Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Marianne Darbi, IÖR Dresden

PLPR Conference, 10-12 February 2010, Dortmund

Compensation agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restoration

1/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Outline

1. Background

2. Goal and Definition

3. Methodology

4. Why do compensation agencies emerge?

5. Core parameters of compensations agencies

6. Suggestion to cluster types

7. Advantages and potentials

8. Obstacles and criticism

9. Conclusion

10. The way ahead

2/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

BackgroundImpact Mitigation Regulation (“Eingriffsregelung”) is the major landscape

conservation instrument to address mitigation and compensation for impacts

from developments and projects in Germany:

entered into force as part of the Federal Nature Conservation Act 1976

comprehensive approach (for all impacts, on all scales, not restricted to specific

areas)

deficiencies in the proper implementation of compensation measures

2002 and 2009 amendments to the Federal Nature Conservation Act

loosening of the spatial and functional connection between impact and compensation

compensation pools: provision and bundling of compensation sites and measures

Planning yes, implementation maybe, control no?*

3/18

* ANL – Bayerische Akademie für Naturschutz und Landschaftspflege (ed.) (1999): Ausgleich und Ersatz. Planung ja, Umsetzung vielleicht, Kontrolle nein? Laufener Seminarbeiträge 1/99.

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Compensation agencies (‘Flächenagenturen’)

“Compensation agencies are new service providers in the field of nature conservation, which

establish compensation pools and procure sites and measures for developers“ (BFAD e. V. 2008).

Compensation agencies are experts on compensation pools – including planning,

implementation and long-term management. They provide services and support to investors,

authorities and all local partners“ (BFAD e. V. 2008).

Goal and definition

Goal: Survey on procedural and financial aspects of compensation agencies in Germany*

How are compensation agenciesHow are compensation agencies established / implemented in practice?

Which barriers and difficulties does the creation of compensation agencies face?

Which potentials do compensation agencies have?

4/18

* Financed by KfW Banking Group

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Methodology

blabla Empirical study:

25 compensation agencies throughout Germany (almost all federal states, the

so-called ‘Länder’ are covered)

Examined compensation agencies are not evenly spread (differences in

compensation demand due to e.g. population density and economic growth)

Questionnaire and telephone expert interviews

5/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Why do compensation agencies emerge?

* multiple mentions possible

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

other subsequent causes

other initial causes

overcoming investment barriers / promotion of economicdevelopment

implementation of a landscape development project

foreseeable predictable compensation requirements of amajor development project

more efficient implementation of compensation measures

shortage in providing appropriate compensation sites *

6/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Core parameters of compensation agencies

blabla What are the core parameters that influence the functioning and financing of

compensation agencies?

1. form of organisation / legal form

number of employees

focus solely on compensation vs. compensation as one of a multitude of

fields of action

more nature conservation orientation vs. more economic orientation

2. area of influence and clients

3. availability and safeguarding of compensation sites

4. financing and cost recovery

7/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

1. Form of organisation / legal form

legal form number of employees

* non-profit organisations for rural development at the level of the 'Länder', under form of a limited liability company (ltd.)

less than 1

1

2 to 4

flexible employ-ment of

staff

n/a

gemeinnützige Landgesellschaften

GmbH (ltd.)*16%

other GmbH (ltd.)

20%

gGmbH (non-profit ltd.)

4%nature conservation foundations

12%

associations4%

municipalities8%

districts / counties

12%

others20%

n/a4%

8/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

great differences of scale and location

interrelation between area of influence and

possible clients (small area acting locally)

0 2 4 6 8 10 12 14 16 18 20 22 24 26

municipalities

districts / counties

public planning agencies (e.g. road planning)

private developers

own needs

n/a8%

nation-wide4%

Länder28%

morethan 4

municipali-ties/districts

12%

2-4 municipalities

/ districts24%

district / county16%

munici-pality8%

2. Area of influence and clients

*

* multiple mentions possible

9/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

stock-sourcing

/ on demand

on demand

stock-sourcing

n/a

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

purchase of sites in favour of a natureconservation foundation

physical securities

license agreements with land owners

planning specification

own land and purchase of sites

3. Availability and safeguarding of compensation sites

*

* multiple mentions possible

different states of the examined compensation

agencies regarding stocksourcing of compen-

sation sites and measures vs. on demand

mostly sites in stock but implementation on

demand of compensation measures (high costs)

10/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

4. Financing and cost recovery

Differences in the overall business

orientation (profit, cost recovery, no cost

recovery expected)

What costs occur and what are financial

means used for?

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

n/a

subsidies

credits

own capital *

* multiple mentions possible

n/a

no

yes

Are there any barriers for cost

recovery?

11/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

blabla The heterogeneity of the examined compensation

agencies reflects the current situation.

There is not one new homogeneous compensation

services provider but a multitude of different types.

12/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Suggestion to cluster types

Type 1: “Compensation agencies”

Type 2: Landgesellschaften*

Type 3: Nature conservation foundations and associations

Type 4: Municipal and district administration

Type 5a: Public utilities

5b: Property managers

* non-profit organisations for rural development at the level of the 'Länder', under form of a limited liability company (ltd.)

13/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Advantages and potentials

blabla steered development / inclusion into an overall concept is beneficial both economically and

ecologically (simpler and speed up lincensing procedure, creation of ecological networks,

measures are implemented where it is most useful from a nature conservation point of

view)

can lead to a reduction of land consumption

bundling increases the efficiency of the implementation and maintenance of measures

recovery of complex ecosystems and possibility to implement also cost-intensive measures

diminution of time lag effects

bundling of capacity and technical know-how

broad participation and acceptance (reduction of land use conflicts etc.)

14/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Obstacles and criticism

blabla risk that the appropriateness to compensate may not always be considered

advance financing

uncertainty (refinancing of sites and measures cannot be guaranteed)

need for trained personnel

preference for low cost measures

price dumping can have a negative effect on the quality of the measures

to date: lacking transparency and transferability (valuation techniques to

balance impact and compensation and cost calculation differ very much)

15/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Conclusion

IMR according to law remains the overall framework and defines the basic

principles requires on-the-ground measures (mere preservation,

environmental education etc. is not sufficient)

Compensation agencies can improve the implementation both quantitatively

(overcoming lack in enforcement) and qualitatively (common quality

standards)

Market dynamics: further development? (no unification expected)

16/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

The way ahead – what needs to be done?

http://www.verband-flaechenagenturen.de/index.html

In particular:

• identify and address the potentials and deficits of

the different types of compensation agencies

In general:

• work on common quality standards (nature

conservation point of view)

• Work on transparent full costing (economic /

business-management point of view)

17/18

Compensation Agencies in Germany – a tool to facilitate development and to safeguard environmental protection and restorationIÖR Dresden, Marianne Darbi, PLPR Conference, 10-12 February, Dortmund

Thank you for your attention!

Leibniz Institute of ecological and regional development Marianne Darbi

Weberplatz 1 Fon: 0351 463 42356

01217 Dresden Fax : 0351 4679 212

www.ioer.de E-Mail: M.Darbi@ioer.de

18/18