Respondent 10 (Academic Researcher)
Interviewer(s): Me
Interviewee(s): Respondent

Respondent: So, as you know the project seeks to elicit stakeholder perceptions to biodiversity offsetting in the UK. I choose to study it because it is an instrument in quite rapid policy development but quite early theoretical development. I have also done a bit of work with SEI on corporate reporting on biodiversity and the evolving role of businesses towards the environment. I was particularly interested in your insight because you have spent many years working at the interface of science, business and policy making so hopefully you can provide a good insight into the design and implementation of offsetting. Perhaps the most divisive and pertinent debate around offsetting concerns its implications for development red tape around development and planning. So, if I could first ask you whether you think biodiversity offsetting is likely to lead to tighter or less stringent regulations around infrastructure projects.

Right, well I mean, it's an interesting one because obviously they are designed to simplify things in a sense in the fact you have a transparent metric which you are meant to use for all projects means that it should in principal be straight forward because what you are doing is saying in advance of the development of the project that the developers can know what metric and methodology can be applied and if they can do it themselves and it is not actually that difficult having developers in the UK presuming there will be less chance of it being questioned because it is a methodology the planning authority would also use. In principal it should do what they say it is going to do which is make it slightly easier. At the same time I mean what you are also doing is making the requirements more stringent for development in terms of biodiversity compensation. You are requiring no net loss rather than just some form of compensation which doesn't have to be demonstrated. But on the other hand, you are saying the requirements are having to increase on developers, the amount of compensation they have to provide and the need to provide evidence of no net loss rather than just some compensation which gets accepted by the planning authorities. So, to pretend that that won't be harder for the developer is maybe disingenuous. I kind of feel as though, in some respects it will create less work and in others it might create more for developers . I think that's a good thing because what we are saying is that biodiversity is not sufficiently taking into account within the planning system. So, we do need to do more about it. So that's fine, but the argument that it will cause less red tape and less work for developers is a little bit disingenuous.

Me: That's interesting. So, based on the kind of offsetting schemes and pilots that have been established, do you think that offsetting should be made mandatory for any type of infrastructure project?

Respondent: See, I saw this question on your thing and I actually think that's not quite the right question to be honest. I don't think biodiversity offsetting should be made mandatory or not mandatory, I think no net loss is what should be made mandatory or the mitigation hierarchy. So, I think that's the wrong way of posing that question personally because I don't think biodiversity offsetting should be made mandatory I think it should be mandatory to go for a no net loss in biodiversity and then infrastructure projects should be able to deliver however the best way of delivering that is. Ideally, that wouldn't involve any biodiversity offsetting. I think - and I have said this in a few different public fora - that I think that the idea of biodiversity offsetting policy is one in which there are hardly any offsets at all because you manage to discourage development in areas that are sensitive and you manage to push them all mitigation options up the mitigation hierarchy towards avoidance and minimisation. So, actually, if you can avoid biodiversity offsetting through an offset scheme that is the kind of idea. I think having some kind of no net loss in biodiversity and some quantitative empirical no net loss in biodiversity as part of infrastructure projects should be mandatory yes. But, that won't necessarily always include offsets. It probably will include some kind of offsets yes.

Me: So, do you think it would encourage mitigation higher up, it would encourage businesses, given the cost that are incurred through offsetting, development on brownfield sites or something?

Respondent: Well, I mean, that is the intention and that is what you see happening in countries where there is a bit more of a mature offset policy or programme and it has been in place for a while and is mandatory you do see it discouraging development. So, I did an Australian example where it has been in place 10 or 15 years and the because the requirement at the end of the mitigation hierarchy is to achieve no net loss so all native grasslands impacts have to be offset then you have to look for some native grassland offsets and because there aren't that many around it ends up becoming quite expensive to do so, so that tends to drive avoidance of those kind of habitats rather than destruction of them and then offsets. So, I think there is some evidence it can have that effect and I think that is kind of the idea.

