Biodiversity Conservation Amendment (Biodiversity Offsets Scheme) Act 2024 (NSW)

Links to the Parliament website for the BOS Amendments and the Explanatory Memorandum.

Overview

The Biodiversity Offsets Scheme in Part 6 of the Biodiversity Conservation Act 2016 (NSW) (BC Act) regulates offsets allowing credits to be traded and retired, and is intended to offset the residual impact on biodiversity values after action is taken to avoid or minimise impacts of clearing and/or development. It has been amended to permit a transition away from a no net loss outcome and towards a net positive biodiversity outcome. It also takes steps to strengthen the BC Act provisions by defining what it means to avoid minimise and offset impacts (amongst other changes).

Background

The BOS Amendments follow the Henry Review, published in 2023, an independent legislative review of the BC Act’s first 5-year period of operation. In April 2024, the NSW Government released the NSW plan for nature in response to the Henry review, which noted that almost half the recommendation of the Henry review relate to the Biodiversity Offsets Scheme. It set out the State Government’s response.

The BOS Amendment is only a small legislative piece in the scheme of the recommendations of the Henry Review and the Government response. However, the changes are significant.

BOS Amendments

Net positive, strengthening the avoid minimise and offset hierarchy

Transitioning to a net positive biodiversity outcome

1. Section 6.2A of the BC Act now requires the Minister to make a strategy for the transition of the biodiversity offsets scheme to deliver “net positive biodiversity outcomes”.  Public consultation is mandatory, and the Minister must make the strategy as soon as practicable after the commencement of that section. 
2. Section 6.7(3) of the BC Act now requires the Minister when establishing the biodiversity assessment method to have regard to the strategy for the transition to deliver net positive biodiversity outcomes under s 6.2A(3) and during the transition adopt a standard that will result in no net loss of biodiversity in NSW.

Strengthening the hierarchy of avoid, then minimise and then offset impacts

3. Section 6.3A of the BC Act now defines the hierarchy of ‘avoid, minimise and offset’ which requires proponents to avoid and minimise impacts before using the biodiversity offsets scheme. See also s.1.3(k) (purpose) of the BC Act which added the words “reflecting the avoid, minimise and offset hierarchy,” and s 6.4(1) where the following words are omitted “steps taken to avoid or minimise those impacts” and replaced with “measures taken to avoid or minimise those impacts under the avoid, minimise and offset hierarchy”. Regulations setting out assessment standards for ‘genuine measures’ to avoid and minimise are not included in this suite of changes.

Minister’s concurrence required for SSD and SSI conditions differing from s 7.14(3)

4. Section 7.14(3)-(3H) replaces the former s.7.14(3), noting that s 7.14(3A) of the BC Act now requires the Minister to concur with the imposition of a condition in State significant development and State significant infrastructure where such a condition is other than to retire the number and class of biodiversity credits that would otherwise be required under s 7.14(3).  The Minister has 14 days to consider whether to concur. The new powers require the Minister to consider facilitation of ecologically sustainable development when deciding, and permit the Minister to impose conditions on the concurrence which (if imposed) must be included as conditions of consent or approval (ss 7.14(3E) and (3F)).
5. The context for this new concurrence provision is that s 7.16 permits SSD and SSI consent under the Environmental Planning and Assessment Act 1979 (NSW), Part 4 – even if the proposed development is likely to have serious and irreversible impacts on biodiversity values – provided there is consideration given to whether there are any additional measures to minimise those impacts. (See, also, the provision for new registers to be maintained to record decisions where such considerations were required by s 7.16, below).

Change to the way the Fund works

6. Section 6.31 of the BC Act now requires the Biodiversity Conservation Trust (Trust) to apply money in the Biodiversity Conservation Fund (BCF) to retire a like-for-like biodiversity credit or another type of biodiversity credit provided for in the variation rules or apply an equivalent amount of money to secure other appropriate biodiversity offsets (at ss 6.31(2)). Further, it requires the Trust to apply money in relation to a BCF offset biodiversity credit within 3 years after the offset amount of the credit was paid into the BCF (at ss 6.31(5)).
7. Section 6.30(2) of the BC Act has been replaced with a power to prescribe when a proponent cannot make a payment to the BCF to meet a credit obligation. However, the regulations to give effect to this are not yet made.
8. Section 6.29A is a new regulation-making power for biodiversity conservation measures that will satisfy the requirement to retire biodiversity credits. However, regulations under this new s.6.29A are not yet made.

Local development

9. Section 7.13(5A) of the BC Act now permits concept development and staged development consents to provide for staged retirement of biodiversity credits before each stage of development.
10. Section 7.7(3) and (4) of the BC Act now empower the Minister to make an exemption order for an application for consent from a requirement for a biodiversity development assessment report in certain circumstances, for example per s (3)(a) in connection with a natural disaster.

Additional public registers

11. Section 9.7(e1)-(e4) of the BC Act now provides for additional public registers for exemption orders made under s.7.7(3), decisions to grant consent or approval where consideration was given under s 7.16(2) to (4) or decisions to refuse on grounds of serious and irreversible impacts on biodiversity values.

There are also many small changes to improve the administration of this framework that we do not include here.  The BOS Amendments came into force on 7 March 2025.

If you would like advice or assistance in relation to the BOS Amendments, please contact us.