Designing Biodiversity Offsets in Canada: Getting the Fundamentals Right

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Information about Designing Biodiversity Offsets in Canada: Getting the Fundamentals Right

Published on February 19, 2014

Author: IEUO



Written by Marian Weber, Alberta Innovates – Technology Futures

Designing Biodiversity Offsets in Canada: Getting the Fundamentals Right Biodiversity Offsets in Canada: Getting it Right, Making a Difference February 14, 2014 University of Ottawa Marian Weber, Alberta Innovates Technology

What are Offsets  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  Biodiversity offsets are a risk management tool to transfer environmental liabilities from development between parties (Govt, proponent, 3rd parties)

Policy Drivers for ES Markets in AB AB Land Stewardship Act NEB AB Public Lands Act Act AB Water Act AB Land Use Framework Cumulative Effects Management System Regional Plans Integrated Resource Management System: Integrated Resource Plans Environmental Management Frameworks Air, Water, biodiversity AB Enviro Protection & Enhancement Act AB Wetlands Policy Wetland mitigation banking Provincial Offsets (air, water quality, land) Single Regulator And Yet … Fisheri es Act Migratory Birds Conventi on Act Tradable Water licenses Framework for Market Based Compliance and Conservation Exchange Canadian Enviro Assesmen t Act Species at Risk Act AB GHG Reduction Program: Emission Performanc e Credits Federal Offsets ABcarbon offset system 3

Federal Context  DFO - Fisheries Act (2012) s.35(2b)  serious harm to fish (populations)  Requirement to Offset  Environment Canada “Operational Framework for Use of Conservation Allowances”  Opportunities for the consideration of conservation allowances may arise through processes administered under the Migratory Birds Convention Act, 1994 (MBCA), the Species at Risk Act (SARA), the Canadian Wildlife Act (CWA) and Canadian Environmental Assessment Act, 2012 (CEAA 2012) that could allow Environment Canada to consider a proposal for conservation allowances as a means of mitigating residual environmental effects

DFO – Responsibility of the Applicant  Description of Effects on Fish and Fish Habitat  (a) the fish species that are likely to be affected and the life stages;  (c) the probability, magnitude, geographic extent and duration of the likely effects on fish and fish habitat; and  (d) a description of the methodologies  monitoring and contingency measures; cost of implementing each element of the offsetting plan;

EC Framework –  evaluation of allowances within the mitigation hierarchy;  An allowance agreement should include key elements  area, timing, duration, monitoring procedures, milestones and consequences for non-performance  The enforceability of offsets depends on the nature of the Act (CEAA, SARA, etc.)  Each proposal examined on a case-by-case basis  3rd party banking –  established prior to approval of any land- or resourceuse activities would be determined on a case-by-case basis

Alberta’s Land Use Framework (2008)  A blueprint for land-use management and decision-making to address Alberta’s growth pressures  Set regional goals and objectives for air, land and water  Conservation Offsets

Environmental Management Frameworks  Air, Water Quality, Water Quantity, Biodiversity  Tiered Threshold Approach (triggers, limits)

ERCB Shell-Jack Pine Decision  Canada and Alberta to consider conservation offsets to address the significant adverse project effects to:  wetlands, wetland-reliant species at risk, migratory birds, biodiversity, cumulative effects to wetlands, traditional plant potential areas, old-growth forests, ….  Regard for proposed environmental objectives for the Athabasca oil sands region and current and proposed policy frameworks,  biodiversity management framework, Alberta’s wetlands policy, and EC’s Operational Framework for Use of Conservation Allowances, etc.

Mines versus death by 1000 cuts Many projects do not trigger EIA Oilsands mining area 4800 km2 (~15% now) ~55% native prairie lost ~60% wetland loss In-situ 2.510 ha/day forest lost

No Net Loss? Regulated Landscapes versus - Shifting Mosaic

Planning vs Decentralized  Management and Planning Paradigm      Permanence Separation of uses Economic Security Site Specificity Targeting  OFFSETS  Protected Area Network, Corridors  Economic and Ecological Behavior  Dynamic  Autonomous  Feedback effects  OFFSETS  Ecological Risk Management, Range of Natural Variation, floating reserves?

Offsets on Public Lands  Environment Canada Framework on Allowances  A provincial or regional land-use plan may set aside protected areas ahead of time … could function as a “habitat bank” from which future allowances could be obtained.  Moral Hazard Problem?

Is there justification for Private offsets on Public Lands  Perception  back door to de facto protected areas  SO2 - standards vs tradable allowances  Ambient Emissions Target  Govt doesn’t know costs  Reserves versus Offsets  Don’t know where resources are or value (exploration)  What to avoid  Offset market – price avoidance  “highest and best use given objectives

Cumulative Effects - The Operational Challenge  How to lay out footprint (20-50 years)  How does footprint affect objectives under various legislative, regulatory, and other policy triggers?  What to reclaim to  E.g. what combinations and configurations of upland and wetland will support meeting environmental targets?  Future versus Present  “wicked problem”  Landscape is evolving  Depends on what everyone else does

Integrating Land Use Decisions across Planning Scales REGION SITE Development Problem Coordination Problem Planning Problem •What is the best layout of footprint over the life of a single project? •What are current and future regional landscape outcomes? • What is optimal reclamation strategy over space and time? •How does my project interact with other projects (which could be mine, or belong to someone else) at a landscape level to meet landscape objectives? • If there are environmental markets what is the value of changing my plan? • How can we coordinate and optimize across multiple projects at a landscape level • How can I optimize the value of my project given environmental constraints or targets? • Adaptive Management Wicked Problem … To solve alone

Offset Markets versus Offset Transactions  Coordination Role  Need “Infrastructure” to Address Interdependence and complexities  Sending the right price signals about future constraints – different habitats, etc.  Shadow cost constraints given what everyone else does  Price avoidance on working landscape relative to goals

Coordination Problem – too complex?  Analogy: Airline Gate Trading  Limited number of Gates  Trading gates increases airport efficiency & airlines profitability  Proof of Concept Extended to Airspace trading  who gets what path, which gates  Piloted – NVX Australia  AB – Software for ILM (Silvacom)  Too complex?  Compare to DFO responsibilities delegated to companies

Summary  Offsets stalled because we haven’t solved the ‘what for’ problem  Mitigation Hierarchy  A stop gap in the absence of tools for planning, objectives and thresholds  Wrong scale and un-implementable in practice  Un-necessary if we price impacts and avoidance

Summary  Permanence  Working landscape objectives versus de facto protected areas  Clarify what the role of protected areas is  Additionality … (with a plan)  is about allocating baselines  Distributional issue (WHO PAYS AND HOW MUCH) not an outcome issue

Summary  Policy Patchwork policy and need for Consistency and Standardization  No objectives against which to price/value decisions  Fed frameworks pass liability to companies without certainty  Discourages up-front investment  Delegates enforcement (3rd parties?)  NGOs do not want to be enforcers

Summary  Government Needs to  Set plans and objectives (TARGETS FOR HABITAT/DISTURBANCE)  Distinguish Protected Areas vs Working lands Objectives  Replace mitigation hierarchy with an offsets market that prices avoidance

SUMMARY  Government needs to  Establish Consistency between Departments and Acts for how offsets will be used  Equivalence - Methods, Metrics, requirements  Infrastructure  Reduce uncertainties around transfer of liability  Clarify responsibilities of Industry vs Government  Eliminate barriers to participation on public lands  New dispositions for creating public values on public lands Thankyou

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