A Loss-Gain Calculator for Biodiversity Offsets and the Circumstances in Which No Net Loss Is Feasible

Abstract

Offsetting is a policy instrument intended to provide flexibility for development. We developed a simple calculator to predict when no net loss is feasible using biodiversity offsetting. Assuming offset ratios ≤10:1 are indicative of operational feasibility and employing a discount rate of 3%, we predicted that no net loss is feasible where biodiversity can be restored within 55 years, which restricts the impacts on biodiversity that can be offset using restoration. Alternatively, no net loss is feasible by avoiding loss to biodiversity that is declining under the counterfactual at an annual rate ≥6%. However, this is considerably higher than typical background rates of biodiversity loss so restricts where avoided-loss offsets are feasible. No net loss is theoretically feasible in the broadest range of circumstances if biodiversity gains are provided in advance of development. However, these gains are procured by restoration or avoided loss, so constraints presented by these approaches also apply. We concluded that no net loss is feasible in a limited range of development scenarios unless offset ratios greater than 10:1 are more widely tolerated.