Posted on September 29, 2013 by Frances Tse

Can we bank on the future of biobanking?

The biobanking scheme in NSW commenced in July 2008. Since then, only 21 biobanking agreements have been entered into to create biobank sites and only 7 biobanking statements have been issued. A review of the scheme is currently being undertaken by the NSW Office of Environment and Heritage. Public submissions were invited from 10 May 2012 to 9 July 2012. The Office of Environment and Heritage’s (OEH) website states that the submissions are now being considered.

A discussion paper published by the OEH to encourage submissions during the submission period noted that the uptake of biobanking had been slow due to a variety of factors including the voluntary nature of the scheme, cost of assessment for biobank sites and misconceptions about the scheme.

The biobanking scheme is a market-based scheme for the creation, trading and retiring of biodiversity credits. The scheme is set out in Part 7A of the Threatened Species Conservation Act 1995, the Threatened Species (Biodiversity Banking) Regulation 2008 (Biobanking Regulation) and one of the key documents underpinning the scheme is the Biobanking Assessment Methodology.

The key aspects of the scheme are:

  • establishing biobank sites on land through biobanking agreements between the Minister for the Environment and landowners
  • creating biodiversity credits for management actions that are carried out, or proposed to be carried out that improve biodiversity values
  • trading of credits once they are created and registered
  • enabling the credits to be used to offset the impact of development on biodiversity values.

Biobanking Assessment Methodology

The biobanking assessment methodology is important to the scheme because it is the tool used to determine:

  • the impact or likely impact of management actions on biodiversity values, for example whether management actions improve biodiversity values
  • the number of biodiversity credits that  may be created for those management actions
  • the number and class of credits that must be retired to offset the impact of development.

Biobanking Agreements

A biobanking agreement is entered into between the Minister for Environment and a landowner to designate and establish a biobank site.

A biobanking agreement may contain a number of terms including requiring the owner to carry out particular management actions on the land, restricting the use of the biobank site and providing for the timing and creation of biodiversity credits.

Not all land may be the subject of and not all landowners may enter into a biobanking agreement. The Biobanking Regulation sets out particular criteria for land that cannot be designated as a biobank site. The Minister must also consider whether a person is a fit and proper person to enter into and fulfil the obligations imposed by a biobank agreement before entering into one.

Biobanking Statements

Developers can choose whether or not to enter into the biobanking scheme. If a developer enters into the scheme and obtains a biobanking statement, the development to which the biobanking statement applies is taken to be development that is not likely to significantly affect any threatened species, population or ecological community or their habitat.

As such, a biobanking statement is an alternative to assessing whether a development is likely to significantly affect any threatened species etc. under the Environmental Planning and Assessment Act 1979.

A developer obtains a biobanking statement by applying to the Director General of the Department of Environment, Climate Change and Water. A biobanking statement may be issued if the Director General determines on the basis of an assessment of the development in accordance with the biobanking assessment methodology (including the number and class of biodiversity credits to be retired as an offset against the negative impact of the development on biodiversity values), that the development will improve or maintain biodiversity values.

If a biobanking statement is supplied to a consent authority, the consent authority must impose a condition of consent requiring the biobanking statement to be complied with. For example, if a biobanking statement provides that a certain number and class of biodiversity credits must be retired prior to the development commencing, then that becomes a condition of consent.

Creation, trading and retiring of biodiversity credits

Biodiversity credits are created, traded and retired only by registration on a public register maintained by the Director General.

The sale of biodiversity credits funds the ongoing management of biobank sites and the price of a credit is determined by market conditions.


It appears from the biobank site expressions of interest register (a register of landowners who are interested in establishing biobank sites but have not entered into a biobanking agreement) that there is a supply of potential biobank sites and therefore biodiversity credits that could become available. However, from the limited number of biobanking statements that have been issued since the commencement of the scheme, it is clear that its uptake, at least by developers, has been slow.

The future of biobanking will depend on the review of the scheme by the OEH. It will be interesting to see what the results of OEH’s review of the submissions will be and what, if any, changes will be made.