Biodiversity Conservation Fund Charge System

The new Biodiversity Conservation Fund Charge System will commence on 17 October 2022.

 

Click here to obtain a charge quote or make a payment into the fund.

The NSW Minister for the Environment and Heritage has recently approved the introduction of the new Biodiversity Conservation Fund (BCF) Charge System to be administered by the NSW Biodiversity Conservation Trust (BCT).

The BCF Charge System will be used to determine the cost of meeting biodiversity offset obligations for proponents who choose to pay into the BCF. It will replace the current Biodiversity Offsets Payment Calculator (BOPC). The BCF Charge System aims to more accurately predict the cost the BCT will incur in purchasing biodiversity credits from landholders.

A Ministerial Order, giving legal effect to the new BCF Charge System, is available on the NSW Legislation website. The Order establishes the BCF Charge System method. It also provides for a series of rules, to be published on the BCT’s website, that the BCT uses when calculating a BCF charge.

The BCF Charge System has been developed by the BCT and informed by an extensive stakeholder consultation process throughout 2021 and 2022. 

The BCF Charge System commenced on 17 October 2022. The BOPC was removed from public view on 17 October 2022.
 

  • The BCF Charge System will determine a charge by estimating the likely cost of acquitting an obligation for like-for-like credits from one or more of four tools outlined in the Order:

          - Cost-structure tool for ecosystem credits

          - Cost-structure tool for species credits

          - Econometric (or statistical) model for ecosystem credits

          - Market soundings

  • Development proponents can request a quote for a charge after finalising a Biodiversity Development Assessment Report (BDAR) and seeking development consent. Development proponents with a current development consent can also seek a quote.
  • The BCT will provide a charge within 10 working days for small projects and 30 working days for large projects, or longer by agreement. Small projects are those with an obligation of fewer than 50 credits in total.
  • Quotes will be valid for three years, subject to the transitional arrangements outlined below.
  • Development proponents will be able to pay a charge at any point in that three-year period, with indexation applied as outlined in the quote.
  • Development proponents can only pay a charge once development consent is granted. 
  • The BCT will publish quotes six months after they are provided.
  • The BCT's implementation of the BCF Charge System will be subject to annual independent assurance reviews commissioned by the Department of Planning and Environment.
  • The BCT and the DPE will provide market information tools to enable landholders and developers to estimate credit prices. 

 

Staged introduction of the BCF Charge System

To provide for a staged introduction of the BCF Charge System, price increases for some biodiversity credits will be capped at 20% relative to the most recent BOPC price for a 12-month period.

The cap will apply to any credits priced at $5000 or more under the BOPC.

The cap is established via a rule under the Order to be published on the BCT website. The cap will expire on 16 October 2023. 

Accordingly, quotes for any credits affected by the cap will be valid until 16 October 2023, not three years like other quotes. A new quote for credits affected by the cap can be obtained after July 2023 to be valid from 17 October 2023. 

 

Changes to the BCF Charge System arising from public consultation

The BCT has made several changes to the BCF Charge System to address stakeholder issues arising from the final period of public consultation in March-April 2022. These are:

  • A reduction in the delivery fee from 15% to 5% or $120 per credit (whichever is higher).
  • A reduction in the risk premium from the proposed 26-30% down to 11-17% for most credit types. The econometric model calculates a specific risk premium for the few credits priced with this tool.
  • Adoption of the new discount rate in estimating management costs under the cost-structure tool for ecosystem credits.
  • A 20% cap on price increases, relative to the BOPC price, for credits price $5000 or more under the BOPC, for a 12-month period.
  • An adjustment to the indexation approach.
  • A small change to the land valuation approach.
  • Inclusion of a larger BSA size category in estimating management costs.
  • Introduction of a price estimation service by the BCT, on a modest fee-for-service basis, available to landholders and developers, will be available early in 2023.
     

Development proponents can continue to make payments into the BCF using the BOPC until midnight 16 October 2022. 

