Ecological engineering

Taking nature into account is a long journey, of which ecological compensation is one step. Its principle is to compensate for the ecological damage linked to a development project in a place by the reconstitution of ecosystems of the same ecological value.

The principle of compensation

Compensation originated in welfare theory. It responded to the problem posed by the Pareto optimum, a situation in which one can no longer increase the well-being of one person without decreasing that of another. Two economists, Kaldo and Hicks, proposed a principle of compensation. According to them, a project is “socially desirable from the moment when the utility gains generated for the beneficiaries of the project are greater than the losses suffered by a minority”. The beneficiaries will financially compensate the harm.

Ecological compensation concerns nature and is not monetary. It is about compensating nature with nature. Its beginnings date back to the National Environmental Policy of 1969, which codified impact studies in the United States. It was taken up again at the international level in 1971, within the framework of the Ramsar Convention on wetlands. In practice, monetary compensation always prevailed, which gave rise to endless controversies: how much is a toad worth? “Reason may cry out, but it cannot put a price on things” (Pascal).

The method was commonly used DUDEsurvey on willingness to pay. The Exxon Valdez oil spill in 1989 was a turning point. The scale of the disaster and the interminable nature of the assessment led to a search for ecological equivalence, “to move from a system of reparation that aimed to maintain human well-being to a system of reparation that aimed to maintain certain components of nature for their own sake” (p. 44).

In France, ecological compensation is mentioned in the 1976 law on the protection of nature – without any binding nature. The situation changed with the European directive on environmental liability of 2004, which was retranscribed in 2008. In 2016, the law on the reconquest of biodiversity made ecological compensation mandatory.

86% of the natural ecosystem

The instruction of the files is based on the doctrine ERC“avoid, reduce, compensate”. Any project must begin by seeking to avoid destruction: do we really need a new airport? Then, we must consider reducing impacts, with compensation only being used as a last resort. It must respect a principle of additionality: generating an ecological gain that would not have appeared without the compensation action.

How to assess the ecological values ​​destroyed and compensated? The first assessment tool dates back to 1983; it is the habitat equivalence protocol (HEP). This was just the beginning. In 2004, for wetlands alone, there were forty-one methods in the United States! The Habitat Equivalency Analysis (HEA) evaluates ecological functions by reducing them to units of discounted service per unit of surface area and per year (DSAYs, Discounted-Service-Acre-Years).

But the naturalist measure created as many difficulties as the economists’ measure. During the Chalk Point oil spill, the costs related to the assessment amounted to 1 million dollars for a compensation cost of 2.7 million! In France, if the national method for assessing the functions of wetlands has been imposed, for other environments there is a proliferation of tools, undoubtedly inevitable, but which constitutes a source of confusion and complicates comparisons. As the achievements are made, feedback makes it possible to identify what is feasible, but we never manage to reconstruct an ecosystem identically.

Compensation involves two places: the place of destruction and the place of compensation. In addition, there are four types of compensation: preservation (formation of preserved natural areas), improvement (remuneration of managers to change their practices, i.e. farmers and foresters), restoration (the destroyed ecosystem is restored elsewhere) and rehabilitation (a replacement ecosystem with the same ecological functionalities is set up). In restoration, it is a question of starting from a degraded ecosystem. At best, we can hope to reach an equivalent of 86% of the natural ecosystem. Compensation is therefore only valid if the area to be restored is below 75% of its potential.

Since biological phenomena are not linear in space or time, restoration often depends on the size of the sites. It is especially effective on large areas on the scale of a landscape or a watershed connected to other natural areas. This leads economic actors to support improvement. This solution also satisfies the State, which shirks its responsibilities and promotes the payment of “environmental services”. The problem is that these contracts are limited in time, while the environmental damage is irreversible.

Institutions and jobs

Internationally, the delegation to third parties by means of replacement remuneration, a sum paid to an association or agency with prerogatives related to the protection of nature, has prevailed. This made it possible to circumvent the question of evaluation. Did not ecological compensation converge with the strategic objectives of these organizations? In reality, an organization only functions as a rational agent within an institutional framework. In finecontrol by public authorities remains essential.

Over time, ecological compensation has generated a sector of activity estimated at 125,000 jobs in the United States (compared to 1,000 in France) and the development of a new engineering, “ecological engineering”. Agents of the instructing services can justify the strict application of the regulation by noting that it is a source of jobs and growth.

It was also able to rely on financial engineering: compensation banks. The first was created in 1986 in California. For its promoters, it involves investing in the restoration of a site, then reselling restoration units. In 2016, the United States had 1,300 for wetlands and waterways and 148 for endangered species, generating a turnover of 3.5 billion dollars.

To date, there are only four experimental sites in France. This system has the merit of being simple to control and restoration precedes destruction. To avoid the risk of securitization, the units can only be sold within the framework of an identified environmental impact authorization. This avoids the fungible nature of the units and paying for salamander biotope with red kite biotope…

Clearing banks ensure the application of the regulations which constitute their economic outlet, carry out permanent monitoring of development projects and now cause the most legal disputes in this area.

Getting out of monetarism?

Monetization that went out the door came back through the window. The value ranges from $75,000 per hectare of wet meadow in Minnesota to $2.3 million for wet forests in Florida. In France, the ecological compensation units of the Crau were sold for between 37,000 and 41,000 euros per hectare. Summary studies on the real costs of implementation arrive at average estimates of $600 per linear meter for watercourses in France and $320,000 per hectare of wetland in the United States.

These actions require control of land. In France, public land establishments, initially designed for development projects, can contribute to implementing ecological compensatory measures and farmers could organize themselves collectively within an agricultural land association. In Germany, States organize the spatial planning of compensations.

These processes contribute to a dismemberment of property rights,use, abuse, fruit of Roman law. Theuse is the restoration of natural entities, and theabuse (which goes beyond theuse) implies that their ecological value is maintained. The environmental real rights have been sold to a third party, who will maintain the obligations constituting ecological compensation. This is an ecological easement. In the sphere of common lawland ownership is considered as a bundle of rights that ecological easements complement.

These advances are weakened by a lack of political will, notably in France. No obligation to carry out an environmental impact study below 10,000 m² of land use, nor for parking areas, nor for clearings of less than 25 hectares. Since 2014, a system of criminal transaction has transformed the obligation of ecological compensation into a simple payment in discharge. France is the champion of pre-litigation for failure to apply Community law. Internationally, there is a lack of administrative staff to process files and the investigating services are subject to political and administrative pressure everywhere. The objectives of ecological neutrality are not being achieved, with the possible exception of wetlands in certain American states.

Ecological compensation seemed to outline the recognition of an intrinsic value to nature, but it did not call into question the mode of development, thus attracting strong criticism. Is it not similar to a new mechanism for putting nature into economics? The author hopes not, even if he admits: “It implies, in substance, a fungibility of nature and the possibility of its replacement with the equivalent.” The panorama he paints nevertheless leaves one perplexed, as evidenced by the aborted attempt to get out of monetarism. If money is never anything more than a social tool of mediation between men, why deprive oneself of it? Because nature does not accept dollars. “Is it not a pleasant wealth whose abundance does not prevent one from dying of hunger? It is like that Midas of mythology, whose greedy wish turned all the dishes on his table into gold” (Aristotle).

And the author concludes: “In summary, the clarity of the rules relating to ecological compensation and the capacity of the public force to enforce them represent the basis from which a certain coordination of representations and actions can emerge on this subject” (p. 109). Indeed. But where there is no will, there is no path.