Biodiversity offsetting is a hot topic in New Zealand resource management law. Decision-makers expect biodiversity offsets to be proposed in appropriate circumstances in resource consent applications and Councils are increasingly providing for biodiversity offsets in planning documents.

This has led to developers establishing comprehensive biodiversity offset programmes for their projects.  This article reviews current trends in biodiversity offsetting in New Zealand and considers future developments in this evolving area.

What is biodiversity offsetting?

There is no single accepted definition of biodiversity offsetting.  However, the definition most commonly adopted is that of the Business and Biodiversity Offsets Programme (BBOP):1

“Biodiversity offsets are measurable conservation outcomes resulting from actions designed to compensate for significant residual adverse biodiversity impacts arising from project development after appropriate prevention and mitigation measures have been taken.  The goal of biodiversity offsets is to achieve no net loss and preferably a net gain of biodiversity on the ground with respect to species composition, habitat structure and ecosystem function and people’s use and cultural values associated with biodiversity.”

Why has the use of biodiversity offsetting recently grown?

New Zealand has suffered significant loss, and decline, in its indigenous biodiversity.  In response, the application of biodiversity offsetting has recently increased due to: developments in ecological best practice (largely aligned to BBOP); the development of a proposed National Policy Statement on Indigenous Biodiversity; the establishment by the Government of a Cross Departmental Research Programme on biodiversity; strong advocacy by the Department of Conservation; the review by regional Councils (in particular Horizons Regional Council) of regional policy statements and plans; and the consenting and designating of several large infrastructure projects.

Judicial developments

Judicial consideration of biodiversity offsets is still developing, with several key decisions released in the last year. In summary, the present position on key biodiversity offsetting issues is that:

  • Decision-makers will recognise, in appropriate circumstances, biodiversity offsetting as promoting sustainable management (the purpose of the Resource Management Act 1991 (RMA)) and expect it to be proposed
  • There is a difference between biodiversity offsetting (which relates directly to the biodiversity values affected) and environmental compensation (which does not directly relate to the biodiversity values affected but is rather a compensatory benefit)
  • Some uncertainty remains as to whether offsetting is a subset of remedying and mitigating adverse effects, or whether offsetting relates to residual effects after remediation and mitigation (likewise there is some uncertainty as to whether a hierarchical approach, consistent with BBOP principles, applies)
  • While no-net-loss (or net-gain) outcomes cannot override the sustainable management purpose of the RMA, no-net-loss outcomes may be required as a resource consent condition or provided for in a plan, so long as the offset is designed and implemented to meet the sustainable management purpose of the RMA
  • Not all residual adverse effects have to be offset (rather, thresholds have been established given the significance of the effect)
  • The limits as to what effects can be offset need to be considered against the circumstances and the proposed offset - simply because a threatened species or ecosystem is affected, does not mean that offsetting cannot be accepted by the decision-maker.

Policy developments

Two key national policy documents in respect of biodiversity offsetting are in development:

  • The proposed National Policy Statement on Indigenous Biodiversity.  The proposed NPS was released in January 2011 and submissions closed in May 2011.  While many submissions were received the progress of the proposed NPS has been in abeyance.  In the interim the proposed NPS, while not having any legal effect and despite the number of submissions, has been recognised by the Environment Court as ‘worthy of respect as a reflection of considered opinion.’
  • The Department of Conservation’s Best- Practice Guidance on Biodiversity Offsetting.  This guidance is currently under development and the submission period on a draft recently closed. Depending on the final contents of the guidance it is likely to provide detail on biodiversity offset development and modelling. While this guideline is not a statutory document, it is likely to have a significant effect on the implementation of biodiversity offsetting in New Zealand through being adopted as best practice and applied through planning documents and Court decisions.

Future developments

The concept of offsetting adverse effects is starting to be explored in new areas where there is resource constraint, such as water catchments and airsheds.  It is likely that the practice of offsetting in these and other areas will also develop over the next few years.

Although biodiversity offsetting is still developing, it is now established practice in New Zealand resource management law. It is critical that everyone associated with development projects that affect biodiversity is involved in the bedding down of biodiversity offsetting over the next few years.