A French asset manager is considering generating voluntary biodiversity credits from a conservation project in Costa Rica, part of which is preparing to produce carbon credits, Carbon Pulse has learned.

Mirova is working with non-profit Wallacea Trust on potentially generating biodiversity certificates in the long term from a property that is dedicated to converting degraded pasture land to a combination of forest restoration and rotational grazing.

“We are working on a project to generate carbon credits, that’s the first goal of the investment, but longer term, the project could go through the route to generating biodiversity certificates,” Anne-Laurence Roucher, head of private equity and natural capital, told Carbon Pulse.

“We have assessed the biodiversity, but we have not yet started to enable the generation of biodiversity certificates,” said Roucher. Biodiversity credits or certificates indicate nature uplift from an area of land over a period following interventions.

The Costa Rica property spans 30,000 hectares in total, but Mirova does not yet know how much of the land might supply biodiversity credits.

Metrics including species abundance of reptiles, amphibians, and birds, alongside canopy change, could be used to generate biodiversity credits, she said. Wallacea Trust defines a credit as a 1% uplift, or avoided loss, in biodiversity per hectare using a ‘basket of metrics’.

The Costa Rica project has “clear biodiversity benefits” through creating riverside corridors that support biodiversity, she said.

Any biodiversity credits would be issued separately from carbon credits, while ensuring both types produce additional environmental benefits.

UK-headquartered non-profit Wallacea Trust has a methodology for measuring uplift in biodiversity credits that includes a peer review process to verify claims.

In May, sister project developer RePlanet announced that a blockchain marketplace for enabling sales of biodiversity credits was almost ready to begin selling.

“Wallacea Trust are experts. They are developing high-quality projects [in general], and I believe that they will find buyers,” said Roucher. In July, RePlanet said it hoped to sell biodiversity credits worth over $14 mln within months.

“WE NEED A BIODIVERSITY MARKET”

Mirova is not in a hurry with biodiversity credits as it wants to ensure they are credible before they become fully tradable, but Roucher is confident the market will become a reality due to the scale of the nature crisis.

“Six out of nine … planetary boundaries have been crossed. We know that we need to work on biodiversity. That’s why I’m sure this market will develop, because we need it,” she said.

Last year, research showed nine boundary processes that dictate a safe operational space for humanity, indicating the planet’s resilience, were being crossed.

With biodiversity credits, as with carbon, investors need to be active on the ground and at a higher level in the market, Roucher said.

“There needs to be structured demand. We need a clear, level playing field so that corporate investors can invest, and we are not there yet.”

Mirova is one of the more active financial institutions in biodiversity credits, with CEO Philippe Zaouati among the 21 members of a UK-France panel aiming to galvanise international markets around them.

In December, Mirova invested in Terrasos, an early mover in the biodiversity market that generates credits through a series of habitat banks.

The investor is also engaging with Australia’s coral reef credit scheme as operator of the L’Oreal Fund for Nature Regeneration.

By Thomas Cox – t.cox@carbon-pulse.com

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