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Habitat Banks

Habitat Bank - Meta

What are habitat banks?

The Habitat Banks are lands where compensation requirements and actions for the preservation, improvement or restoration of ecosystems are implemented to offset negative impacts on biodiversity. Through the Habitat Banks, quantifiable gains in biodiversity are generated, which are used for companies to offset for the environmental damage caused. This mechanism is oriented to generate a payment for environmental results, which makes it possible to achieve increases in productivity, efficiency, and quality of environmental compensations. In order to ensure the success of Habitat Banks, they  receive financial, technical and legal guarantees,  that are aspects little  considered in environmental investment mechanisms.


Therefore, Habitat Banks are intended to serve as aggregate offsetting schemes, where several companies may offset their damages to the environment in a single area. In addition, these Banks become a cost-efficient solution, in which whoever generates the impacts only makes payments as different milestones are met in the process of design, and maintenance of biodiversity units, which have their equivalent in terms of hectares.

Habitat Bank - Meta

Habitat Banks in Colombia

Since 2013, Terrasos  with the NGO Fundepúblico, have worked on the issue of environmental offset for a simple reason, although these are an instrument of environmental management established since 1993, the country has no record of where or how they are being implemented. Under this scenario, these two organizations developed a proposal for the offset implementation through Habitat Banks. 

These banks are a mechanism incorporated in several countries that has been shown to make environmental offset processes more efficient,  as they facilitate their compliance and at the same time improve control and surveillance by environmental authorities. Habitat banks are also an opportunity for the country to generate environmental public policy instruments that can be translated into opportunities for rural development and  natural resources protection. 

Within this research, documents and materials were developed to motivate reflection on the way in which Colombia can move forward in an effective implementation of environmental offset. The following infographics were created from this work: View PDF

What is the solution we offer?

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Status quo
Habitat Banks
Habitat Bank

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Project 1

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•High transactions costs

•Unknown implementation costs

•Reduced impact

• Misalignment in timing between projects and duties

•Non permanence of investments and impacts

  • Early investment

  • Payments according to results

  • Secured land

  • Reduced transactions costs

  • Economies of scale 

  • Reduce financial risk and customer uncertaint

Habitat Bank guarantees

Benefits of Habitat Banks

Regulations related to Habitat Banks in Colombia

Resolution 1051 of June 5, 2017

Recently, the Ministry of Environment and Sustainable Development (MADS) issued the administrative act that regulates Habitat Banks.  This act sets forth the scope of application , the conditions to create Habitat Banks and the terms that must be met in order to register them. The resolution assumes these banks as a mechanism for implementing the obligations derived from environmental compensation and the forced investment of 1%, and other conservation initiatives that can be configured through actions   of preservation, restoration, and sustainable use of ecosystems and their biodiversity, under the payment by results scheme. As part of the conditions for creating Habitat Banks, it is required to comply with the principles of additionality, complementarity, sustainability and permanence, payment by results  and knowledge management. (See Resolution here).

Decree 2099 of December 22, 2016

This Decree seeks a proper water management by requiring all projects that involve in their execution the use of water taken directly from natural sources, and that are subject to obtaining an environmental license, to allocate 1% of the total investment of these projects for the recovery, conservation, preservation and surveillance of the hydrographic basin that feeds the respective water source. As one of the mechanisms for the implementation of these investments, Habitat Banks are included, and others such as payment for environmental services, conservation agreements, as well as the application in conservation initiatives (Ver decree here).

Resolution 1517 of August 31, 2012

In 2012, the national government adopted, through Resolution 1517, the Manual for the allocation of compensation for biodiversity loss. This Manual applies to works and activities that require an environmental license from the ANLA, excluding projects licensed by CARs, subtractions of forest reserve areas, forest exploitation, among others. The guidelines of the Manual provide clarity and generate opportunities to seek more cost-efficient implementation schemes, which can result in quantifiable biodiversity gains such as Habitat Banks.(See Resolution here). 

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