Me: So perhaps, don't encourage biodiversity offsetting per se but encourage no net loss.

Respondent: Yes, the focus should be on no net loss. This is the mistake I think we have made in the UK so far. I think there has been this immediate leap towards biodiversity offsetting which is a controversial mechanism and isn't a proven mechanism yet even though it has had some success in some parts of the world. The focus should be on no net loss and I think people are starting to realise that now. I'm sure you know BBOP: Business and Biodiversity Offsets Programme. So, they have been out for a long time and have done a lot of the work and called the Biodiversity Offsets Programme and my impression is that sort of regret that a little bit now because I think they would rather focus on no net loss as a policy principal rather than on biodiversity offsetting. I think we will see that eventually in the UK. I think some of the people who are leading on this in the UK are starting, in their talks and in their articles they are writing and thinking basically in general are starting to say we should push towards no net loss as a focus or a net gain.

Me: Do you think no net loss as a policy goal is different to no loss that was previously enshrined in EU policy and maybe not UK, but EU. Do you think there is a different between saying we are aiming for no loss or we are aiming for no net loss?

Respondent: I am not hugely familiar with the no loss policy. When you say the no loss policy...

Me: I think it was established around the Natura 2000 network

Respondent: A no loss policy?

Me: Yes, so I think it was within the European Action Programme, reading the reports there is a slow shift from no loss as a policy goal to no net loss. I was just wondering if you think that is a more rigid and stronger policy stance or do you think it is changing the goalposts somewhat.

Respondent: To be honest I can't say I know a huge amount of detail about the no net loss and no loss principles. My feeling is, that in terms of practice at the EU, whatever this no loss policy, if it has been at the heart of the EU and things under the Habitats Directive and so forth, it hasn't been quantified, that is the difference in going towards no net loss policy is this idea of balancing losses and gains quantitatively which I do think is a big difference. I think it is the big shift in all of this. I think that's what makes it, rather than being an old idea in new clothes that's what makes it interesting is that we are actually saying, not just that we will compensate for losses or prevent losses but we are actually going to quantify what those losses are and require an equivalent gain. To me, that quantitative comparison between losses and gains is the interesting thing here and the thing that should be lauded rather than scare environmentalists.

Me: And in the process has the concept and development of offsetting encouraged the creation of a biodiversity indicator for the UK at the academic/research level?

Respondent: Biodiversity indicators for the UK?

Me: Yes, do you think it will encourage - the idea of measurement of no net loss - will it encourage the creation of an indicator which can then be streamlined into economic development and streamlined into all planning and development?

Respondent: Yes, this whole thing about developing indicators for biodiversity losses and gains and strategies and programmes is an ongoing thing which has a lot of interest from the academic world. There have been efforts, as a result of the Aichi targets and the CBD, like the Biodiversity Indicators Partnership and that kind of thing to develop national level indicators and indeed we have some national level indicators for biodiversity. Yes, I think all the ideas and the research that is being done around biodiversity offsetting and no net loss will lead to the development of useful metrics, especially for the private sector. There is a paper that has come out recently in Oryx which says these are the companies which have no net less policy commitments, there are about 30 or 35 of them, big companies and that is growing. There are more and more companies saying we will endeavor to achieve a no net loss of net positive impact on biodiversity and I think the private sector needs to play a much bigger role in biodiversity compensation and I think it will be able to do so through these kind of ideas and no net loss principal. I think, the application of research into useful indicators for biodiversity will benefit and be useful to the private sector much more than in the public sector is my feeling, whether that is right or not I'm not sure.

Me: So, on this there appears a lot more commitment to no net loss goals, do you think at the moment, currently in the UK, there is an enabling theoretical or policy framework for fulfilling those goals? Or do you think there is a mismatch between the development of those commitments and a framework for fulfilling those commitments?

Respondent: For private companies or the public sector?

