In their joint announcement, Prime Minister Anthony Albanese and Environment Minister Tanya Plibersek said the new trading scheme would recognise landholders who restore or manage habitat and grant them biodiversity certificates, which can be bought and sold on a market similar to the current carbon trading scheme.
The goals of the new biodiversity trading scheme announced to date are to 'protect waterways, provide habitat for native species, reduce erosion, protect topsoil, improve drought resilience and create shelter for livestock'. The announcement also stated the new biodiversity market will 'promote management of existing, remnant vegetation that provides habitat for native species'.
Mr Albanese stated the new trading scheme 'will be open to all land managers – whether they're farmers, people interested in conservation and Indigenous land managers'. Under the trading scheme, land managers will receive biodiversity certificates (i.e. credits) for restoration or management of local habitat. In this way, land managers could be recognised for past as well as future action to restore and manage biodiversity on their land.
Issued certificates will then be traded on a market similar to the carbon market and will 'make it easier for businesses, organisations and individuals to invest in landscape restoration and management'. Potential traders in the biodiversity market are similar to the carbon market, for example, energy and resources companies and land developers who have the obligation to offset the environmental impacts of their projects.
The new biodiversity trading scheme will be administered by the Clean Energy Regulator after a period of consultation regarding the detailed rules of the scheme.
The new scheme has the potential to provide land managers with an alternative income stream as well as recognise their efforts to protect and increase biodiversity on their land.
We recommend land managers take stock of existing, remnant vegetation on their land to ensure they are prepared to take advantage of the new biodiversity trading scheme when it commences.
Cooper Grace Ward is a leading Australian law firm based in Brisbane.
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