The Biodiversity Credits Supply Fund (the Fund) is:
- buying credits upfront at competitive market prices based on forecast demand from major projects and infrastructure development
- selling credits at the purchase price plus a small mark-up (cost recovery) to public or private proponents who need to offset biodiversity impacts
- re-investing proceeds to buy more credits (as a revolving fund), enabling the initial investment to be used to buy and sell $200 million credits over 3 years.
The Fund also helps improve conservation outcomes with the government able to direct efforts to more strategic sites.
The Fund operates within the Department of Planning and Environment using existing provisions in the Biodiversity Conservation Act 2016.
Why is the Fund needed?
New South Wales has a $110 billion infrastructure pipeline and renewed investment in housing and manufacturing.
As a result, demand for certain credit types is increasing faster than supply, which can cause delays and increased project costs.
The NSW Government established the Fund to increase the supply of these credits and enhance confidence in the biodiversity credit market.
The Fund is delivering a significant increase in the supply of credits required for critical projects such as renewable energy zones, regional infrastructure initiatives and the expansion of housing and manufacturing.
This will reduce unnecessary project delays and costs without compromising environmental outcomes, resulting in greater economic benefits.
What does the Taskforce do?
The Credits Supply Taskforce is:
- fast-tracking supply of biodiversity credits by proactively supporting landholders to enter into biodiversity stewardship agreements (BSAs) that generate priority credits (credits most likely to be in demand)
- assessing and approving new biodiversity stewardship agreements (the Biodiversity Conservation Trust (BCT) continues to oversee the implementation of biodiversity stewardship agreements and annual payments to landholders)
- operating the Biodiversity Credits Supply Fund – acquiring priority biodiversity credits and on-selling them to proponents to support the delivery of infrastructure and other projects as those projects are approved, and seeking to:
- lower the cost of biodiversity credits compared to current forecasts, increase certainty and reduce delays for proponents
- reduce the need for proponents to pay into the Biodiversity Conservation Fund as a way to meet offset obligations
- improve liquidity and confidence in the biodiversity market and the Biodiversity Offsets Scheme.
- enhancing conservation benefits by contributing to regional and landscape-scale conservation objectives, integrating private and public land measures and contributing to a cohesive biodiversity strategy for the state.
Who is in the Taskforce?
The Taskforce includes staff with functions that closely relate to the objectives and activities of the Taskforce, drawn from:
- Biodiversity, Conservation and Science
- Biodiversity Conservation Trust.
The cross-agency representation will also help ensure the Fund operates as part of an integrated approach.