Eco cosy system m Mar arkets ts Pr Prim imer er T.J Mascia - PowerPoint PPT Presentation

Eco cosy system m Mar arkets ts Pr Prim imer er T.J Mascia Troutman Sanders, LLP New York State Wetlands Forum, Inc. Annual Conference and Meeting April 29 – 30, 2014

Ecos osystem m Mar arkets: ts: Fundame dament ntal l Concep cepts ts • Impacts are Inevitable • Market-Based vs. Command-and-Control • Restoration vs. Restriction • Natural vs. Built Capital Before • Benefits/Advantages vs. Limitations After

Ecos osystem m Mar arkets: ts: Primer er Foca cal l Po Points nts • Driver(s) • Units • Participants • Practices/Process • Status/Trends

Eco cosy system m Mar arket t Exam amples ples Voluntary Greenhouse Gas (GHG) Offsets Wetlands and Stream Mitigation Banking Species Conservation Banking Water Quality Trading (WQT)

Volu olunt ntar ary y GHG Of Offse sets ts GHG

Mar arket t Ba Basi sics cs Driver(s): Pre-Compliance / Sustainability / Philanthropy Units: MtCO2e Buyers: Unregulated Corporations / NGOs / Universities / Individuals Sellers: Offset Project Developers / Retailers / Aggregators Others: Standards / Registries GHG

Pr Prac actice tices/Pr s/Process ocess Offset-Generating Practices: • GHG Sequestration • GHG Capture Offset Certification & Sale • Verification • Certification • Registration GHG

Stat atus/T us/Tre rends nds Source: Forest Trends Ecosystem Marketplace GHG

Wetla land nd & Strea eam m Mit itig igati ation on Ba Banking ing Mitig igat ation ion

Mar arket t Ba Basi sics cs Driver(s): CWA Section 404 / WRDA / 2008 Mitigation Rule Units: Acres of Wetlands + LF of Stream Buyers: Section 404 Permittees Sellers: Mitigation “Bankers” / ILF Sponsors Others: USACE / Interagency Review Team (IRT) Mitig igat ation ion

Pr Prac actice tices/Pr s/Process ocess Credit-Generating Practices: • Creation • Enhancement • Restoration • Preservation Banking Process: • Initial Regulatory (IRT) Review and Approval • Credit Release(s) • RIBITS • Bank Closure and Long-Term Management Mitig igat ation ion

Pr Prac actice tices/Pr s/Process ocess Mitig igat ation ion

Pr Prac actice tices/Pr s/Process ocess Mitig igat ation ion

Stat atus/T us/Tre rends: nds: Market t Growth wth & Succ cces ess s Source: Forest Trends Ecosystem Marketplace State of Biodiversity Markets 2011 Update • 900+ Approved Banks  960,000+ acres restored/protected (2010) • Average Bank Size = 174 acres (2008) • Average Credit Price = $74,535 (2008) • Estimated Annual Market Value = $1.3 - $2.2 billion/yr Mitig igat ation ion

Stat atus/T us/Tre rends: nds: Pe Permittin itting g Effici cienc ency y Source: Birnie, Katherine (Ecosystem Investment Partners),. May 9, 2013."State of the Market: National Market Analysis and Overv iew.” Presentation at2013Natonal Mitigation &Ecosystem Banking Conference. New Orleans, LA Mitig igat ation ion

Stat atus/T us/Tre rends: nds: Reg egion ional al Variabil ility ity Source: http://www.restorationsystems.com/wetland-mitigation-bank/ Mitig igat ation ion

Stat atus/T us/Tre rends: nds: New w York • 3 Approved Banks as of Jan. 2013 (RIBITS) • Future Market Potential ? “NYCEDC Releases Request for Expressions of Interest to Establish First Wetlands Bank in New York City” Press Release December 20, 2013 Mitig igat ation ion

Sp Spec ecie ies s Con onse servation ation Ba Banking ing Specie ecies

Mar arket t Ba Basi sics cs Driver(s): ESA Sections 7(a)(2) and 10(a) Units: Acres of Habitat / Population Buyers: ESA Permittees Sellers: Species Conservation “Bankers” ILF Sponsors Others: USFWS / State Resource Agencies Specie ecies

Stat atus/T us/Tre rends nds Source: Forest Trends Ecosystem Marketplace State of Biodiversity Markets 2011 Update Specie ecies

Stat atus/T us/Tre rends nds Species currently protected by US conservation banks: Black-capped vireo - TX Golden Cheeked Warbler - TX California Coastal Gnatcatcher - CA Gopher Tortoise - MS California Tiger Salamander - CA Oregon Chub - OR Carolina Heelsplitter – SC San Joaquin Kit Fox - CA Chinook Salmon – CA, WA Sand Skink - FL Conservancy Fairy Shrimp- CA Utah Prairie Dog - UT Florida Panther - FL Steelhead - CA Florida Scrub Jay - FL Cheat Mountain Salamander – WV Giant Garter Snake- CA Western Burrowing Owl - CA Giant Kangaroo Rat - CA Valley Elderberry Longhorn Beetle - CA Swainson’s Hawk - CA Delta Smelt - CA Specie ecies

Stat atus/T us/Tre rends: nds: NY Conse servatio tion n Banking ng • Current Efforts: Indiana Bat Indiana Bat habitat enhancement: cave gate installation at Nature Conservancy project in the Missouri Ozarks • Other Species Banking? Specie ecies

Wat ater er Qu Qual ality ity Trad ading ing WQT

Mar arket t Ov Over ervie view Driver(s): CWA Sections 402 and 303 / TMDLs EPA WQT Policy / State Laws & Regs Units: Lbs. N or P / Sediment / Thermal Buyers: NPDES Permittees Sellers: “Bankers” / Farmers / Point Sources Others: EPA / State Agencies WQT

Pr Prac actice tices/Pr s/Processe ocesses WQT

Stat atus/T us/Tre rends nds WQT

Ecos osystem m Mar arkets: ts: Criteria eria For Succ ccess ess • Driver(s): Strong enforceable “cap” • Units : Real / Verifiable / Appropriate Ratios • Participants : Role of Private Entrepreneurs • Practices/Process: Clarity / Consistency / Transparency • Status/Trends: Monitor and Adapt

Qu Ques estions? tions? T.J. Mascia Troutman Sanders, LLP TJ.Mascia@TroutmanSanders.com 804-697-1421