Coinciding with the United Nations International Day for Biological Diversity, environmental markets administrator Eco-Markets Australia has launched a new biodiversity credit market to reward landowners for restoring the country’s rainforest wetlands.
The Wet Tropics Rainforest Recovery Program is the first biodiversity market to be administered by Eco-Markets Australia, an independent administrator of environmental credit markets.
The program will issue Cassowary Credits, a biodiversity credit scheme developed by natural resource management nonprofit Terrain NRM (and named after the cassowary bird that’s one of the region’s most iconic inhabitants).
Credits are intended to support landholders that undertake “eligible restoration activities” to improve degraded habitats in the Wet Tropics region of Queensland in northeastern Australia.
The Wet Tropics of Queensland region is believed to be the oldest continuously surviving rainforest in the world, containing extraordinary biodiversity within its borders: half of Australia’s bird species, a third of its mammals and over 700 vertebrate species, according to a webinar hosted by Eco-Markets Australia this week.
It is also one of the only places in the world where two World Heritage areas exist side by side: the Wet Tropics Rainforest and the Great Barrier Reef.
Threats to the region come mostly from climate change-related events such as increased temperatures, altered water cycles, more frequent and intense cyclones, and invasive pests and species. In the past, there has also been clearing of forestland, some of which is still ongoing, as well as local extinctions of species. For example, three cassowary species are now extinct.
Cassowary Credits and the Rainforest Replanting methodology
Biodiversity markets exist in various forms, often as a co-benefit attached to a carbon credit.
“What’s different about this is it’s a standalone, purely biodiversity on its own credit that is entirely about the uplift in the condition of the rainforest habitat,” explains Maree Adshead, CEO of Eco-Markets Australia.
Similar to carbon credits and reef credits, biodiversity credits in the Cassowary scheme must be linked to measurable outcomes. Projects must be able to prove they did indeed restore rainforest biodiversity or mitigate a threat to that biodiversity, for example.
The Cassowary Credit Standard’s first approved methodology is the Rainforest Replanting Methodology, includes the design and implementation of new planting activities in the Wet Tropics Rainforest.
The methodology aims “to increase the current extent of rainforest in the wet Tropics bio region through planting of stems or direct seeding on cleared or heavily modified land,” Eco-Markets program director Amy Bassett noted during this week’s webinar.
Eco-Markets will oversee project registration, monitoring, reporting, validation and the issuance of credits, which will be issued only after meeting stringent requirements, ensuring outcomes are real, measurable and achieved prior to any credit issuance, she added.
As to who will purchase these biodiversity credits, Adshead says there is interest from governments, corporates, and even banks, among other entities.
Credit stacking: ‘It will hopefully stimulate much more participation’
Eco-Markets also announced what it’s calling “a landmark development for environmental markets in Australia,” which is the ability to stack Cassowary credits with carbon credits issued by the Australian Carbon Credit Unit (ACCU), the country’s government-regulated carbon market.
This is the first time in Australia that a biodiversity credit can be stacked alongside a carbon credit program on the same parcel of land, says Adshead.
She adds that this could be attractive for a landholder “because they have separate projects, separate income streams, separate trigger points in terms of when credits are issued, which makes it really attractive from a business point of view and a commercial point of view.”
Credit stacking, of course, is not without controversy.
Critics in the past have argued that stacking credits could lead to double-counting the same benefits. In the context of stacking a Cassowary credit with an ACCU carbon credit, the concern would be whether additional biodiversity benefits were generated that would not have happened with the carbon project alone (a concept known as additionality).
Adshead have gone to great pains to address this concern and the overall integrity of the Cassowary Credit Scheme.
“We don’t want the fact of another project being registered on top of a parcel of land where there’s a carbon project devaluing the credit of either,” she says.
“That’s why we’ve worked carefully with the regulators, who have formally endorsed our market as suitable for being stacked on a carbon project.”
Speaking at the webinar, Amy added that “because the project is first registered under the ACCU scheme, this affects how additionality is demonstrated through the Cassowary scheme.”
To satisfy requirements, projects must deliver biodiversity benefits “above and beyond those expected from the ACCU project alone,” she adds. That could include planting a greater density or diversity of native species, for example.
“Outcomes from the ACCU project cannot be double counted in the Cassowary credit project, proponents must apply a counterfactual deduction as outlined in the rainforest replanting methodology to account for the biodiversity benefit already delivered through the ACCU project.”
The first registered project under the Cassowary Credits scheme is with the Cassowary Coast Regional Council, and will involve stacking of these credits.
For her part, Adshead expresses excitement over the possibilities with stacking.
“It will hopefully stimulate much more participation. We’ve got a big, huge scale problem globally to halt and reverse nature loss and start uplifting conditions. We need everybody on board, so the more we can do to participate the better. If the opportunity that stacking creates is what stimulates more demand, then we’ve done our bit.”
‘Active participation’ from indigenous stewards
A key part of any Cassowary credits project will be inclusion and participation of Australia’s traditional owners.
“It’s a really critical component to make sure that our regional communities are engaged in the scheme and can benefit from projects,” Terrain NRM project coordinator Bronwyn Robinson explained during the webinar.
To that end, projects are required to use “regional-approved operators” and “preferentially use rainforest Aboriginal suppliers.”
“This is the first time we’ve got much more active participation from indigenous stewards of the land,” noted Adshead. “They’re able to get involved as approved operators, and they’re on the ground, applying traditional knowledge and and expertise around how to optimize the chances of the seedlings.
“We know that’s one of the elements of the best practice framework for biodiversity credit markets, and we’re pleased to have incorporated it. Obviously, there’s more we could do and more we would love to do, so we’ll take these learnings and see how we can make that more fulsome.”