The BCT will continue to progress any complete applications for payments into the BCF using the BOPC (including BOPC prices generated via the Biodiversity Offsets and Agreements Management System), received by the BCT prior to midnight 16 October 2022.

A development proponent wishing to make a payment into the BCF from Monday 17 October 2022 will need to seek a quote from the BCT. The BCT will apply the BCF Charge System in issuing that quote.


A proponent can seek a quote from the BCT to make a payment into the BCF if they have: 

  • Development consent which includes a requirement to retire biodiversity credits.
  • Submitted a development application, including a completed biodiversity development assessment report which indicates a biodiversity credit requirement.
  • Approval under Part 5.1 of the Environmental Planning and Assessment Act 1979 which includes a requirement to retire biodiversity credits or have submitted a Review of Environmental Factors to the determining authority.
  • Approval under Part 5A of the Local Land Services Act 2013 which includes a requirement to retire biodiversity credits or have submitted an application for approval. 
  • Biodiversity certification which includes the retirement of biodiversity credits as an approved conservation measure or have submitted an application for certification. 

For other development proponents and landholders, the BCT will offer a credit price estimation service for a small fee. This service will commence in early 2023. 

 

Price Estimation Service

From early 2023, the BCT will offer a price estimation service. This will be open to: 

  • Development proponents in the project planning phase who have an indicative credit obligation. 
  • Landholders who have a Biodiversity Stewardship Agreement (BSA) (fee-waived). 
  • Landholders who are assessing the feasibility of a potential new BSA and have an indication of credits via a feasibility report. 
  • Other credit owners. 
  • Agents acting on behalf of the above developers or landholders with their consent. 

The price estimation service will provide an indicative credit price (excluding the BCT’s delivery fee and risk premium). 

The BCT will charge a fee for this service to cover the BCT’s costs in issuing price estimates. This fee will be $200 per application, plus $100 for every credit type. An application will be restricted to a single development project or BSA site. 

Once the service commences, applicants can contact the BCT to discuss price estimations involving multiple projects or sites. 

The BCT will waive this fee for landholders seeking a price estimation on their credits at an existing BSA site (once per BSA). 

The BCT will commence this service in early 2023. 

 

After 17 October 2022, a proponent can make a payment into the BCF if they have: 

  • Development consent which includes a requirement to retire biodiversity credits.
  • Approval under Part 5 of the Environmental Planning and Assessment Act 1979 which includes a requirement to retire biodiversity credits.
  • Approval under Part 5A of the Local Land Services Act 2013 which includes a requirement to retire biodiversity credits. 
  • Biodiversity certification which includes the retirement of biodiversity credits as an approved conservation measure. 

30 September 2022 

  • BOPC Order published, establishing new BCF Charge System to commence on 17 October 2022.
  • BCT publishes rules and some datasets established under the BCF Charge System. 

11 October 2022

12 October 2022

  • BCT publishes application forms for requesting a BCF quote

16 October 2022

  • BCT ceases accepting applications to make payments into the BCF using the BOPC at midnight. 

17 October 2022

  • BCT commences issuing quotes using the BCF Charge System from 12.01am. 
  • BOPC comes down from public view. 

Early 2023

  • BCT commences biodiversity credit price estimation service

The BCT will apply one, two or three of the following four tools to determine a credit charge for each credit type.

1. Cost-structure tool for ecosystem credits

The cost-structure tool for ecosystem credits has three main drivers to determine the charge:

  • BSA management and entry costs - these are estimated using a best available map to predict likely BSA size for an offset trading group (OTG) and applying typical management costs from existing similar sites.
  • Land value - this is estimated using a best available map overlay of OTG with typical land values from current sales evidence. Return on land value is estimated against typical returns from sales of credits from existing similar sites.
  • Credit yield - this is estimated from the typical credit yields from existing BSSAR (Biodiversity Stewardship Site Assessment Report) assessments for similar OTGs.

