The Australian state of New South Wales completed its first biobanking agreement on May 17, 2010. The agreement placed 80 hectares of native vegetation into a permanent preserve in exchange for $1.7 million. This particular reserve includes 36 hectares of the critically endangered Cumberland Plain ecosystem, which is home to 17 threatened species.
Biobanking is one class of “ex situ conservation,” which seeks to compensate for environmental degradation in one place by improving or protecting the environment in another place. The method has been used in the U.S. since the 1970s for wetland mitigation. For example, if a road must be built through a wetland, then a comparable piece of wetland somewhere else needs to be protected or improved. The protected wetlands are in “mitigation banks” created by other landowners who are willing to maintain their lands as permanent, maintained wetlands in exchange for a financial payment. Many nations have similar limited programs for specific types of habitats or the habitats of endangered species.
The biobanking scheme in New South Wales was created by the Threatened Species Conservation Act of 1995, but it took many years to be implemented. It is a complex scheme with several significant elements. First, an assessment process was required that could evaluate a piece of ground and determine what biodiversity values were either being destroyed by its development or enhanced by its protection and maintenance. Biodiversity value relates to the composition, structure and function of ecosystems, a more comprehensive definition than is typically used in environmental assessments.
Second, sites need to be enrolled that become the lands to be protected or enhanced. In the first case in New South Wales, 80 hectares were enrolled by the Missionaries of the Sacred Heart, who own the site in southwest Sydney. Protecting urban lands, like those around Sydney, is particularly important in Australia, where development and high-priority environmental lands often overlap. The program now lists 83 land parcels that have enrolled, and the website lists 158 needs for additional lands to be enrolled.
Third, a market needs to be established that allows developers to buy “credits” from the protected lands. This is handled in New South Wales by the Ministry of Climate Change, Environment and Water. The market price includes two elements. First is a price for a trust fund that the government operates that uses investment returns to pay landowners for their annual costs of maintaining and improving the property. That trust fund currently has a $50 million balance. Second is a price for the value of the credits themselves, that the property owner can determine based on competition. In the case of the first New South Wales property listed, the trust fund cost was $555,000 and the value of the credits themselves was $1.1 million.
Although some conservationists feel such ex situ conservation schemes are inappropriate because they fail to protect all sites everywhere, most believe that this represents a positive step. It helps to put economic values on conservation so conservation can be compared to other land uses, and it engages private enterprise in the sustainability journey, a process that most experts believe is both desirable and inevitable. Expect more of this, not less.
Financial Review. 2010. NSW: BioBank scheme to reduce diversity, criticis say. Financial Review, May 17, 2010. Available at: http://www.afr.com/news/politics/nsw-biobank-scheme-to-reduce-diversity-critics-say-20100517-ivj8w. Accessed May 15, 2018.
NSW Environmental Trust. 2016. Annual Report, 2015-2106. Available at: http://www.environment.nsw.gov.au/resources/grants/160581-annual-report-2016-trust.pdf. Accessed May 15, 2018.
Rodricks, Sasha. 2010. Biodiversity banking and offset scheme of New South Wales (NSW), Australia. TEEBcase. Available at: http://img.teebweb.org/wp-content/uploads/2013/01/Biodiversity-Banking-and-Offset-scheme-New-South-Wales-Australia.pdf. Accessed May 15, 2018.
UNDP. Biodiversity Offsets. Available at: https://www.undp.org/content/sdfinance/en/home/solutions/biodiversity-offset.html. Accessed May 15, 2018.