Event report on Biodiversity offsets

Published 30 June 2014

On 7 April 2014 the Wellington Branch of the New Zealand chapter hosted an event on the topic of biodiversity offsets with support from the law firm Buddle Finlay.

Biodiversity offsets are becoming an increasingly popular yet controversial tool for protecting and enhancing New Zealand‘s biodiversity while enabling economic growth. Biodiversity offsets link conservation with industry, and are aimed at ensuring that development projects are implemented in a manner that results in no net loss of biodiversity. A key question of the night was: "What are the essential elements that ensure that any biodiversity offsetting initiatives are effective and meaningful?"

Three speakers covered a range of perspectives relating to this question - policy, law and implementation. Firstly, Spencer Clubb a Policy Analyst from the Department of Conservation (DOC) was to present on the topic of how can we ensure no net loss for the environment? Second, Bernie Napp a Policy Manager from STRATERRA spoke on making it work for developers and the environment. Lastly, David Allen an Environmental Lawyer from Buddle Findlay was to speak on guidelines from case law. 

Unfortunately on the night Spencer Clubb had to pull out so Abbie Bull from the DOC policy team spoke briefly on his behalf about DOC‘s biodiversity offsetting guidance principals. These principals have been developed in consultation with MFE, MPI, MBIE, LINZ and Local Government New Zealand. They are non-statutory (so can‘t be enforced) but instead are aimed at providing guidance to developers and decision-makers on best practice that is NZ specific. The best practice guide closely aligns with the business and biodiversity offsets programme (BBOP) that is an international collaboration between companies, financial institutions and government agencies to achieve no net loss in biodiversity. DOC was intending that the best practice guide would be launched within a matter of weeks.

Spencer‘s presentation looked at how the guidance document was formed. Since the other two speakers had been involved in that process, they were able to include this in their presentations. A key question was would DOC support a resource consent application if the developer applied the DOC guidance principals? As the principals will not
be enshrined in legislation DOC considers it will not have a role in defending the principals – it will be up to the decision-makers – local and regional councils, the Environment Courts and the EPA. The guidance principals are in the form of a tool-kit aimed at helping communities, environmental NGOs, land owners, Iwi and local councils work out the best way to protect biodiversity. Consequently, the practice guide does not attempt to solve the many issues around biodiversity offsetting.

Bernie Napp considered that DOC has done great work to date. However, he thought that the industry sector was looking for outcomes in policy and regulation that is more flexible and therefore more efficient than current provisions. In his view, the current legislative framework is not workable as there are five pieces of legislation that affect biodiversity offsetting: the RMA, the Conservation Act, the Crown Minerals Act, the Wildlife Act and the Historic Places Act. For the industry sector, this is perceived as a mess that makes it difficult to do business in New Zealand. Once mined, land can never go back to where or how it was previously. However, Bernie showed several examples of the rehabilitation of lands that had been mined. One of these was the Golden Cross mine site which is one of few examples in NZ of a mine proceeding through development, operation and closure since 1990. Rehabilitation has resulted in the site being turned into working farmland with a wetland ringed with native vegetation.

The DOC guidance is difficult for industry to accept as (except in the case of farmland) it is not easy to replace like for like. Farmland after mining is often more fertile than before due to the reconstitution of the soils and mitigation inputs. Additionally, there is concern that NGO‘s who oppose mining for whatever reason might use the DOC guidance as a measuring stick. This has already happened when Forest and Bird referred to the
DOC draft guidance in the Environment Court in the case of the Escarpment Mine on the Dennison Plateau. Bernie summed up that we only talk about biodiversity offsets because we are talking about development and he feels that because we need the income generated by industrial development there needs to be a more collaborative process in deciding how the environment is protected and to what level. He wondered if biodiversity offsets will ever be achieved to the standard that DOC would like.

David Allen began by defining the terminology within law on biodiversity offsetting. The High Court has resolved an argument relating to what biodiversity offsets are under the RMA – whether they are mitigation or compensation. The Court ruled that biodiversity offsets do not mitigate the effects of the activity because they are not direct and are not on the development site. They are therefore to be considered as compensation. David provided an example where Forest and Bird argued in Court that if offsetting is not mitigation it should not be given much weight in reaching a decision under the RMA. However, the High Court responded by saying you need to consider each application on a case-by-case basis. Decision makers should give offsetting as much weight at they consider appropriate taking into consideration the nature of the particular development and the requirements of the RMA.

David also provided an example of a consent application that included a biodiversity offset area of 0.45 hectares of bush in return for removing 3 patches of bush which was classified as having District Significance. The bush with District Significance was largely not fenced nor protected in any way but the district plan did have rules that meant you would need a resource consent if you wanted to chop it down. An environmental expert engaged by objectors rejected the initial proposed offset so the applicant proposed a 1.4 hectares (3:1) offset, fenced and covenanted and with 5 years of pest and weed control. Once again the objector‘s expert declined this application mainly because part of the bush was already properly fenced and protected by the Plan and therefore it was not a gain for the environment, in fact the loss of the 3 patches of bush would result in a net loss compared to the current situation. Instead the objectors sought a 6:1 offset (2.7 hectares) and legal
protection in perpetuity, perpetuity in pest and weed control, offset for the loss of individual trees as well as the area of bush around it, 7.8 hectares of buffer planting for edge effects and the enhancement of ecological corridors in addition to the 15 hectares of native landscape planting that was proposed by the applicant. 

In the end the decision-makers ruled that the applicant had to provide 1.5 hectares of indigenous forest, legal protection in perpetuity and 5 years of pest and management control for that area. This was similar to what was initially proposed. This agreement was a result of a hearing that included evidence from 5 experts, rebuttal evidence and three days of expert conferencing on that topic as well as direct discussions amongst the parties and significant planning and legal input. The point made was that environmental experts need to be realistic in their expectations of what applicants under the RMA should be expected to provide in terms of biodiversity offsets. Environmental experts should also be prepared to
work collaboratively to find win/win solutions instead of engaging in confrontational processes that impose costs on all parties. All speakers put forward well balanced and thought provoking presentations. This provided plenty of discussion and questions during
the evening as many members of the audience had a strong interest in the topic. Consequently, the evening went well over the allocated time.