2. Cost-structure tool for species credits

The cost structure tool for species credits has three main drivers to determine the charge:

  • Predicted survey, management and monitoring costs for the species
  • Difficulty of finding suitable offset sites for the species
  • Credit yield - typical number of credits generated at a site. This is based on the method for generating credits under the Biodiversity Assessment Method, such as count or area-based species for flora or whether habitat is widely available or is restricted to specific breeding habitat.

Individual species are categorised on relative scales against the first two categories, weighting is applied using the third value and a charge is estimated for each combination of categories.

3. Statistical (or econometric) model

The BCT engaged Marsden Jacob and Associates (MJA) to develop a new statistical model to determine charges for offset trading groups with sufficient trades to develop a robust charge. MJA (MJA 2022) recommended dynamic time-series model to establishes a charge.

Initially, the statistical model will only be used for the two most traded offset trading groups (Cumberland Plains Woodland in the Sydney Basin Bioregion and River-Flat Eucalypt Forest on Coastal Floodplains on the NSW North Coast, Sydney Basin and South East Corner Bioregions). There is the potential to add more OTGs to the statistical model in the future once sufficient trades occur. 

The model works from the evolution of average annual price for credits for the OTG, taking into account market participation and averaging of credit types. A forward forecasting component considers expected market tightness in the coming period.

4. Market soundings

The BCT may also apply market soundings in establishing a charge in certain circumstances. 

To achieve this the BCT will seek information from market participants that is not otherwise available, such as: 

  • Typical credit yield for an offset trading group when there is little or no relevant data from existing BSA sites 
  • The distribution of offset trading groups when the BCT considers the state-wide offset trading group layer has limitations 
  • Forecast demand and supply over coming three years for a relevant offset trading group and geographic region

The BCT will also use market pricing information obtained through our market activities where: 

  • there is strong evidence of a market price and ongoing credit supply from relevant sites;
  • a reverse auction process identifies a market price from multiple suppliers,
  • BCT has entered an agreement or option to purchase relevant credits.

The BCT can use these market soundings to help develop a credit charge. 

 

Rules

The BOPC Order provides for the BCT to publish four rules on its website, to be used when calculating a charge under the BCF Charge System. These are: 

 

Indexation

The BCT will apply indexation when determining a charge to forecast the likely cost of acquitting credits at a reasonable time of acquittal, being one year following the payment.

Quotes issued by the BCT will be valid for a period of three years (excluding quotes for any credits affected by the cap, which will be valid until 16 October 2023). These quotes can be activated by a proponent at any point in the three years, with indexation applied as outlined in the quote. 

 

Risk premium

The BCT will apply a risk premium of between 11-17% to the charge for most credit types. The risk premium aims to account for the risk to the BCT that we cannot deliver credits for the predicted charge. The econometric model calculates a specific risk premium for the few credit types priced with this tool.


Delivery fee

The BCT will apply a delivery fee of 5% or $120 (whichever is higher) to help cover the BCT’s delivery costs.
 

Continuous improvement

The BCT will adopt a continuous improvement approach to implementing the BCF Charge System, through regular data updates and review. This will include an annual update of:

  • management cost estimates to incorporate new BSA sites, adjusted to account for inflation of the key costs associated with managing BSA sites;
  • land values to incorporate new sales evidence;
  • recalculation of statistical model to incorporate new credit trades;
  • species credit allocations to categories against latest available data.

The BCT will also monitor the real costs of the BCT purchasing the credits against the BCF Charge predicted price to inform annual updates.

 

Impact on credit prices

The BCF Charge System will only set credit prices for development proponents seeking to make a payment into the BCF. The BCT does not intend for the BCF Charge System to set broader market pricing.

There will be changes in credit pricing between the existing BOPC and the BCF Charge System. Generally, prices will go up for rare and hard to source credits, especially on high value land. Prices will be more stable or go down for credit types that are widespread and/or on lower value land.

The BCF Charge System cost-structure tools will reflect the increases in the major input costs for credit generation over the two years since the BOPC was last updated, being land value, materials (chemicals, timber and steel) and labour. This should make it more viable for landholders to generate biodiversity credits, helping to alleviate the credit supply shortage.

