The Australian government on Wednesday introduced its world-first nature repair market legislation into parliament, though concerns remain over what some consider fundamental gaps in the legislation.
Environment and Water Minister Tanya Plibersek said the market would make it easier for businesses, philanthropists, and others to invest in conservation work, and reward landholders for carrying out those efforts.
“That’s what this legislation is about: connecting people who want to invest in nature repair, with the people who can do that work on the ground,” she said.
Its objectives are to promote the enhancement or protection of biodiversity in native species in Australia, according to the legislation, and contribute to Australia’s international and national biodiversity commitments.
It also establishes the machinery needed to create the nature repair market, including the registry, rules, and regulator.
WHAT’S IN, WHAT’S OUT
The text of the 246-page bill is largely unchanged from the draft legislation the government released for consultation in December.
However, the Australian Land Conservation Alliance (ACLA) said several of its recommendations were adopted into the legislation’s final text.
This included strengthening biodiversity integrity standards to align them with the relevant recommendations of the independent review of Australia’s carbon market.
There is now an explicit reference within the bill to long-term environmental protection, with projects having a permanence period of 100-years once they get registered.
Additionally, the minister can now give regard to cultural impacts when making or varying market methodologies.
Several recommendations regarding the independent advisory committee overseeing the market have also been adopted.
There is now a requirement to have at least one biodiversity expert on the market’s Independent Advisory Committee, which has now been provided with oversight and review powers regarding biodiversity assessment instruments, prescribing requirements to be complied with by market methods.
The committee also now must not publish submissions to its consultations that “could reasonably be expected to substantially prejudice indigenous cultural heritage, or biodiversity”.
However, long-held concerns with the previous iterations of the bill remain, chiefly that it does not explicitly rule out biodiversity certificates generated as part of the scheme being used for offsetting purposes.
Commenting on the legislation, ACLA CEO Jody Gunn said she was supportive of the government’s intent of establishing the market, but said members were not supportive of the market being used as an offset scheme.
“We … want a market that delivers on ‘nature repair’ rather than ‘nature neutral’. Working through the detail on any forthcoming environmental offsets standard – as part of the government’s broader package of environmental law reform – will therefore be crucial,” she said.
The lack of clarity around whether certificates under the scheme can be used for offsetting purposes was a major concern as well for Rachel Morgain, policy and innovation director at the Biodiversity Council.
“The certificate approach in the bill is designed for a voluntary market delivering a range of broadly defined benefits. It is not designed to deliver projects that would meet the requirements for biodiversity offsetting under legislation,” she told Carbon Pulse.
“This has not been addressed in the current draft, which remains a serious concern when the government has not ruled out – and indeed likely intends – to use the market for biodiversity offsetting.”
With no provisions in the bill to protect the integrity of credits or the assurance needed for the market to deliver no net loss or better, the scheme will likely accelerate Australia’s biodiversity loss, according to Morgain.
She also said the bill lacked a number of fundamental provisions for it to work, such as outcomes-based assessment, improvement mechanisms, or complaints mechanisms for independent members of the public.
“Without tighter integrity provisions, with consequences for non-delivery, this will drive towards market failure,” Morgain said.
Meanwhile, Gary Wyatt, managing director of carbon project developer Corporate Carbon and chairman of its subsidiary Paniri Agriculture, raised previous concerns that the government was expecting the private sector to act as the main buyer in the market.
“In order to get this new market off the ground, we can’t expect the private sector to do all of the heavy lifting,” he said.
“The government can and should kick-start the market by committing to purchasing certificates itself, as it did effectively with the carbon market almost a decade ago.”
In her speech to Parliament, Plibersek said the market was designed to reinforce rather than replace government efforts to restore nature.
The bill contains provisions allowing the Clean Energy Regulator to purchase nature repair certificates on behalf of the government, meaning it likely intends to participate in the market in some manner.
University of NSW senior lecturer Megan Evans was critical of the legislation more broadly, telling Carbon Pulse it would do little, if anything, to protect nature.
“The bill will incentivise projects that effectively do nothing – the minister must only ‘have regard’ to biodiversity integrity standards before making a method, and the Clean Energy Regulator … must only be ‘satisfied’ that a biodiversity outcome will likely be delivered before a certificate is issued to a project,” she said.
In her submission to the government’s consultation, Evans said the bill provided “ample scope” for the same additionality issues that have plagued carbon markets to emerge in the nature repair market.
“There is so much interpretive leeway and ambiguity in this wording that it is highly likely to enable non-plausible estimates of averted/avoided loss, and overstated claims of biodiversity outcomes that are therefore non-additional,” she wrote.
Evans has also argued the scheme would perversely incentivise offsetting, given that the government has no control over how a certificate could be used once it is purchased, meaning a buyer could potentially buy a certificate restoring one piece of land, and use it to justify clearing another.
The legislation is currently before the House of Representatives, and the earliest it is likely to be voted on is in the next parliamentary sitting in May.
Plibersek has indicated she hoped the scheme could be operating as soon as next year.
By Mark Tilly – email@example.com
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