Time to Recognize Biodiversity’s Role in Climate Change

In school we used to learn about biodiversity by creating animal habitats in shoeboxes, going on nature hikes, or hanging a bird feeder in the backyard. Very few of us went on to study nature in college. And, when it comes to climate change, biodiversity has received much less attention than carbon storage in our forests, wetlands, and agricultural land. Until now.

Biodiversity, no longer the silent stepsister, claims its importance in climate change efforts.

In previous articles about carbon credits in forestry, agriculture, and wetlands, we discussed how conserving, restoring, and regenerating these precious habitats is critical for sequestering carbon and how carbon credits can help finance conservation projects.

It’s easier to understand how carbon credits for forests can contribute to less greenhouse gas emissions than how biocredits can do the same. But investing in biodiversity can often contribute twice as much more carbon sequestration than forests.

Twice as much? What is biodiversity, biocredits, and what is its role in climate change?

Rich and at Risk

Biodiversity – plants, animals, bacteria, and fungi – on Earth is so rich that we cannot even account for all the different species. Scientists estimate that there are 8.7 million species of plants and animals on Earth. However, only about 1.2 million species are known. At the same time, many species are under threat of extinction.

Mother Nature has a hand in some habitat changes though most biodiversity loss is due to human behavior. Whether it is logging, farming, mining, consumption, overfishing, or invasive species, these activities destroy and degrade ecosystems and, in doing so, release more carbon dioxide into the atmosphere. Even wildfires not set by man can cause terrible biodiversity losses. The bushfires in Australia in 2019/2020 killed or displaced more than 3 billion animals. Koalas are now officially listed as an endangered species as a result.

If that wasn’t shocking enough, medical research indicates that biodiversity loss contributes to increases in zoonotic diseases. While 60% of infectious diseases are known to affect humans, 75% of emerging diseases are estimated to be zoonotic. Cases of Lyme disease, for example, in the U.S. Northeast have spiked as ticks have fewer mammals to prey on and are seeking out humans.

The Rise of Biocredits

In 2022 The United Nations’s included a Biodiversity Day shining a light on the global connection between climate change and biodiversity.

Like carbon credits, biocredits offer a tool to finance conservation restoration projects. With the backing of The United Nations and recognition from the World Wildlife Fund, biocredits are a credible way to succeed in carbon sequestering projects.

Most biocredits today are voluntary and don’t have the recognition and open market infrastructure that carbon credit markets enjoy. In other words, companies that want biodiversity credits have an investment interest in nature.

Establishing a marketplace for biocredits is an ongoing effort. Learning from the green carbon credit market (what works, avoiding misuse) is a start. The Biodiversity Credit Alliance (funded by the United Nations Environment Programme, the UN Development Programme, and the Swedish Development Agency) is an organization looking to develop biodiversity credits as an investment vehicle to fund projects. The Alliance’s 80-odd members include carbon credit companies, tree-planting companies, universities, laboratories, conservancies, consultancies, and other individual companies and organizations.

Investing in nature has business benefits too.

The Business Side of Biocredits

If you are a pharmaceutical company or in the business of producing food, you are dependent on nature. Nature plays a crucial role in countries or regions that rely on tourism or whose workforce is nature-related (think of agriculture harvesting) and often affects poor communities. In fact, in 2020 the World Economic Forum estimated that half of the world’s GDP moderately or heavily depended on nature.

In addition, there are roughly 36 biodiversity hotspots defined as areas where:

• Half a percent of its plant life or 1500 distinct species cannot be found anywhere else, and
• 70% of its vegetation has been lost

Biodiversity and Carbon

Exactly how does biodiversity affect the amount of carbon stored in nature ecosystems?

The circular nature of wildlife within an ecosystem tells the story. Scientists call it ‘animating the carbon cycle.’

For example, in forests with a healthy wildlife population, Yale researchers found that species such as large vertebrates by foraging, burrowing, and trampling the forest floor increase the ecosystem’s carbon storage capacity by as much as 250 percent. These vertebrates disperse seeds facilitating the growth of trees and eat vegetation giving trees the space and nutrients they need.