The BCF Charge System will result in more stable and predictable pricing. The inputs to the BCF Charge System tools will be updated annually, leading to an annual price adjustment.
 

Consultation Process

Consultation with participants occurred in two stages. In the first half of 2021, the DPE conducted Stage 1 Consultation seeking feedback on the proposed changes as well as market tools to replace the BOPC when it comes down from public view.

Since June 2021, the BCT has conducted an extensive stakeholder and landholder consultation process on the BCF Charge System (Stage 2 Consultation). This included an initial webinar, release of an issues paper, 55 interviews with landholders, workshops with accredited assessors and an industry reference group and a final public consultation period in early 2022.

The outcomes of the Stage 2 Consultation process are outlined in the BCT’s Consultation Report.

We thank the participants for their time and helpful input throughout the process.

 

Independent review

The BCF Charge System method was subject to two separate independent peer review processes.

Natural Capital Economics (NCE) reviewed the draft method. NCE Provided an issues register and risk rating for the cost-structure tools methods, Opteon’s land valuation approach and the MJA econometric model. Each issue was reviewed by the BCT and a series of improvements were made. NCE reviewed the changes and rerated the residual risk. This resulted in the BCT making improvements to 40 identified issues.

Following the detailed review and improvement process conducted with the NCE, the final Charge System method and supporting material was reviewed by O'Connor NRM to provide assurance that the method was fit-for-purpose for implementation.
 

Calculator Component Value  Source and Data
Annual Index
(used in calculating predicted credit price and monthly indexation)
6.1%

Updated to June 2022

Management cost index = 4.2% (ABS Indices 10 years to June 2022)

Land Value Index = 8.0% (Rural Bank 20-year Rural Property values for NSW)

Best Available OTG Map
(BSA size estimation)
  SVTM V1.1.1
Published June 2021
Property Data
(BSA size estimation)
93,859 properties Opteon analysis
TFD Data See below 234 sites approved at August 2022, based on 3.2% discount rate and adjusted to June 2022 values
Land Value Land valuation date, December 2021 Opteon sales database to 4 April 2022
Species Credit Pricing Credit sales data to 10 October 2022 M1D1 transactions and tender data 1 July 2020 – 10 October 2022
Species Credit Price Categorisation Species Credit Price Categorisation for the Biodiversity Offset Payment Calculator
 
236 species categorised using TBDC data up to 24 October 2022
Species Credit Weighting   Species polygons available to March 2022
Econometric Model   Sales data to May 2022
Risk Premium – Greater Sydney 16.7% of predicted credit price Monte-Carlo Simulation of TFD data to August 2022, based on 65th Percentile
Risk Premium – Non-Sydney and species credits 11.1% of predicted credit price (as above)
Delivery Fees Greater of 5% of predicted credit price or $120/credit  

 

Biodiversity stewardship agreements (BSAs) are a key component of the New South Wales Biodiversity Offsets Scheme (BOS) and are administered by the NSW Biodiversity Conservation Trust (BCT). BSAs are in-perpetuity agreements registered on the land title. This means that current and future landholders are required to carry out management actions and other obligations in accordance with the BSA. Management of a BSA aims to achieve an improvement in biodiversity values of the land under the agreement. This improvement is the basis for generating biodiversity credits that can be sold and/or retired to offset the residual impacts of approved developments that trigger the BOS.

The amount that is set aside to manage the BSA in accordance with the management plan and in perpetuity, is called the total fund deposit (TFD). The TFD is calculated using the TFD calculator and is the total present value of all costs associated with managing the biodiversity stewardship site in-perpetuity. Each management action, the timing of the action and the cost of the action are to be outlined within the TFD calculator.

The TFD includes the costs for implementing required management actions and, if applicable, active restoration management actions as specified in the management plan. Proceeds of credit sales are used to fulfill the TFD. Once enough credits have been sold to fulfil 100% of the TFD (or in some cases, self-contributed in order to directly retire credits), the BCT will release annual payments as per the payment schedule in the BSA, to the landholder.
The annual payments are used by the landholder to fund the management actions and meet the relevant performance measures. Once the TFD is fulfilled, the proceeds of any future credit sales are retained by the credit owner.

