Habitat banking at a standstill: The case of Spain

Abstract Habitat banking has gained traction in recent years as a means to compensate for the unavoidable environmental impacts of development projects through the exchange of so-called biodiversity offsets. Analyses of the ideological foundations and operational challenges of habitat banking exist, but there has been far less scholarship on the policy processes leading to the establishment of such schemes. Habitat banking is a controversial policy instrument, which has encountered opponents and proponents in most places where it has been implemented. Drawing on semi-structured interviews and participant observation conducted from 2014 to 2018, we analyse the development of habitat banking policy in Spain. We show who was included or excluded from the policy making process, and we highlight the arguments put forward by different actors to contest or support habitat banking more generally. We show that the process was opaque and non-inclusive, driven by a small constituency of actors who sought to create investment opportunities for biodiversity conservation on private lands, and was grounded on a false social consensus which concealed alternative understandings of how environmental impacts should be addressed. We also demonstrate that the current delay in producing the guidelines can be explained by three circumstances. First, habitat banking was challenged by many civil society groups on the grounds of its market-based character. Second, necessary data was not available or accurate enough to devise effective habitat banks, with ecological metrics involved in quantifying offsets seen as too subjective. And third, key implementation actors lacked capacity and political will. The Spanish standstill highlights the struggles and difficulties that even well-resourced states can face when establishing rules for habitat banking and the trade in biodiversity offsets.