A U.S. perspective on England's Biodiversity Net Gain

Sharing a new paper by Maya Patel of the Harvard Kennedy School on Biodiversity Net Gain in England , written for EPIC.

England's Biodiversity Net Gain law and requirements for all new development to more than fully offset impacts on nature is among the most important new directions for environmental policies on the planet.

I put it at the top of the list because its really a comprehensive action that for the first time means that impacts to nature must be fully internalized into business decisions and costs - for all wildlife and plant species and ecosystems. To put that in perspective, the U.S. Endangered Species Act covers only 1% of U.S. biodiversity and by law in most situations (especially for government action), you only need to do your best to make impacts as small as possible and are still allowed (by law) to push species closer to extinction. England's BNG law will surely have many struggles and predictable failures along the way once it comes into force in November 2023, but this incredible goal of requiring net gain is a beacon on which to improve the structures to implement it.

We were thrilled to work with Harvard graduate student, Maya Patel, on a review of England's nascent Biodiversity Net Gain program, regulations, and principles and you can find Maya's paper here . Maya did a great job of relating programs from the U.S. like in lieu fee programs, and North Carolina's state-run mitigation program with the system that is evolving in England.

However, I especially want to note the section on BNG program risks in the paper. Many of these are not hypothetical - they will happen, at least on a case by case basis, and the Guardian will write about them as if they are fundamental flaws in the whole idea of offsetting as opposed to optional choices in implementing the policy that can be learned from and improved.

• Underpricing Statutory and LPA Credits - England is appropriately worried about supply of credits not matching development needs and they are addressing that by building a system where developers can pay a fee which is transferred from the Treasury agency to a quasi-governmental organizational tasked with building biodiversity banking projects. But if the agency gets the pricing wrong by setting it too low - as all US agencies that have tried this have done - there won't be enough money for the restoration and it will also undercut private sector projects that are well-priced.
• Onsite offsetting risk - England is allowing lots of enhancement activities on the developed property to count as beneficial. Many U.S. organizations encourage this too. While it might be good for the aesthetics and recreation opportunities for the people who live nearby, its often going to result in a long-term outcome for biodiversity that is less good, because of all the invasive species, predators (i.e. cats), and other threats that proximity to humans make worse. This is why England's rapidly growing private sector biodiversity banking niche is so important for nature.
• Local Capacity and Technical Expertise - Local government agencies have to run a lot of the permitting and learning how to do so is hard and costly. They are going to make mistakes. That's okay and unavoidable, but the national government has to figure out how to help them learn and adapt fast.
• Monitoring, Evaluation, and Noncompliance Risk - Keeping track of whether environmental results that are supposed to happen actually happen is always a worry but often overblown, if the government program is designed to wait for strong signals that restoration works before letting all the monetary value of ecological restoration be sold. U.S. systems are getting better at this, but its not clear that England's is set up to incentivize advance restoration as much as is needed.
• Metric Oversimplification Risk - Simplicity is critical and lack of it is one of the main reasons that ecosystem market ideas fail in practice. England's already on version 4.0 of its metric and this is one of the best examples we have seen of a true innovation process being put in place by a nature agency. But there are still going to be weak points and loopholes where a poor restoration project get too many credits or a damaging development is assigned too low of impacts. That is not a fatal flaw, its an expected result of a new program. The key question is whether the system can adapt and learn without crushing itself with complexity. If the vast majority of projects are providing real value and the metric is approximately on target most of the time, the media won't cover it, but that is the real indication of success.

Maya also talks about durability risks, temporal risks, conflicting priorities (i.e. doing things that are really about benefiting people and calling them actions for biodiversity), and impacts to development that England needs - whether that is for low income housing, well-paid jobs, or clean energy work. All this and more is in the paper!