Presentation delivered at the 15th Annual BIOECON Conference 18‐20 September 2013, Kings College Cambridge, England

1. A birdin the hand is worthtwoin the bush:
ecologicaltimepreferenceandbiodiversityoffsets
15th Annual BIOECON Conference
18‐20 September 2013, Kings College Cambridge, England
Megan C. Evans1*, Martine Maron2, Phil Gibbons1, Hugh P. Possingham3
1 Fenner School of Environment and Society, The Australian National University, Australia
2 School of Geography, Planning and Environmental Management, The University of Queensland, Australia
3 Centre for Biodiversity and Conservation Science, School of Biological Sciences, The University of Queensland, Australia
megan.evans@anu.edu.au
@megcevans

2. Atreeforatree:
Biodiversity offsetting
• Broad goal is to achieve no net loss of biodiversity
(Bull et al. 2013, Gardner et al. 2013)
• Rapid growth in uptake: policies exist in 45 countries,
and in development in another 27
• Wetland mitigation banking (USA), BioBanking (NSW), Bushbroker (Vic),
EU ‘no net loss by 2020’ , UK pilots, EPBC policy (Australia)
2
Gibbons and Lindenmayer (2007) Madsen et al. (2010). State of the Biodiversity Markets Report
Total Wetland and Stream Mitigation
Banks (USA) 1980-2009

3. “…[biodiversity offsetting]
could revolutionise
conservation in England
by delivering restoration,
creation and long term
management on in excess
of 300,000 hectares of
habitat over 20 years".
BBC.co.uk, 31 July 2013
“Biodiversity offsetting
will unleash a new spirit of
destruction on the land”
- UK Ecosystems Markets Task Force
- George Monbiot, The Guardian

4. Calculationoffsetrequirements
Key considerationsfor biodiversityoffsets
• Mitigation hierarchy is adhered to
• Limits to offsetting (Pilgrim et al. 2013)
• The type of biodiversity being impacted (‘like-for-like’ or comparable)
• Offsets are additional: benefit is the difference between status quo and
the impact and offset scenario (Maron et al. 2013)
• Uncertainties, including offset likelihood of success (Moilanen et al. 2009)
• the threat status or vulnerability of impacted biodiversity (BBOP 2012)
• the time delay between the ecological impact and delivery of the offset

5. Offsetmultipliers
• Multipliers are commonly used to increase offset
requirements in an effort to better account for
uncertainty, species or ecosystem threat status, and time
delays.
• However…
• Selection often arbitrary
• Lack transparency
• May lead to over- or under-estimation
of offset requirements
Pickett et al. (2013)
Green and golden bell-frog (Litoria aurea)

6. Accountingfortimedelays
Discounting
• Can be used to account for:
• Pure time preference (PTP)
• Loss of utility due to time delays
• Exogenous risks (Overton et al. 2013)
• Employed by some offsetting policies, but no clear guidance
for selection
• UK: 3.5% (Defra, 2012)
• NZ: 1% (Denne and Bond-Smith, 2012)
• Can have a large influence on offset requirements

7. Accountingfortimedelays
Discounting
“the assessment of what is an adequate offset is concerned only
with the biodiversity outcome, not with the financial costs of
retaining or replacing it”. (Denne and Bond-Smith , 2012)
“…standard expected utility theory suggests one reason for
discounting future consumption, namely, the possibility that we
will not be around to enjoy it. As individuals, we face a typical
annual mortality risk of around 1%, and it makes sense to
discount future utility by this amount.” (Quiggin, 2008)

8. Accountingforspeciesvulnerabilityandtimedelays
‘Ecologicaltime preference’
?

9. Accountingforspeciesvulnerabilityandtimedelays
‘Ecologicaltime preference’
?

10. Accountingforspeciesvulnerabilityandtimedelays
‘Ecologicaltime preference’
?
Bettongia penicillata (CE)
Calyptorhynchus banksii
graptogyne(E)