Me: For private companies

Respondent: Yes, I think there is a gap, it is the kind of commitment people are starting to make without necessarily knowing how they are going to deliver it. I think the companies that have made the commitment over the last 5 or 10 years, which is the kind of time scale we are talking, some of them have made that commitment a while ago and are starting to realise that it is quite difficult to deliver which you might expect. It sounds good, but the reality if you can't deliver it, especially when there isn't really necessarily a framework that exists that allows companies to do that because experience is still limited and there is still not that many companies that do it on the big scheme of things. I think, you are right to say there is a gap between the kind of policy commitment and framework for implementing that policy. I would add, something that has come up a lot recently is the whole difference between no net loss and net positive impact or net gain. So, your average company, if they are considering this, they will say, no net loss is all very well, that would be a laudable thing to do, but it kind of sounds a bit negative, it would be better if we could say a net positive impact. That is the kind of languages companies like. It is perceived that the difference between no net loss and a net positive impact is quite small. You just go a little bit further from no net loss and you have got a net positive impact. Whereas the reality is quite different and it is something I am working on with a few other people at the moment is this principal of how difficult it is to transition from no net loss to a net positive impact and how much extra work it involves - and I think it is actually a lot of extra work. So, just as a side note I would say that is something important as well.

Me: And in the design of offsetting, particularly with big companies, mining, and extractive industries in the UK elsewhere, especially with fracking discourse in the UK. I was wondering, when undertaking offsets do you think compensating affected communities is always necessary and practical in the design and implementation?

Respondent: Compensating in what way?

Me: Not ecological communities, social communities, so where the development site is, supposing there is access to an area of land previously, should there be commensurate access to that land in the offset site or do you think the idea of social compensation is kind of not really linked to biodiversity offsetting or shouldn't be linked?

Respondent: No, I think what is interesting here is it depends a lot on the national context this question. So, the question of whether in the UK there should be compensation of affected communities I would say absolutely, because in terms of what we value in biodiversity because we are a small island which is heavily developed with lots and lots of people living very close to each other I think access to nature is a huge part of the value of the remaining biodiversity. So, I would say, actually yes, it is crucial that biodiversity offsetting incorporates considerations of affected communities and access to nature for those affected communities which has to be considered. I don't think that is a general thing about biodiversity offsets, I think in other parts of the world, for instance, I do a lot of work in central Asia, maybe you know, and in the parts of the world I work there it is very remote the areas we are talking about and a few scattered tiny communities and there is a few scattered oil and gas, industrial oil and gas and mining operations. Access to nature is just not a problem, I mean they are surrounded by it. If anything they want less nature, it's kind of what you are trying to do there is probably less about ensuring the affected communities retain some kind of access to nature because they have that, it would be quite hard to take that away from them and more about what the value they get from biodiversity is and the regional value of biodiversity which is slightly different. So, I mean obviously you still need to consider affected communities, I'm not saying that but, in terms of access to nature and local access to nature it is less of an issue.

Me: And given the important you see access to nature in the UK, do you think the issues of social compensation or access to nature are being articulated in the design and implementation within a UK context or not really at the moment.

Respondent: So, in terms of the existing biodiversity offset suggestions for a biodiversity offset policy?

Me: Yes, the Defra metric, is there a parameter in the Defra metric or not?

Respondent: I don't think it is particularly well covered which is making a lot of people nervous about the Defra metric but I think the reality of it is, because the UK planning system, because all of this is going to be going through local planning and so forth, I can't imagine local planning authorities kind of allowing impacts that are then offset kind of 300 miles away in a different county. I would have thought the UK planning system has sufficient locality built into it that those missions that are going to be granted that involve biodiversity offsetting won't generally allow something to be torn down which is kind of of value to one of the local communities and then compensate it for something miles and miles away, but I don't think that is sufficiently, I don't think sufficiently is the right word, I don't think that is really incorporated into the Defra metric at the moment, no.