Determining the amount of money associated with managing the BSA site in perpetuity is a critical step in planning the management of a biodiversity stewardship agreement. If the TFD does not adequately cover the cost of the management actions, current and future landholders are still required to implement all management actions and meet relevant performance measures.

The Total Fund Deposit amount at a BSA site is calculated for the management action required and planned at that particular site. TFDs between sites can vary substantially depending on a range of factors including the initial condition of vegetation at a site and the threats faced at the site. Analysis of existing data shows there is a strong relationship between TFD per hectare and BSA size, with smaller sites having much higher costs per hectare than larger sites. The analysis also shows that sites in Greater Sydney are, on average, more expensive per hectare to manage than sites outside of that area. This is not surprising as small sites, especially those close to the peri-urban interface often face substantially threats, have poor starting condition and require substantial actions to improve their condition.

Table 1 shows the average and typical range of TFDs for different size category BSAs in the Sydney and Non-Sydney regions. There is substantial variation around the average so it is important when assessing the suitability of a site to consider the site-specific factors when considering what an appropriate TFD amount might be.

Table 1. Average Total Fund Deposit per hectare and typical range for existing BSA sites in the Greater Sydney and Non-Sydney Regions. Values as of August 2022.

BSA Size Category
Geographic Region <30ha 30-50ha 50-100ha 100-200ha 200-500ha 500+ha
Greater Sydney Average $127,000 $82,200 $40,200 $29,300 NA NA
  Typical range $63-190k $41-125k $20-60k $20-40k    
Non Sydney Average $47,100 $21,400 $14,000 $9,700 $5,300 $2,700
  Typical range $23-70k $10-32k $7-21k $6-13k $4-7k $2-4k

The values in Table 1 are calculated from 234 existing BSA sites established between 2010 and 2022. The TFD values at each site were adjusted to account for inflation, changes in the discount rate and the additional requirements of Ecological Monitoring that were introduced in 2021. These values reflect likely values for those sites under the current discount rate (3.2%) which applies from August 2022.

Credit yield per hectare at a stewardship site is quite variable and depends on the range of factors described above. Table 2 and 3 show typical credit yield per hectare from existing and proposed stewardship sites for different vegetation formations and vegetation classes that have had the yield identified from a BAM assessment at more than 10 vegetation zones.  The typical range is the standard deviation in credit yield across those vegetation zones.  In the first example in Table 2, the average yield is 5.5 credits per hectare and the typical range is 2.1 credits per hectare, this means most vegetation zones have between 3.4 and 7.6 credits per hectare. 

Table 2: Credit Yield per hectare by vegetation formation with more than 10 assessments.

Vegetation Formation Credits/Ha Typical Range
Dry Sclerophyll Forests (Shrub/grass sub-formation) 5.5 2.1
Dry Sclerophyll Forests (Shrubby sub-formation) 6.1 2.0
Forested Wetlands 5.3 1.9
Freshwater Wetlands 5.1 2.9
Grassy Woodlands 5.9 2.2
Rainforest 6.1 1.1
Semi-arid Woodlands (Grassy sub-formation) 4.7 1.8
Semi-arid Woodlands (Shrubby sub-formation) 4.9 1.5
Wet Sclerophyll Forests (Grassy sub-formation) 7.7 2.2
Wet Sclerophyll Forests (Shrubby sub-formation) 5.9 1.3

Table 3: Credit Yield per hectare by vegetation class with more than 10 assessments.