11. Accountingforspeciesvulnerabilityandtimedelays
‘Ecologicaltime preference’
•
Threat Status
IUCN Criteria for
Probability of
Extinction in the Wild
Annual Probability of
Extinction
(Geometric mean)
Critically Endangered At least 50% in 10 years 6.7%
Endangered At least 20% in 20 years 1.1%
Vulnerable At least 10% in 100 years 0.1%
Bettongia penicillata (CE)
Calyptorhynchus banksii
graptogyne(E)
IUCN (2001)

12. EPBCAct (1999) EnvironmentalOffsetsPolicy
• Environmental Protection and Biodiversity
Conservation Act (1999)
• Regulates impacts on Matters of National Environmental
Significance (MNES)
• 1310 threatened flora, 446 threatened fauna, 66
ecological communities, + migratory spp,
World Heritage sites
• Draft offset policy 2007, public consultation on new
draft ~2011
• Consultation on metric (P Gibbons) early 2012,
NERP-ED project mid-2012, policy delivery October
2012
Miller K, Dripps K, Trezise J, Kraus S, Evans MC, Maron M, Gibbons P, Possingham HP. In prep.
A metric for determining biodiversity offsets under a regulatory framework
Decision Point #69
www.decision-point.com.au

13. EPBCActEnvironmentalOffsetsPolicy
Policyprinciples
Suitable offsets must:
1. improve or maintain viability of protected matter
2. be built around direct offsets but may include other compensatory
measures
3. in proportion to the level of statutory protection that applies to the
protected matter
4. be of a size and scale proportionate to the residual impacts on the
protected matter
5. effectively account for and manage the risks of the offset not succeeding
6. be additional to what is already required
7. be efficient, effective, timely, transparent, scientifically robust and
reasonable
http://www.environment.gov.au/epbc/publications/environmental-offsets-policy.html

14. Loss-gain metric
•
Gibbons P, Evans MC, et al. In review. Methods in Ecology & Evolution.

15. Loss-gain metric
• Impact calculation based on most relevant attribute/s:
• Area of habitat or community
• Number of features
• Condition of habitat
• Birth rate
• Mortality rate
• Number of individuals
• Offset calculation uses inputs from impact calculation to
determine the % of impact compensated
Time horizon
(years)
Start value
Gibbons P, Evans MC, et al. In review. Methods in Ecology & Evolution.

16. ‘Ecologicaltimepreference’andbiodiversityoffsets
Key conclusions
• Provides a robust scientific basis for discounting
biodiversity offset requirements
• Avoids arbitrary selection of threat-based multipliers
• PTP may still be considered (e.g benefit-cost analysis of offset delivery),
but must first satisfy ‘no net loss’ criterion
• Places an indirect price on biodiversity that is
differentiated based on vulnerability
• A generic discount rate implies humans place no greater preference over
a critically endangered species compared to a common species
• Incentivizes larger offsets (and adherence to mitigation hierarchy) for
more threatened species
• Explicit consideration of “offsetability” (c.f Pilgrim et al. 2013)

17. ‘Ecologicaltimepreference’andbiodiversityoffsets
Next steps
• Analyse offset requirements under
alternative scenarios:
• discount rate, time length, species & offset
response curves
• RobOff (Pouzols, Burgman and Moilanen, 2012)
• Offset metric comparison:
• ‘instantaneous’ value of impact and offset
(Gibbons et al. in review), vs.
• cumulative values (Overton et al. 2013)
• Case study – Red-tailed black cockatoo
(Maron et al. 2010)
Figure from Arponen et al. (2005)

18. Questions?
18
E: megan.evans@anu.edu.au
T: @megcevans
W: economical-ecology.com
www.nerpdecisions.edu.au
www.ceed.edu.au
CSIRO Climate Adaptation Flagship Top-up Scholarship www.csiro.au
Thankstosupportfrom
Mysupervisors:
Dr.KarenHussey &Dr.PhilGibbons(ANU), Dr.StuartWhitten &Dr.TaraMartin(CSIRO)