Me: So do you think it should be a parameter, explicitly? Speaking to a few offsetters, researchers and academics they say on the ground it is implicitly recognised as an important idea, but do you think it should be explicitly represented within the metric?

Respondent: Well I think it should, but I'm not sure how much extra it would take for them to add. I think South Africa is doing quite well, they just have a level at the start of the decision making process for developing offsets where you say if the biodiversity offset is going to take away biodiversity utility from a certain community or any sort of ecosystem service then that's a kind of yes-no part of the decision tree, you can't just take away any kind of ecosystem service provision to a community and give it to a different one as part of an offset scheme. So, that would include utility value and access to nature and I think something like that could be made part of the Defra process without too much difficulty. I mean, in practice it makes it quite difficult in terms of actually finding an offset, so I think it would be easy to say you should do this as part of the policy, to then actually find biodiversity offsets for development projects that do provide that access to nature is going to be difficult. I wouldn't necessarily say that is a bad thing because, again, using the Australian example, that is what makes it more expensive to develop these habitats that we care about and don't want to lose. So, that is what drives the developers to look at more minimisation or avoidance measures which is kind of the point.

Me: That's really interesting actually, you have probably provided the best insight on that question definitely. Have you got the questions in front of you?

Respondent: Yes

Me: Ok, going on to the agenda building capacity of biodiversity offsetting - because it is referred to as a market based instrument or it is likely to develop as one, as a market evolves for offsetting, what do you think the role of market based instruments are in reversing biodiversity loss compared to traditional forms of standards and planning regulations.

Respondent: Well, it is interesting because a lot of people don't consider offsetting to be a market based instrument - or it shouldn't be seen as a market based instrument. But, putting that debate aside, I think we have to bring biodiversity into markets and I think we have to find a way to showing the actual financial value of nature in order to really get serious about preventing biodiversity loss and I think there is probably a few different ways of doing that. I think using some kind of no net loss target system where you have certain habitat types that we really value or we think are particularly well suited to it. I think, having some kind of biodiversity market is crucial to giving that value and making it worth saving for those which have ownership of that biodiversity value, existing ownership. I think it's not just that; in general, the role of the private sector as part of an expanding role of the private sector and biodiversity conservation, which I do think we need to do and I don't think we can avoid that, we need to find ways to make it valuable and I think market based instruments are a way of doing that. At the same time, it is going to continue being incredibly controversial and I know there is a huge number of those working in biodiversity conservation and in conservation in general - so it is the absolute antithesis of biodiversity conservation to start valuing nature. You have got people like George Monbiot, lots of academics like Bill Adams, people like that, who are very well established and very bright and very influential environmentalists who just don't think we should ever be valuing nature and this sort of thing - because you can't. And they are right that you can't capture the full value of nature through financial evaluation, but what you can do is use it as a tool for giving it a value in the market place so it doesn't just get destroyed.

Me: So, do you think you should derive economic values from ecological values of biodiversity when you are calculating biodiversity units with the Defra metric - should that then be transformed into an economic value then be traded within a market situation or do you think it should just remain as a biodiversity unit or ecological valuation?

Respondent: No, more specific to biodiversity offsets rather than market based instruments in general I think we should kind of try to avoid that more than not really because I think biodiversity offsetting is only really going to work for a small number of habitats and I think certainly in the UK we should at least start by limiting it to those habitats rather than creating a market with lots of different habitat types being traded as credits to see if we can get it to work for those and I think also - I just don't think it is the way to go to start transforming it into abstract values and trading it on an open market. Also, what you do then is you start to create a big market and then your driving forces create a sufficiently big market that the credits have value and they actually exchange hands. Again, I don't think that's what you want to do - I think what you want to do with biodiversity offsetting specifically is create a thin market - you want the value of biodiversity on privately owned land to become so high that it is worth more to sell as a biodiversity offset and then that is bought but also discourages developers from developing those patches of land which we value as a society.

