Rule (33 C.F.R. Part 332.8(6)(vi)(A)).
Another example is the risk of a lack of long-term management or the risk of bankruptcy. This could occur, for example, if the sponsor of a mitigation bank runs into financial distress and has to abandon a mitigation project. The policy response to this risk includes measures such as:
- A conservation easement, which is a voluntary legal agreement that permanently limits the uses of the land to protect its conservation values;
- Requiring the sponsor to create a long-term stewardship fund (Levrel et al., 2017).
Other types of risks and policy responses have also been discussed in detail. We refer interested readers to the full article for further information.
References:
Baisero, D., Schuster, R., & Plumptre, A. J. (2022). Redefining and mapping global irreplaceability. Conservation Biology, 36(2), 1–11. https://doi.org/10.1111/cobi.13806
Carreras Gamarra, M. J., Lassoie, J. P., & Milder, J. (2018). Accounting for no net loss: A critical assessment of biodiversity offsetting metrics and methods. Journal of Environmental Management, 220, 36–43. DOI: 10.1016/j.jenvman.2018.05.008
Kujala, H., Whitehead, A. L., Morris, W. K., & Wintle, B. A. (2015). Towards strategic offsetting of biodiversity loss using spatial prioritization concepts and tools: A case study on mining impacts in Australia. Biological Conservation, 192, 513–521. DOI: 10.1016/j.biocon.2015.08.017
Levrel, H., Scemama, P., Vaissière, A.-C. (2017). Should we Be wary of mitigation banking? Evidence regarding the risks associated with this wetland offset arrangement in Florida. Ecological Economics 135, 136–149. https://doi.org/10.1016/j.ecolecon.2016.12.025
Noss R.F. (1990). Indicators for monitoring biodiversity: a hierarchical approach, Conserv. Biol. 4, 355–364.
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