Solid Energy New Zealand and the Business Biodiversity Offsets Program

The following summary of the presentation given by Mark Pizey of Solid Energy New Zealand for the EIANZ Conference on 31 October 2008 was produced by Gabrielle Roy. Download the presentation powerpoint as a PDF (1.9MB).

Revegetation, as at the Greystone coal mine in South Island, New Zealand, is one of many options available to offset biodiversity effects from industry. Solid Energy New Zealand are working with the Business Biodiversity Offsets Program to look at ways of measuring biodiversity outcomes, with the aim of achieving overall no net-loss.

Through partnership between companies, governments and conservation experts, Business and Biodiversity Offset Program (BBOP) offers an opportunity to identity methods of offsetting damages to biodiversity, defined as species composition, habitat structure and ecosystem services, caused by development. This is achieved through voluntary projects which trial methods of biodiversity offsetting. One such project is offsetting the impacts of coal mining at Greymouth Coalfields, New Zealand, managed by Solid Energy New Zealand.

Solid Energy New Zealand is a state owned energy company which is a leading producer of high quality coal at a national and international scale. The aim of their environmental policy is for their activities to result in a net positive impact on New Zealand's environment by undertaking “non-mining projects that have significant net positive benefits for the New Zealand environment.”

Greymouth Coalfields are situated on the west coast of South Island, approximately 11 km north-east of Greymouth. The mining complex comprises a number of mines, including Strongman mine, the location of the BBOP pilot project. Mining activities, occurring between 1939 and 2005, resulted in significant habitat degradation, which was further exacerbated by underground fires. In 2004, the site was managed to commence rehabilitation with the aim of achieving the objectives set out by Solid Energy's environmental policy. Biodiversity offsetting is not a substitution for mitigation measures. Instead, the aim is to implement it at the end of the mitigation hierarchy, as demonstrated below (Hollands and Bishop,

  • Avoid
  • Reduce, moderate, minimize
  • Rescue (relacation, translocation),
  • Repair, reinstate, restore
  • Compensate / offset

Offsetting strategies include:
  • Averting loss by protecting biodiversity which is not legally protected
  • Pest / predator control methods to minimise threats to indigenous biodiversity
  • Trading up schemes which use credits to protect threatened biodiversity
  • Biobanking which allow for investment into a market-driven scheme for biodiversity

Through a process of consultation, which included modeling the outcomes using these different techniques and consulting stakeholders, it was decided that the most efficient method of achieving Solid Energy's environmental aims was by averting biodiversity loss through increased protection. Prior to implementing the scheme baseline data was collected through ecological surveys, obtaining historical data, identifying key biodiversity markers and developing a monitoring program to measure the efficiency of the scheme and adapt the management prescriptions where needed. This preparatory process also allowed for the selection of the Strongman mine as a suitable location to launch the scheme.

Strongman mine site supports approximately 5000 ha of continuous unprotected native vegetation, within a landscape of fragmented and relatively small patches of protected and unprotected native vegetation. Over time, it is assumed that unprotected biodiversity is lost at a given rate and impacts, such as mining, result in an increase loss. In this case, the loss is defined as the difference between the original rate and that caused by the impact. Where additional protection is provided for biodiversity, the loss rate after impact and offset is minimised, thereby resulting in biodiversity gains. The Net Present Value (NVP) is therefore calculated for the impact and combination by taking into account future gains and losses, discounted by time and risk.

Therefore, NVP is calculated as:

Impact x discount rate / Loss rate

For the Strongman mine project, averting biodiversity loss was calculated as below and resulted in the protection of 2685 ha of native habitat within an offset reserve. The Business Biodiversity Offset Program is an opportunity for businesses to voluntarily offset their impact on biodiversity through the implementation of tried and tested schemes. The example of the Strongman mine has demonstrated that protecting biodiversity not legally protected is an efficient method of achieving a net positive environmental impact through development.

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