On World #BiodiversityDay (22 May) the Biodiversity Credit Alliance , whose Secretariat is facilitated by UNDP & United Nations Environment Programme Finance Initiative (UNEP FI) has published its ‘Definition of Biodiversity Credits’ issue paper to “ help biodiversity crediting avoid a “false start” “. The authors  explain:

“Biodiversity credits have been identified, and are increasingly being piloted, as market-based mechanisms to accelerate private finance towards biodiversity conservation. Biodiversity credits are intended to facilitate and accelerate conservation actions and biodiversity outcomes. … Biodiversity Credit Alliance (BCA) is a partnership facilitated by UNDP and UNEP FI, working to help steer the development of a credible and scalable biodiversity credit market which is based on a framework of high-level, science-based principles.  …. One of the purposes of BCA’s work is to help biodiversity crediting avoid a “false start” from crediting efforts or transactions that set out with the best of intentions yet end up being criticized because they do not really succeed in helping biodiversity. Thus, as BCA creates definitions and norms around biodiversity credits, it is with the aim of focusing on the types of lower-risk credits, methodologies, and systems that are most likely to be successful in the early years of biodiversity crediting. “

I suggest that we should take a step back and ask first (why) do we need biodiversity credits?

What have we learnt from past failures, such as of the US Clean Water Act’s wetlands  compensatory mitigation program, which is the most extensive and longest-running environmental offsetting program in the World operating since 1995. A comprehensive 2022 study found that is is " unlikely that 𝐭𝐡𝐞 𝐩𝐫𝐨𝐠𝐫𝐚𝐦 𝐰𝐢𝐥𝐥 𝐚𝐜𝐡𝐢𝐞𝐯𝐞 𝐢𝐭𝐬 𝐞𝐧𝐯𝐢𝐫𝐨𝐧𝐦𝐞𝐧𝐭𝐚𝐥 𝐠𝐨𝐚𝐥𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐥𝐨𝐧𝐠 𝐭𝐞𝐫𝐦.". Also, what are the lessons from the voluntary carbon market that is far less complicated and complex than biodiversity, due to:

1, fungibility ( the mutual interchangeability of a tonne of CO2) versus the impossible question of how many earthworms or orchids worth an elephant?

2, global impacts versus always locality specific nature of nature;

3, scientifically well enough understood impacts of GHGs versus more than 80% of species are still waiting to be found & some 86 % of Earth's 8.7 million known species have yet to be fully described not to mention the complexity of any biomes.

There are also similarities, though they still pose major challenges:

a, the art of additionality to establish the counter-factual, what would have happened in the absence of an intervention;

b, time-dynamics, nature is never static and permanent;

Doubtlessly, improved technologies for MRV ( monitoring-reporting-verification) by using remote sensing, AI, machine learning, distributed ledgers is a major advancement: there is far less room to hide & cheat ...

How we (finance) restoring & protecting nature is as essential as mitigation of climate change and building resilience for already baked-in impacts. Luckily an ongoing Survey,  "Understanding the state of biodiversity credits and their link with the carbon market" contracted by the European Commission and carried out by ICF with the support of Perspectives Climate Group is looking at exactly these issues:

• "identify the potential for the voluntary carbon market to contribute to biodiversity objectives through implementing high-integrity requirements for biodiversity-neutral and biodiversity-positive carbon programmes.
• investigate the potential development of standalone biodiversity claims in the form of biodiversity credits, with a special focus on the demand side of the market and the types of policies and measures that could be put in place to shape and enhance that market"

The Survey is available on the European Commission's dedicated website; it has yet to gain traction as around 30 entities have filled it in. 𝐈𝐭 𝐢𝐬 𝐨𝐩𝐞𝐧 𝐮𝐧𝐭𝐢𝐥 𝟑𝟏 𝐌𝐚𝐲, 𝐬𝐨 𝐭𝐞𝐥𝐥 𝐰𝐡𝐚𝐭 𝐲𝐨𝐮 𝐭𝐡𝐢𝐧𝐤 irrespective which side of the spectrum you are on - on one end believing that market failures/externalities can be corrected by more markets or the opposite: use regulatory and other measures to address fatal loss of nature.

Have your say so we don’t have a false start! Let's apply the precautionary principle and build on past lessons of the far less complex and complicated voluntary carbon markets! Let's have a broad, honest and scientifically-sound debate and seek consensus.

 

BCA paper authors: rePLANET ( Tim Coles and Dan Exton ), Ekos ( Sean Weaver ), Terrasos (Mariana Sarmiento), ValueNature ( Simon Morgan ), CreditNature ( Paul Jepson ), Consulted experts; Conservation International ( Erika Korosi ), Pivotal (Zoe Balmforth) and Pollination (Laura Waterford).