Biodiversity offsetting

New Zealand's indigenous biodiversity faces many threats, including loss associated with development and other activities that use natural resources. Biodiversity offsetting can play an important role in addressing this loss by providing a robust and transparent process to manage impacts and enhance biodiversity in New Zealand.

The following is a general overview of biodiversity offsetting, how it works, and why it is needed.

Guidance on biodiversity offsetting

For more in-depth information about the process download the New Zealand government's Guidance on Good Practice Biodiversity Offsetting in New Zealand.

The Guidance contains a detailed overview of biodiversity offsetting, including its definition, principles, and key concepts.

It also includes details of its application and the steps necessary to demonstrate good practice when choosing to develop and implement a biodiversity offset.

What is biodiversity offsetting?

The purpose of biodiversity offsetting is to counter-balance the unavoidable impacts that development activities have on biodiversity. It is a way to ensure that development causes no net loss, by enhancing the state of biodiversity elsewhere.

Offsetting considers and addresses the impacts that development activities have on biodiversity, after first avoiding, minimising and remedying any negative effects. Offsets mean that future generations will continue to enjoy the benefits provided by our biodiversity.

How does it work?

Typically, a developer is required to undertake environmental impact studies at a site before applying for consents to carry out a project.

The number one priority is to avoid impacts, first by exploring all alternatives, then by avoidance, through careful footprint design. The second priority is mitigation by minimising the impacts of a project on biodiversity; the third is on-site rehabilitation and restoration.

A biodiversity offset is the final option in this 'mitigation hierarchy'. It is used only to address the remaining impact. In other words, an offset should only be considered after all other prevention and mitigation measures have already been factored in and communicated in the proposal.

Where possible, impacts of development on biodiversity that cannot be avoided, remedied or mitigated at one site (impact site) are 'offset' by enhancing a separate nearby site (offset site), to achieve no net loss or a net gain in biodiversity.

The overall goal is that the amount, condition and security of biodiversity must be the same or better as a result.

What are the benefits?

Economic development requires new resources and infrastructure, and these often create negative environmental impacts. Increasingly, private land and public conservation land are the focus for hydro-power and renewable energy schemes, coal and mineral mining, and water extraction schemes.

In the right circumstances, biodiversity offsets can provide for no net loss and ultimately a net gain for biodiversity while economic development continues.

Another common argument for offsets is that they help conserve areas that are of higher biodiversity value than those being lost. For instance, if a company wants to develop an area of minor biodiversity value, the offset it undertakes could create substantial gain in, or protect an area of greater biodiversity value.

The Guidance contains information on the critical importance of stakeholder participation in such a process.

Why biodiversity offsetting is needed

As we consume natural resources we are reducing the world's biodiversity and ecosystems at an unsustainable rate, and this is already starting to have serious socio-economic impacts that ultimately affect our well-being.

Biodiversity offsetting has emerged globally as a response to this loss with the aim of achieving no net loss or a net biodiversity gain.

New Zealand's natural biodiversity

New Zealand is recognised internationally as a hot spot for biological diversity. We have a range of species that are endemic to New Zealand, meaning this is the only place in the world they can be found.

The ecosystems in which these species live are also very unique. The kauri forests of the northern North Island, the braided river systems of the eastern South Island, and our geothermal ecosystems are just a few examples.For example, New Zealand’s only terrestrial mammals (bats) are endemic, as are all four of our frogs, all 60 reptiles, more than 90% of insects and a similar percentage of marine molluscs. About 80% of vascular plants, and a quarter of all our bird species are also native to New Zealand.

Threats to our biodiversity

New Zealand was one of the last large land areas on earth to be settled by humans. Evolution in isolation has meant that our indigenous plants and animals are vulnerable to introduced species.

Settlers brought exotic species with them, and many of our plants and animals are not adapted to threats from these introduced predators.

Activities such as hunting and burning that took place after humans first settled here have also had a dramatic impact on our indigenous biodiversity.

Many of our original forests have since been converted to farmland and there has been extensive modification or loss of wetlands, dunelands, river and lake systems, and coastal areas. Our lowland ecosystems remain some of the most threatened and their decline is a continuing trend.

In the last 800 years, humans and introduced pests have caused the extinction of:

• 32% of indigenous land and freshwater bird species
• 18% of endemic sea bird species
• Three of seven frog species
• At least 12 invertebrate species such as snails and insects
• One fish, one bat and perhaps three reptile species
• Possibly 11 plant species

Today, introduced predators such as stoats and rats threaten a range of species with extinction. This includes national icons such as the kiwi and tuatara. Our forests are still at risk from mammalian browsers, such as deer and goats, and ongoing land use intensification poses threats, particularly for freshwater biodiversity.