1. Qld Environmental Law
Association Annual Conference
29 May 2014
Jason Richard (Principal Ecologist)
Queensland Office
Level 22, 127 Creek Street, Brisbane

2.  What is an offset?
 Principles underpinning offsets
 Challenges to effective offsetting
 The new Queensland Environmental Offsets Policy
 Limitations of the new (and old) framework

3. The Productivity Commission in its 2013 review of major project
assessment processes described environmental offsets as:
“environmentally beneficial activities that counterbalance or
compensate for the adverse impacts of a development on the
environment.”

4. No net loss
Species composition,
habitat structure,
ecosystem function
Significant
adverse
residual
impact
Net gain
Avoid, reduce and
mitigate
Counterbalance
Compensate
People’s use and cultural
values
Measurable
conservation
outcomes

5. A) Remnant Brigalow ecosystem B) Regrowth Brigalow ecosystem
How much of B do you need to make up for loss of 1ha of A?

6. Protecting habitat which already exists = net loss

7. Relying on restoration/revegetation = net loss
Source: Bekessy et al (2010)

8. 1. +
= ?
?
Equivalence?

9. 1. Restoration is feasible.
2. Clearing threaten a species,
population, or ecological
community.
3. Adaptive management.
4. Offsets provide values for periods
commensurate with impacts from
clearing.
5. Adequate auditing and compliance.

10. 1. 2002 – Fish Habitat: Mitigation and Compensation for
Works or Activities Causing Marine Fish Habitat Loss
2. 2005 – Policy for Vegetation Management Offsets
3. 2006 – Offsets for Net Gain of Koala Habitat in Southeast
Queensland Policy
4. 2008 – Queensland Government Environmental Offsets
Policy
5. 2011 – Biodiversity Offset Policy
6. 2014 – Environmental Offsets Act and single Queensland
Environmental Offsets Policy

11. 1. Five overlapping policies.
2. State and Federal policies trading in different currencies
(RE’s vs habitat/ecosystems).
3. Lack of clarity around when offsets are required.
4. Multipliers which varied within and across policies.
5. Lack of “off the shelf options”.
6. Lack of clarity around financial settlement offsets.
7. Constantly shifting policy – several iterations over life of
single project.
8. Difficulty in locating appropriate offset sites.

12. 1. A ‘one stop’ for environmental offsets.
2. A new Queensland Environmental Offsets Policy.
3. Applies to prescribed activities and prescribed
environmental matters.
4. Includes new (off the shelf) tools such as Direct Benefit
Management Plans and Strategic Investment Corridors.

13. Environmental Offsets Act (2014)
• Provides the foundation an offset and how it is provided.
• Defines prescribed activities (section 9), for which an offset
may be required.
• Defines prescribed environmental matters (section 10);
• Establishes the concept of significant adverse residual
impact.
• Establishes the Offset Account, administered by DEHP;
• Gives effect to the new Queensland Environmental Offsets
Policy.

14. When the Policy Applies
1. Where ‘prescribed activities’ result in significant adverse
residual impacts to ‘prescribed environmental matters’,
including:
• A Matter of State Environmental Significance (including
an existing offset area);
• An accredited Matter of NES;
• A matter of local environmental significance under a
local planning scheme
2. Offsets may not be required where there is a significant
residual impact on a prescribed environmental manner

15. Offset delivery
1. Authority holder must notify administering agency of
intended approach prior to commencement of activity.
2. Greater emphasis on financial settlement.
3. Proponent-driven (land based offsets, DBMP, Strategic
Benefit Investment Corridors) remain an integral
component.
4. Combination of financial settlement and proponent-driven
offsets possible.
5. Draft Financial settlement offset calculator available.

16. Offset Ratios
1. Capped at 4:1 for most values.
2. Up to 10:1 for protected areas.
3. 3:1 for Koalas in SEQ, plus 3 x
on ground costs.
4. As low as 1:1 for some values.

17. Financial Settlement Offsets
1. An authority holder can acquit offset obligations for
marine/aquatic and terrestrial environments via payment to
the Offset Account.
2. On ground operations may commence when payment is
received.
3. Standard payment is based on the following formula:
Financial settlement = (total offset area on ground x cost per
ha + landholder incentive payment + admin cost)

18. Financial Settlement Offsets – Example

19. Financial Settlement Offsets – Example
Clearing 35ha of Wallum Froglet habitat, Maroochydore
Financial settlement = (total offset area on ground x cost per
ha + landholder incentive payment + admin cost)
Total offset area on ground: 35 x 4 (multiplier) = 140ha
Cost per ha: 140 x $20,000 = $2,800,000
Landholder incentive: 140 x $17,694 (UV/ha) = $2,477,160
Admin cost: 25% = $700,000
TOTAL = $5,977,160

20. Proponent-driven offsets
• Must deliver a conservation outcome:
A conservation outcome is achieved by an environmental
offset for a prescribed activity for a prescribed
environmental matter if the offset is selected, designed
and managed to maintain the viability of the matter.
• Legally secured – although offsets can be cleared?
• Must be set out in an Offset Delivery Plan.
• Can be delivered solely via Direct Benefit Management Plan.

21. Limitations – capped multipliers
• The Policy seeks to cap risk multipliers at 4:1 for most
matters.
• Aside from being arbitrary in nature, experience tells us
these are unlikely to be adequate to accommodate risk of
failure.
• For example – Green and Golden Bell Frogs at Sydney
Olympic Park, ultimate offset ratio 19:1.
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

22. Limitations – ‘no net loss’ and like for like?
• No recognition of irreplaceability.
• Substitution of values (that is, offsetting the clearing area
with a different, albeit similar value) and provision of offsets
hundreds of kilometres from the offset site.
• Habitat or ecosystem-based approach can be likened to
grouping overlapping but often quite separate goals.

23. Limitations – Irreplaceability

24. Limitations - time lag in delivery and restoration uncertainty?
• There is no offset framework in Australia which adequately
addresses time lag.
• Ideally, the offset would prove itself before the value was
removed.
• Uncertainty around restoration can be factored in to the
equation.

25. The positives – strategic investment
corridors
• Landscape context.
• Investment in strategic corridors.
• Potential to reduce ad hoc delivery
of offsets.
• See Galilee Basin Offset Strategy for
an example.
• Doesn’t guarantee you’ll meet EPBC
Act requirements.

26. The positives – defining significant residual impact
• Determining whether an impact is significant should not fall
to the proponent – guidance is required.
• Offsets Act defines ‘significant residual impact’.
• Guidelines will be developed to determine what is, and what
is not, a significant residual impact.
• Reduced costs and increased certainty for proponents.

27. The unknowns
• Offset assessment guide (calculator)
• Habitat quality assessment guideline
• Self administered Code of Compliance

28. • Offsets are a critical policy tool.
• Streamlined but potentially costly to implement.
• There is a price to pay for certainty through a financial
settlement.
• Engage the process early and seek advice on delivery
options for offsets.
• Ensure that the dialogue extends to the C’wlth.
• Invest in comprehensive baseline studies.

29. Jason Richard - 0425 881 087
Principal Ecologist
Level 22, 127 Creek Street, Brisbane
Adelaide - (08) 8372 7829 / Brisbane – (07) 3221 3352
Geelong – (03) 5221 8122 / Melbourne – (03) 9377 0100
www.ehpartners.com.au