Vegetation Class Credits/Ha Typical Range
Clarence Dry Sclerophyll Forests 5.7 1.6
Coastal Floodplain Wetlands 4.0 2.4
Coastal Swamp Forests 5.3 1.6
Coastal Valley Grassy Woodlands 5.8 2.4
Eastern Riverine Forests 6.0 2.1
Floodplain Transition Woodlands 6.0 2.4
Hunter-Macleay Dry Sclerophyll Forests 6.0 2.1
Inland Riverine Forests 6.2 2.1
New England Dry Sclerophyll Forests 7.1 1.7
New England Grassy Woodlands 5.9 1.2
North Coast Wet Sclerophyll Forests 5.9 1.3
Northern Hinterland Wet Sclerophyll Forests 8.0 1.9
North-west Slopes Dry Sclerophyll Woodlands 4.9 2.1
Pilliga Outwash Dry Sclerophyll Forests 4.9 1.9
Riverine Plain Woodlands 4.6 1.9
Southern Tableland Dry Sclerophyll Forests 4.7 1.9
Sydney Hinterland Dry Sclerophyll Forests 6.5 2.1
Upper Riverina Dry Sclerophyll Forests 4.9 2.1
Western Slopes Dry Sclerophyll Forests 6.5 1.9
Western Slopes Grassy Woodlands 5.9 2.1

Tables 2 and 3 show there is some differences in typical credit yield between different types of vegetation and regions at existing sites. Typical yield in some western vegetation communities is lower (on average) than those on the coast. Overall credit yield per hectare is typically between 4 and 8 credits per hectare, with average yield between 4.5 and 6.5 credits per hectare.

Frequently asked questions

In 2020, the NSW Government commissioned a review of the operation of the Biodiversity Offsets Payment Calculator (BOPC). The review was conducted by EY Port Jackson Partners (PJP).

The PJP report found that the BOPC was not fit for purpose, largely because there was limited credit trade data to underpin the model, leading to volatility in credit pricing. It recommended the BCT be responsible for developing and managing a new system to calculate developer charges for payments into the BCF that considered and weighted three decision-support tools: an econometric (statistical credit trade-based) model; a cost-structure model; and market soundings.

PJP also recommended that prices no longer be publicly available, but instead the BCT provide a direct quote to development proponents.

The then NSW Minister for the Environment and Heritage approved the PJP recommendations in-principle subject to the BCT conducting detailed method design and consultation with scheme participants and stakeholders.

The new system will provide greater certainty to market participants, including more stable credit pricing that better reflects the real costs to landholders of generating the credits and accordingly to the BCT in purchasing those credits. It will also secure the financial sustainability of the Biodiversity Conservation Fund (BCF).

The new system is one of the several improvements designed to strengthen the Biodiversity Offsets Scheme.

Development proponents who have completed a biodiversity development assessment report and submitted a development application or have already received approval for their project can seek a quote. Payment can only be made to the BCF once development approval has been granted, but the quote can be provided earlier to give proponents time to consider the best option to meet their obligations.

Other applicants can access the BCT’s price estimation service for landholders and developers on a modest fee-for-service basis. This will be made available from early 2023, once the BCT has processed the initial influx of quote applications.

Both the DPE and the BCT will publish market information. 

The DPE has released a range of market information tools, including a revised market sales dashboard, credit pricing guidance, and associated guidance on how existing tools can be used.

The BCT will publish quotes six months after they are provided. This is to reduce the impact of the BCF Charge System price as a price signal in the market.   

The BCT will expand our existing quarterly acquittals reports to include all credit obligations paid into the BCF, whether or not they are acquitted. For credits where quotes were issued six months or more prior, the price paid into the BCF will be published. For credits that are acquitted, the report will show the price the BCT paid to purchase those credits. 

The BCT will offer a price estimation service for landholders and developers on a modest fee for service basis in early 2023.

The BCT will also publish key data underpinning the BCF Charge System. This includes relevant, aggregated market information including typical BSA management costs, credit yields and allocation of species against the species credit model classification.

In response to consultation, price increases will be capped at 20% above the most recent BOPC prices for 12 months for credits priced $5000 or more. This is to enable a staged introduction of the BCF Charge System in a way that doesn’t cause significant market shocks. The cap will expire on 16 October 2023.

