Biodiversity offsets may drive growth, but duck the problem

England’s green and pleasant land: will biodiversity offsetting help or hinder it? Gareth Fuller/PA

The idea behind biodiversity offsets is to develop a new way of preserving nature that more accurately accounts for the value to us of the natural world.

The abundance and diversity of plants and animals, and their role in ecosystems – known as biodiversity – can be damaged or destroyed by building and development. But this is what economic growth generally involves: roads, houses, offices and industrial plants have to go somewhere, and sometimes the environment is damaged or destroyed as a consequence.

Ideally, it would be possible to generate economic growth in a way that avoids biodiversity loss and preserves nature. One way this could be achieved is biodiversity offsets. This mechanism would require developers to provide compensation for the damages which result from their actions.

For example, destroying a wood to make way for new houses would mean the developer would have to provide another wood somewhere else to replace it, or pay a third party to do so. These offsets, proponents argue, should result in “no net loss” of biodiversity from development.

The concept of biodiversity offsets is being discussed by the UK Parliament’s Environmental Audit Committee. If proposals are taken forward, biodiversity offsets could become one of the most important changes to how decisions affecting the environment are made in Britain.

Supporters claim this would create a better way of making decisions. Modern societies appear to have a broken economic compass: we don’t value nature enough compared to development and economic growth. Biodiversity offsets would put a price on nature, and force developers to pay for the damage they inflict. This would make development more expensive and conservation more appealing.

Offsets and planning

There are other ways of choosing between development or conservation. In Britain this is governed by the need for planning permission, which is granted or denied, or granted with conditions, by local authorities. One of the aspects they must consider is impact on biodiversity, and through conditions known as Section 107 agreements they have the power require compensation in cases where a project would have a negative impact on nature.

The Department for the Environment, Food and Rural Affairs commissioned the Ecosystem Markets Task Force (EMTF), to examine this and other market mechanisms that affected the environment. The EMTF identified biodiversity offsets as the most promising in terms of promoting economic growth, with the potential to simplify the planning process, and reduce the time it takes to obtain planning permission. These comments were echoed by the secretary of state, Owen Patterson, who said it would allow the economy to grow, while protecting nature. But it is not clear how the biodiversity offset mechanism would be integrated into the existing planning system.

Licence to trash

Despite these claimed advantages, environmental activists and NGOs have raised concerns about the feasibility and potential consequences of biodiversity offsets.

Biodiversity is complex and biologists have generally been critical of claims that biodiversity can be easily measured and quantified in a single location, let alone then usefully compared to biodiversity elsewhere. It is not possible to assure that biodiversity in two locations is the same, or qualitatively equivalent. And without this, the principle of ensuring no net loss of biodiversity collapses.

The displacement of damages also raises problems, as it allows the possibility of damages in an area with high land prices, such as London and the South East, to be offset in an area where land prices are much lower, such as the North East of England. This would lead to an unfair and uneven distribution of damages and biodiversity, and again would not ensure no net loss of biodiversity in any meaningful way.

A final question raised is about power. Critics of offsetting suspect that it would render the planning process toothless, allowing rich and powerful companies to simply buy their way out of the proper planning process. Biodiversity offsetting, could easily become a licence to trash.

Questions remain

The idea underpinning offsets is appealing, and could at least be used to spark debate about the value - the literal, economic worth - of nature and the need to conserve it. But the rules and regulations parliament is considering must ensure that the maximum distance between damage and offset is limited and that the limits to measuring biodiversity are compensated for. And, most importantly, biodiversity offsetting must work as a part of the existing planning regulations, not supersede it.

Biodiversity offsetting has the potential to change the way we think of nature in Britain. It should be discussed and analysed by the public before becoming compulsory. But it should not be allowed to become the main way by which we, as a society, govern nature.

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