Me: Yes, that's definitely a more nuanced position than different respondents. Planners were saying they see offsetting solely as a tool for development, that should be used within a particularly context of that development. But the offsetters were seeing it as an ecosystem marketplace so trading biodiversity offsetting between companies and between landowners. So it seems you're kind of in the middle.

Respondent: Yes, I guess so.

Me: So, what kind of opportunities and risks do you think are posed by the private sector provision of offsetting in terms of landowners leasing their land for offsetting or non-agricultural uses.

Respondent: I think it gives biodiversity value which wasn't their before. So, at the moment, if someone has - which is something that has been reflected in research that has been done in the states - is that without an offsetting scheme in general, a lot of the time you have biodiversity value which becomes seen as a liability because it gives you extra considerations, extra obligations, it gives you barriers to developing that land, so it is seen as a liability. Whereas the opportunity in creating an offset scheme is that that then hopefully becomes seen as something valuable - transforming a liability into an asset. So, that's one of the big opportunities. I think it's also an opportunity to review the way we do biodiversity compensation and mitigation as part of planning and improve it, because it does need improvement, it really does. The current system clearly isn't working so I think so I think we have an opportunity to start quantifying losses and gains. So, from that point of view that is an opportunity as well.

Me: Perhaps just tying everything together, if you had the metric in your hand, because it is being developed at the moment and is not finalised, what kind of parameters would you introduce across any kind of dimensions: social, legal, ecological, economic to ensure that it is working effectively in the design and implementation stages?

Respondent: I think one of the things we need to do it restrict the habitat types that are used within it, so I think, rather than having an all-singing, all-dancing metric that can do all different types of habitat types, I think we should note we are going to start using this for a certain type of habitat, say grassland or something like that - so a certain group of habitats that we want to conserve, so I would start by saying the metric should only apply to these; just because wherever it has been used in other places and been matured and become successful it has been limited to a certain type of habitat or species which is kind of still I think necessary. So, it's picking that list of habitats. I think, there is quite an important thing to do around baselines and counterfactuals which we haven't done with this metric at the moment. So, we need to not only say we treating it as a static problem where we have losses on one hand and gains on the other hand - and if they are equal that's fine - I think there also needs to be some kind of component with the metric that says what is the background trend in this component of biodiversity. So, for instance, if you have got a certain type of grassland that is deteriorating anyway as a result of lack of management or climate change, or some kind of ongoing trend, then you can allow some kind of avoided loss. Whereas if it is a stable habitat type then maybe you obviously need to swing something additional, some kind of proactive habitat creation. So, I would say, some kind of consideration of background trends, a baseline and counterfactuals. I would also take a look at multipliers which are being used at the moment which are dispositionally poked out of the air and there has been some work done in the literature into different types of multiplier and some kind of theoretical basis for actually devising them. The ones we have at the moment are literally pulled out of the air, I know, because I know the guy who developed them and he told me, but I think they should be a bit larger than they are and I think that there should be some kind of basis for them. Whether that is taken from the academic literature or experience in South Africa - I'm not sure - but I think they should incorporate... In South Africa they have a really nice way of doing it in which they look at the type of habitat being affected and the biodiversity value of that habitat or status of that habitat. Also, cumulative development in that habitat across the country or the region.

Me: So, are you referring to ratios when you refer to multipliers.

Respondent: Yes, exactly

Me: So, time discounting as well?

Respondent: Yes, for the time discounting one at least we had some kind of basis in the UK because that is actually based on a discount rate so that's saying well this is our standard discount rate and that's fine, but I more mean, issues around uncertainty of restoration and uncertainty in implementation. So, I think the multiplier needs to be worked on. So, what have I said so far - habitat type, ratios, multiplier and we did talk earlier about social compensation and the affected communities. So, I do think it would be good to have some kind of filter in there for ecosystem services provided to different communities but that is actually quite complicated.

Me: But, you do think it should be explicitly represented, or attempted to be?

Respondent: I think it should be ideally.