Biodiversity Offsets: Effective Design and Implementation

227 Pages·2016·2.64 MB·English

by  Organization for Economic Cooperation and Development

Biodiversity Offsets
EffEctivE DEsign anD implEmEntatiOn
contents
Chapter 1. Biodiversity offsets: Overview and insights for good practice Biodiversity Offsets
Part I. Key design and implementation issues
EffEctivE DEsign anD implEmEntatiOn
Chapter 2. No net loss, the mitigation hierarchy and the economics
of biodiversity offsets
Chapter 3. Institutional frameworks for biodiversity offsets
Chapter 4. Design and implementation features of biodiversity offset programmes
part ii. case studies
Chapter 5. Compensatory mitigation and wetland banking in the United States
Chapter 6. German Impact Mitigation Regulation in Hessen
Chapter 7. Mexican Environmental Compensation Scheme for Land-Use B
Change in Forested Areas io
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Biodiversity Offsets
EFFECTIVE DESIGN AND IMPLEMENTATION
This work is published under the responsibility of the Secretary-General of the
OECD. The opinions expressed and arguments employed herein do not
necessarily reflect the official views of OECD member countries or those of the
European Union.
This document and any map included herein are without prejudice to the status
of or sovereignty over any territory, to the delimitation of international frontiers
and boundaries and to the name of any territory, city or area.
Please cite this publication as:
OECD (2016), Biodiversity Offsets: Effective Design and Implementation, OECD Publishing, Paris.
http://dx.doi.org/10.1787/9789264222519-en
ISBN 978-92-64-22245-8 (print)
ISBN 978-92-64-22251-9 (PDF)
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3
FOREWORD –

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.
This book, prepared under the oversight of the OECD Working Party on
Biodiversity, Water and Ecosystems, draws on the literature and on lessons
and insights from more than 40 case studies on biodiversity offsets
worldwide, including three in-depth chapters from the United States,
Germany and Mexico. It examines the opportunities, as well as the
challenges, that have been encountered with the design and implementation
of biodiversity offset programmes and how they may be addressed. The
following questions are examined:
 What are biodiversity offsets and how do they fit within the broader
framework of no net loss and the mitigation hierarchy?
 What are the key design and implementation features that need to be
considered to help ensure that biodiversity offsets are environmentally
effective?
 What are the lessons learned from existing biodiversity offset
programmes and what are the good practice insights for existing and
future programmes?
BIODIVERSITY OFFSETS: EFFECTIVE DESIGN AND IMPLEMENTATION © OECD 2016

5
ACKNOWLEDGEMENTS –

Acknowledgements
This publication has been prepared by the OECD Environment
Directorate under the oversight of the Working Party on Biodiversity, Water
and Ecosystems of the Environment Policy Committee. Participants to these
meetings provided valuable comments and suggestions throughout its
preparation.
This work has also benefited from the presentations and discussions at
the international expert workshop on biodiversity offsets which took place
on 6-7 November 2013, in Paris, France.
Chapters 1-4 of this report were prepared by Andrew O’Keefe (formerly
OECD) and Katia Karousakis (OECD). Chapter 5 on the US Compensatory
Mitigation programme was written by Morgan Robertson and Palmer Hough
(University of Wisconsin and United States Environmental Protection Agency,
respectively). Chapter 6 on Germany was drafted by Frank Wätzold and
Silvia Wissel (Brandenburg University of Technology and University of
Amsterdam, respectively). Chapter 7 on Mexico was written by Bernardo Lazo
(Ithaca Environmental). All chapters were overseen and edited by
Katia Karousakis. Jane Kynaston provided administrative support.
Jennifer Allain prepared the manuscript for publication. Comments and
feedback on this report were provided by Anthony Cox, Jane Ellis and
Simon Buckle (OECD) and notably, comments from delegates of the OECD
Working Party on Biodiversity, Water and Ecosystems are gratefully
acknowledged.
This document has been produced with the financial assistance of the
Netherlands, the European Union, Switzerland and the United Kingdom.
The views expressed herein can in no way be taken to reflect the official
opinion of the European Union.
BIODIVERSITY OFFSETS: EFFECTIVE DESIGN AND IMPLEMENTATION © OECD 2016