The same occurs in our oceans and other bodies of water. In deep waters, whales feed and release nutrients in their waste at shallower depths. This stimulates the production of phytoplankton, which is crucial for storing carbon in the ocean.

In Africa, researchers found that for every increase of 100,000 animals in the Serengeti, carbon sequestering is raised by 15 percent. In particular, wildebeest migrate almost 10,000 square miles of the Savanna. Along the way, they consume carbon in the grasses and excrete it in their dung. Insects then integrate dung into the soil.

Keeping global warming below 1.5 degrees Celsius above pre-industrial levels involves removing about 500 gigatons of atmospheric CO2 by 2100 (in addition to reducing fossil fuel emissions). Scientists argue that removing 500 gigatons can be done in 35 years instead of 77 years if we focus on rebuilding animal populations.

Examples of Biodiversity Credits in Practice

Several projects of note have been recognized by the World Economic Forum in the September 2022 briefing paper.

In 2022, New Zealand’s Sanctuary Mountain Maungatautari issued “sustainable development units” to a parent group representing several supply chain businesses. The program, which received additional funding from other investors, had a goal to keep invasive pests and weed numbers low through conservation management in 83 hectares.

Also in 2022, Colombia introduced biodiversity credits dedicated to the conservation of remaining native species in the High Andes. Biocredits, priced at $30, represented 30 years of conservation and/or restoration of 10 square meters of the Bosque de Niebia forest, The forest is home to several threatened species, including the spectacled bear, the yellow-eared parrot, and the black and chestnut eagle.

In Australia, a carbon project developer created an EcoAustraliaTM credit, which combines one carbon credit with a biodiversity credit representing 1.5 square meters of habitat protection. Credits have been issued for Mount Sandy, a rare intact native vegetation in the Coorong region. Notably, this project’s management is made possible through close collaboration with a nearby aboriginal community, local elders, and individuals who oversee the vegetation and conservation of the site.

Measuring Outcomes

Unlike its carbon credit counterpart, measuring positive, lasting impacts of biodiversity is not as easy as measuring CO2 levels. Over the years, several methods have been devised and debate continues on how to address it.

Counting the number of species

Calculating the abundance of species in an ecosystem has its drawbacks. For example, it doesn’t account for the correlation between plants and animals. An area may be rich in plants but not in other life forms such as animals and microorganisms. Nor does it account for the value of the ecosystem. Losing an animal species could have a devastating wildfire impact in a grassland area.

Shannon’s Diversity Index

This Index seeks to consider both the richness and evenness of a species. There are a couple of issues with this approach including that it ignores the hierarchical structure of an ecosystem by assuming an equal weight to all of its components.

H.T. Odum’s Emergy

Emergy is the total available energy, directly or indirectly, required to produce a product or service. Using this energy-based method, Odum argues that biodiversity would increase proportionally with the increase in renewable emery in an ecosystem. Yes, there are limitations with this method as well. Firstly, there is a lack of population data for many species. Secondly, there is a huge difference in the lifetimes of various species and the areas that support the species.

In the short term, there does not seem to be a universal way to measure positive outcomes and projects are moving ahead with specific goals aimed at either increasing species populations or conserving/restoring vegetation.

When it comes to measuring the positive impact of conserving/restoring vegetation, it is advantageous to have baseline metrics of the existing conditions. As a government, land owner, business, or financial institution interested in monetizing natural assets or investing in environmental projects, you must consider the accuracy and integrity of the data used to determine the value of biocredits or biodiversity offsets.

This is where Laconic’s work in decarbonization and habitat preservation shines. Until now, no system has been able to collect and continually monitor environmental data. Laconic’s integrated Environmental Intelligence service and SADAR™ platform, is the first comprehensive system that collects and analyzes data providing the critical insights needed for strategic decision-making in environmental projects.