Biodiversity Offsets Program outcomes
The NSW Biodiversity Offsets Scheme was established under Part 6 of the Biodiversity Conservation Act 2016. The scheme is administered by the Environment, Energy and Science Group within the NSW Department of Planning, Industry and Environment. To find out more about the scheme visit the DPIE website.
The BCT has four roles under the scheme. To find out more about the BCT’s roles, visit our Biodiversity Offsets Program page.
1. Facilitating the supply of biodiversity credits
Landholders wishing to generate and sell biodiversity credits can apply to the BCT to enter a biodiversity stewardship agreement (BSA).
As at 31 March 2020, 192 landholders have entered BSAs, creating biodiversity stewardship sites over more than 22,700 hectares. This includes biobanking agreements established under former legislation and new BSAs. Additionally, 39 applications for new BSAs are currently being assessed by the BCT.
As a result, many threatened ecosystems and habitats for NSW’s threatened native plant and animal species are being protected and managed by private landholders. This will maintain and improve the biodiversity conservation values at these sites, in the long term.
The BCT manages all active biodiversity stewardship agreements by reviewing annual reports, undertaking annual site inspections and; if management actions have been completed, making annual management payments to the landholder.
2. Managing the Biodiversity Stewardship Payments Fund
A central component of the Biodiversity Offsets Scheme is the requirement that, upon the sale of credits, a landholder deposit a specified amount of money into the Biodiversity Stewardship Payments Fund (also known as the total fund deposit). The BCT invests these funds and draws on the proceeds of investment of these funds, to make annual management payments to owners of active biodiversity stewardship sites. Sites go into active management when landholders have sold enough credits to meet their total fund deposit in full.
As at 31 March 2020, the BCT held total assets of $131 million in the Biodiversity Stewardship Payments Fund. The BCT has made $9.6 million in annual management payments to the holders of active biodiversity stewardship sites in the past 12 months.
The BCT is the appointed Fund Manager for the Biodiversity Stewardship Payments Fund. The BCT manages the Fund in accordance with a comprehensive Funds and Investment Management Framework approved by the BCT Board. Among other things, the Framework requires the BCT to seek regular actuarial and investment management advice to support investment management decisions. The BCT’s investment adviser and manager is NSW Treasury Corporation, one of the biggest investment managers in Australia. You can find out more about our investment management performance by reading our annual reports.
3. Securing offsets on behalf of developers
Under the NSW Biodiversity Offsets Scheme, developers can choose to meet an offset obligation by making a payment into the Biodiversity Conservation Fund. Once that payment is made, the legal obligation to secure the offsets transfers to the BCT. The BCT must secure offsets in line with legislated offset rules (set out in the Biodiversity Conservation Regulation 2017).
As at 31 March 2020, 86 developers have made payments of over $16 million into the Biodiversity Conservation Fund, transferring 178 offset obligations to the BCT.
So far, the BCT has secured or is in the process of securing biodiversity credits to meet 15 offset obligations. To date, 100% of offsets secured by the BCT have met like-for-like offset rules and all BCT purchases are recorded on the Biobanking and Biodiversity Offset Scheme public registers by the Department of Planning, Industry and Environment. The BCT aims to fulfil offset obligations transferred by developers to the BCT within two years.
To date, the BCT has secured offsets via four biodiversity credit tenders and one biodiversity credit fixed price offer.
Biodiversity credit tender 1 – Western Sydney (2018)
This tender targeted ecosystem credits representing some of the most threatened bushland in Western Sydney, including the critically endangered Cumberland Plain Woodland and Shale Sandstone Transition Forest. We received a strong response to the tender and purchased over 2,300 ecosystem credits from 11 biodiversity stewardship sites in Western Sydney.
Some of these credits have been used to acquit developer offset obligations as well as to meet objectives of the Growth Centres Biodiversity Offset Program (see below).
The remaining credits are being held by the BCT in anticipation of future developer payments into the Biodiversity Conservation Fund. By building a strategic portfolio of credits, the BCT can manage risks associated with fluctuating credit prices, take advantage of economies of scale and save on future administration costs associated with securing offsets.
Biodiversity credit tender 2 – Sydney-Hunter and South East region (2018)
Under this tender, the BCT targeted ecosystem and species credits in the Sydney-Hunter and South East regions of NSW, that were needed to acquit offset obligations held by the BCT.
Subscription to this tender was modest, however the BCT was able to secure Squirrel Glider and Southern Myotis species credits from two biodiversity stewardship sites in the Hunter region.
Biodiversity credit tender 3 – state-wide (2019)
The BCT ran the first state-wide biodiversity credit tender in July 2019, targeting ecosystem and species credits that could be used to acquit offset obligations held by the BCT.
The tender was well subscribed and the BCT has purchased or is in the process of purchasing, 1,759 ecosystem credits from 5 biodiversity stewardship sites in the Central West, Northern Inland, Sydney-Hunter and North Coast regions.
Through these purchases, the BCT will be helping landholders to protect and manage areas of the:
- Box Gum Woodland endangered ecological community in Narrabri Shire Council and Bathurst Regional Council Local Government Areas (LGAs)
- Hunter Lowland Redgum endangered ecological community in the Port Stephens Council LGA
- Coastal Swamp Forests in the Richmond Valley Shire Council LGA
- Sydney Coastal Dry Sclerophyll Forests and Hunter Macleay Dry Forests in the Port Stephens Council LGA.
The credits secured from this tender will offset impacts from a variety of developments, including a quarry, wind farm, coal mines, residential developments and a high school.
Biodiversity credit fixed price offer 1 – state-wide (2018)
The BCT offered its first biodiversity fixed price offer in late 2018, seeking to purchase a range of ecosystem and species credits at an advertised fixed price. Results from this process will be announced once this process is concluded.
4. Securing offsets on behalf of government
The BCT can be funded by the Australian and/or NSW governments to secure offsets under place-based biodiversity offsets schemes. Since 2017-18, the NSW Government has commissioned the BCT to deliver offsets under the Growth Centres Biodiversity Offset Program, which operates in Western Sydney.
Targets under this program are expressed in hectares, and from 1 July 2017 to 30 November 2019, the BCT protected approximately 137 hectares of Commonwealth-listed Cumberland Plain Woodland (against a long-term program target of 2,400 hectares) by purchasing credits from four existing biodiversity stewardship sites and seven new biodiversity stewardship sites.
During this period, the BCT also protected approximately 8 hectares of Shale Sandstone Transition Forest (against a program target of 132 hectares) and a population of threatened Spiked Rice-flower (Pimelia spicata) from two biodiversity stewardship sites.
These credit purchases were made via the 2018 Western Sydney tender (Biodiversity credit tender 1) and a Growth Centres biodiversity credit tender (Biodiversity credit tender 4) held in July 2019.