What is the Biodiversity Offset Scheme?

In what situations does the Biodiversity Offsets Scheme apply?

Local development that will have impacts above the ‘Biodiversity Offsets Scheme Threshold’ or is likely to significantly affect threatened species or ecological communities based on the assessment of significance in s7.3 of the Biodiversity Conservation Act 2016. (“Local development” is development approved under Part 4 of the Environmental Planning and Assessment Act 1979 (EP&A Act) other than State Significant Development and Complying Development)

• State Significant Development and State Significant Infrastructure, unless it is not likely to have any significant impact on biodiversity values (as determined by the Secretary of the Department of Planning and Environment and the Chief Executive of the Office of Environment and Heritage)
• Clearing above the Biodiversity Offsets Scheme Threshold regulated through the Vegetation State Environmental Planning Policy. This covers clearing that does not require development consent in urban areas and environmental conservation zones (E2-E4 zones)
• Agricultural clearing proposals that require approval by the Native Vegetation Panel under the Local Land Services Amendment Act 2016
• Biodiversity certification proposals
• Activities assessed under Part 5 of the EP&A Act, if the proponent chooses to opt-in to the Biodiversity Offsets Scheme

What is the Biodiversity Offsets Scheme Threshold?

The Biodiversity Offsets Scheme threshold is a simple, objective, risk-based test used to determine when the Biodiversity Assessment Method and the Biodiversity Offsets Scheme apply. It is relevant to local developments (Part 4, non-state significant development/state significant infrastructure under the Environmental Planning and Assessment Act 1979) and clearing regulated by the State Environmental Planning Policy (Vegetation) 2017 (Vegetation SEPP).

There are two elements to the threshold test – an area trigger and a Biodiversity Values Map trigger. If clearing exceeds either trigger, the Biodiversity Offset Scheme applies to the proposed clearing.

Local development that does not exceed the threshold are also required to assess if the development is likely to significantly affect threatened species or ecological communities based on the assessment of significance in s7.3 of the Biodiversity Conservation Act 2016. If the development is likely to have a significant effect, then the Biodiversity Offsets Scheme applies.

How can a developer meet their offset obligation under the Biodiversity Offsets Scheme?

Developers have a range of options to offset biodiversity impacts under the Biodiversity Offsets Scheme. These include buying credits from Biodiversity Stewardship sites, funding biodiversity actions or they can pay money into the Biodiversity Conservation Fund to meet their offset obligation. The Biodiversity Conservation Regulation 2017 contains offset rules governing how these offset options are used.

How are Species Credits calculated?

Species credits are created for threatened species that cannot be reliably predicted using habitat surrogates. The number of species credits is calculated based on targeted survey reports.

How are EcoSystem Credits calculated?

Ecosystem credits are created for all ecological communities, as well as threatened species that can be reliably predicted as occurring on site, using the presence of vegetation that provides habitat for a given ecological community or threatened species. The number of ecosystem credits is calculated based on vegetation surveys.

How much does it cost to purchase a biodiversity credit under the Biodiversity Offsets Scheme?

If a landholder decides to generate biodiversity credits (by signing up to a biodiversity stewardship agreement) they can sell those credits to developers to offset the biodiversity impacts of the development proposal. Alternatively, government or philanthropic organisations may choose to purchase the credits to secure biodiversity protections for the site.

The sale price for these credits will be negotiated on a case by case basis by the landholder and the credit buyer. As a minimum, the price must include the costs of managing the stewardship site.