7
TABLE OF CONTENTS –

Table of contents
Acronyms and abbreviations ........................................................................................ 13
Executive summary ........................................................................................................ 15
Chapter 1. Biodiversity offsets: Overview and insights for good practice ................. 19
Biodiversity: An invisible – yet invaluable – life support system ................................ 20
Biodiversity offsets and their role in biodiversity conservation and sustainable use ... 20
Key design and implementation features and good practice insights ........................... 24
References .................................................................................................................... 26
Annex 1.A1. Case study overview ............................................................................... 29
PART I Key design and implementation issues .......................................................... 37
Chapter 2. No net loss, the mitigation hierarchy and the economics of
biodiversity offsets ......................................................................................................... 39
No net loss .................................................................................................................... 40
The mitigation hierarchy .............................................................................................. 43
Three types of biodiversity offsets: One-off, biobanking and in-lieu fees ................... 50
The economics of biodiversity offsets.......................................................................... 53
Notes ............................................................................................................................ 59
References .................................................................................................................... 60
Chapter 3. Institutional frameworks for biodiversity offsets ...................................... 65
Compliance-based or mandatory approaches to biodiversity offset programmes ........ 66
Biodiversity offset requirements as a condition of project finance .............................. 70
Voluntary approaches for biodiversity offsets ............................................................. 73
Comparing the institutional architectures for offset schemes ...................................... 75
Note .............................................................................................................................. 77
References .................................................................................................................... 77
Chapter 4. Design and implementation features of biodiversity offset
programmes .................................................................................................................... 81
Coverage and thresholds .............................................................................................. 82
Equivalence .................................................................................................................. 87
Additionality ................................................................................................................ 99
Permanence ................................................................................................................ 101
BIODIVERSITY OFFSETS: EFFECTIVE DESIGN AND IMPLEMENTATION © OECD 2016
8
– TABLE OF CONTENTS

Monitoring, reporting and verification ....................................................................... 104
Compliance and enforcement ..................................................................................... 110
Transaction costs ........................................................................................................ 113
Notes .......................................................................................................................... 118
References .................................................................................................................. 119
Part II Case studies ...................................................................................................... 129
Chapter 5. Compensatory mitigation and wetland banking in the
United States ................................................................................................................. 131
The environmental and regulatory context of wetland compensatory mitigation ...... 132
Design and implementation of the US Wetland Compensatory Mitigation
programme ................................................................................................................. 139
Performance assessment in wetland compensation .................................................... 150
Insights, best practices and lessons learned ................................................................ 159
Notes .......................................................................................................................... 167
References .................................................................................................................. 168
Chapter 6. German Impact Mitigation Regulation in Hessen .................................. 175
Introduction ................................................................................................................ 176
The German Impact Mitigation Regulation as the legal framework .......................... 177
Key design and implementation features of the Impact Mitigation
Regulation in Hessen .................................................................................................. 178
The Impact Mitigation Regulation in Hessen in practice ........................................... 184
Insights and lessons learned from the Hessian experience ......................................... 190
Notes .......................................................................................................................... 193
References .................................................................................................................. 194
Chapter 7. Mexican Environmental Compensation Scheme for
Land-Use Change in Forested Areas .......................................................................... 199
Introduction: Background, rational and objectives of the Mexican
Environmental Compensation Scheme for Land-use Change in Forested
Areas .......................................................................................................................... 200
Key design and implementation features of the Mexican scheme ............................. 201
Environmental and cost effectiveness of the CUSTF................................................. 212
Conclusions ................................................................................................................ 218
Note ............................................................................................................................ 219
References .................................................................................................................. 220
Annex II.A1. Summary of offset features in Germany, Mexico and the
United States ................................................................................................................. 221
BIODIVERSITY OFFSETS: EFFECTIVE DESIGN AND IMPLEMENTATION © OECD 2016