19. References
Bull, J.W., Suttle, K.B., Gordon, A., Singh, N.J. & Milner-Gulland, E.J. (2013). Biodiversity offsets in theory and
practice. Oryx, 47, 369–380.
Department for Environment, Food and Rural Affairs (Defra), (2013). Biodiversity offsetting in England: Green paper.
Denne, T. & Bond-Smith, S. (2012). Discounting for Biodiversity Offsets. Covec, Report prepared for NZ Department
of Conservation.
Gibbons, P. & Lindenmayer, D.B. (2007). Offsets for land clearing: No net loss or the tail wagging the dog? Ecological
Management & Restoration, 8, 26–31.
Gibbons P, Evans MC, Maron M, Gordon A, Le Roux, D, von Hase, A, Lindenmayer, DB and Possingham, HP. In
review. Key guiding principles for biodiversity offsets translated into a simple assessment methodology. Methods
in Ecology & Evolution.
Gardner, T.A., Von Hase, A., Brownlie, S., Ekstrom, J.M.M., Pilgrim, J.D., Savy, C.E., Stephens, R.T.T., Treweek, J., Ussher,
G.T., Ward, G. & Ten Kate, K. (2013). Biodiversity Offsets and the Challenge of Achieving No Net Loss. Conservation
Biology
Madsen, B., Carroll, N. & Moore Brands, K. (2010). State of Biodiversity Markets Report: Offset and Compensation
Programs Worldwide.
Maron, M., Dunn, P.K., McAlpine, C.A. & Apan, A. (2010). Can offsets really compensate for habitat removal? The
case of the endangered red-tailed black-cockatoo. Journal of Applied Ecology, 47, 348–355.
Moilanen, A., van Teeffelen, A.J.A., Ben-Haim, Y. & Ferrier, S. (2009). How Much Compensation is Enough? A
Framework for Incorporating Uncertainty and Time Discounting When Calculating Offset Ratios for Impacted
Habitat. Restoration Ecology, 17, 470–478.

20. References
Maron, M., Rhodes, J.R. & Gibbons, P. (2013). Calculating the benefit of conservation actions. Conservation Letters
Overton, J.M., Stephens, R.T.T. & Ferrier, S. (2013). Net present biodiversity value and the design of biodiversity
offsets. Ambio, 42, 100–10.
Pickett, E.J., Stockwell, M.P., Bower, D.S., Garnham, J.I., Pollard, C.J., Clulow, J. & Mahony, M.J. (2013). Achieving no
net loss in habitat offset of a threatened frog required high offset ratio and intensive monitoring. Biological
Conservation, 157, 156–162.
Pilgrim, J.D., Brownlie, S., Ekstrom, J.M.M., Gardner, T. a., von Hase, A., ten Kate, K., Savy, C.E., Stephens, R.T.T.,
Temple, H.J., Treweek, J., Ussher, G.T. & Ward, G. (2012). A process for assessing offsetability of biodiversity
impacts. Conservation Letters,
Pouzols, F.M., Burgman, M.A. & Moilanen, A. (2012). Methods for allocation of habitat management, maintenance,
restoration and offsetting, when conservation actions have uncertain consequences. Biological Conservation, 153,
41–50.
Quiggin, J. (2008). Stern and his critics on discounting and climate change: an editorial essay. Climatic Change, 89,
195–205.
Regan, T.J., Taylor, B.L., Thompson, G.G., Cochrane, J.F., Ralls, K., Runge, M.C. & Merrick, R. (2013). Testing Decision
Rules for Categorizing Species’ Extinction Risk to Help Develop Quantitative Listing Criteria for the U.S.
Endangered Species Act. Conservation Biology
Salzman, J. & Ruhl, J.B. (2000). Currencies and the Commodification of Environmental Law. Stanford Law Review,
53, 607–694.
Walker, S., Brower, A.L., Stephens, R.T.T. & Lee, W.G. (2009). Why bartering biodiversity fails. Conservation Letters,
2, 149–157.