The Order provides for the BCT to publish five rules:

  1. Rules for Estimating Typical BSA Size
  2. Rules for Estimating Ecosystem Credit Yield
  3. Rules for Allocating Species to Categories
  4. Rules for Application of Market Soundings
  5. Transitional Price Cap Rules

These rules will be published on the BCT’s website and may be updated from time to time, e.g. to incorporate best available data.

No. There will be no option to review a BCF Charge issued by the BCT, just like there is no option to review a BOPC price currently. A proponent will still be able to pursue other options to satisfy credit requirements including generating their own credits or directly negotiating with landholders to purchase their credits.

The BCT is proposing to publish the following information:

  • details of all BCF charge quotes issued (irrespective of whether the payment is made) after six months.
  • type and number of credits for obligations transferred to the BCT through payment to the BCF (without the charge) at the time of payment.
  • continue to publish the BCT acquittals quarterly report, which shows the credits acquitted by the BCT, including the cost paid into the BCF and the cost paid by the BCT to purchase the credits. This will be expanded to include all credits paid into the BCF (not just those acquitted). For credits not yet acquitted where quotes were issued six months or more prior, the price of the credits paid into the BCF will be shown. 

The DPE will continue to publish the BCT’s credit transactions on the public registers. 

The BCT seeks credits to acquire in accordance with the offset rules set out in the Biodiversity Conservation Regulation.

The BCT identifies potential credit purchases through:

  • publishing a wanted credit list that shows what credits it is seeking
  • running periodic credit tenders (reverse auctions) and fixed price offers open to existing and prospective BSA holders
  • actively seeking landholders to generate credits for hard to source credit obligations via mapping, field validation and directly approaching relevant landholders to invite participation.

Yes. The BCT publishes a wanted credits list and can provide advice on what land may be suitable to establish a BSA to generate credits the BCT is seeking.

Landholders can also seek advice from an accredited assessor (accredited ecological consultant) or the Credit Supply Taskforce.

The Department has developed an assurance program to give scheme participants and the broader public confidence that the BCT is applying the BCF charge system efficiently, effectively, consistently and transparently.

The assurance program will include:

  1. An initial upfront check, undertaken by a third party within the first eight weeks of the BCF charge system commencing.
  2. An ongoing annual assurance review, undertaken by a third party within three months of the end of the financial year.
  3. Ongoing advice of Mr Mrdak AO, as independent monitor of the BOS Integrated Improvement and Assurance Program.

Assurance checks will be undertaken by third parties, external to both the BCT and the DPE.

Yes, the Department intends to publish the outcomes of assurance checks. This will improve transparency and give stakeholders greater confidence in the charge system and the assurance program.

The process for making a payment will change slightly. The BCT will publish more information on the application form for seeking a quote and making a payment on 12 October 2022. The BCT will continue to focus on providing a simple and streamlined process for making a payment into the BCF. 

Biodiversity credits are generated when you establish a BSA. There are two types of biodiversity credits: species credits and ecosystem credits, with hundreds of different types within each category. Biodiversity credits represent the expected improvement (gain) in biodiversity values that will result from the protection and management of your biodiversity stewardship site. The number and type of biodiversity credits generated by a BSA varies depending on the type and condition of the vegetation, threatened species present, and how your land will be managed to improve the biodiversity. The relationship between the condition of your land and land management is demonstrated in Figure 1 below.

BCT Biodiversity Credits

Figure 1: Biodiversity credits are generated for the avoidance of potential loss to biodiversity (that would likely occur in the absence of management) and the expected improvement in biodiversity values with increasing management.

Determining which type and how many biodiversity credits could be generated on your biodiversity stewardship site is achieved using the Biodiversity Assessment Method (BAM). Ecological consultants who successfully complete BAM accredited assessor training and meet the accreditation criteria are accredited to apply the BAM. These consultants are referred to as accredited assessors. Accredited assessors use the BAM to assess the biodiversity values on your land. The outcomes of the assessment are used to calculate the number and type of biodiversity credits that can be generated by establishing a BSA.