BAM Changes - Landholder Implications
The NSW Government has released a draft set of changes to the Biodiversity Assessment Method, the method underneath the Biodiversity Offset Scheme that determines the credits a site will generate.
The key changes for landholders relate to how a stewardship site generates credits and what it will yield.
Overall, credit generation is being shifted away from conserving land in good condition, and toward actively restoring it, although the cost effectiveness of undertaking restoration against credit prices is yet to be tested.
Less credit for holding vegetation in good condition
Security benefit increases credit generation for holding high-condition vegetation at a stewardship site, without requiring any actual gain in biodiversity values. The department found almost a tenth of credits generated on stewardship sites came from security benefit alone.
The draft BAM change cut this yield back. Security benefit is now:
removed for vegetation zones with a vegetation integrity score between 60 and 70
halved for zones above 70
removed for species credits
If a site was attractive mainly because it was already in good shape, that is a direct cut to what the condition alone will generate.
The value now has to come from improving the site, not from holding it.
Restoration
The draft reworks how a stewardship site generates credit through restoration, and ties the yield to the quality of the plan.
Management actions have been recast into two kinds of gain:
regeneration gain, actions that remove the threats holding back natural recovery
ecological reconstruction gain, more intensive work where nature will not recover on its own
This replaces the old required checklist. The plan is now built around what your land actually needs, its condition, its threats, its potential.
That tailoring starts with a new step: before the management plan is designed, the assessor runs a restoration risk assessment to identify the threats and constraints limiting recovery, which the management actions are then designed to address.
The reward for doing this well has also changed.
Restoration always carries uncertainty about whether the predicted gain will be achieved, and the old method managed that with a flat 0.3 risk multiplier applied to every plan, good or bad.
Only about a third of sites took on restoration at all, because there was limited reward for doing it properly.
The draft replaces the flat multiplier with a framework: where your plan shows real ecological rationale, sensible sequencing and a high likelihood of reaching the target condition, the assessor can justify a lower risk weighting, and a lower weighting means more credits.
The weighting is settled with the Department and early decisions testing this approach will be crucial to understanding how it will shift the market.
The yield now follows the quality of the restoration.
For a landholder, the plan you commissioned determines what the site produces.
Correcting the score for derived grassland
Derived native grassland is grassland where the tree canopy has been cleared but the ground layer is still intact and often rich in species.
Under the old method these sites scored artificially low on vegetation integrity, because the score leans on attributes tied to a canopy that is no longer there, even where the ground layer is in good condition.
The draft corrects this with new minimum condition scores:
a minimum of 3 for function
a minimum of 1 for composition and structure
For a landholder in grassy woodland country, a site that looked marginal under the old scoring may now carry more credits than before.
The change lifts genuinely good derived grassland that was being undervalued, without lifting sites that really are in poor condition.
Streamlined additionality
Where a stewardship site already carries a conservation obligation, some of the gain it would otherwise generate is reduced, because the land was already being managed for conservation.
This reduction is called additionality.
Under the current method it works through a percentage-reduction model, scaling back the credits to reflect what would have happened anyway, and it requires significant consultation with the department to apply.
The draft replaces that model.
For a site with an existing conservation obligation, averted loss (the gain awarded for preventing ongoing decline) no longer generates any gain, and the time-based additionality rules are removed.
The upside is a cleaner, faster assessment with less back-and-forth with the department.
The downside, for a landholder with an existing conservation agreement in place, is that averted loss is switched off entirely rather than partly discounted.
With averted loss removed, the credits on a site that already carries an obligation have to come from genuine improvement, regeneration and reconstruction, rather than from protecting values that were already secured.
When it takes effect
Once the updated method is published, a twelve-month transition applies:
a report can be certified under either BAM 2020, or
the updated method, and a BAM 2020 report can be amended under the old rules for up to two years.
Timeline
Have your say. The draft updated BAM and consultation paper are open for submissions until 11:59pm on 10 October 2026.
