NSW Public Consultation Closes on Major Reforms to Transition Biodiversity Offsets Scheme to ‘Net Positive’ Outcomes

Overview of the 2026 NSW Biodiversity Offsets Scheme Reforms

On 17 July 2026, the NSW Government closed the public consultation period for the draft Biodiversity Conservation Amendment (Biodiversity Offsets Scheme) Regulation 2026. This draft regulation is the principal subordinate legislation instrument implementing the reforms enacted under the Biodiversity Conservation Amendment (Biodiversity Offsets Scheme) Act 2024, amending the Biodiversity Conservation Regulation 2017. Its significance cannot be overstated: it represents the most substantial structural overhaul of the NSW Biodiversity Offsets Scheme (BOS) since the scheme was established under the Biodiversity Conservation Act 2016.

The central policy shift is a move away from the longstanding “no net loss” objective toward a “net positive biodiversity outcomes” framework, consistent with the broader ambitions of the NSW Plan for Nature. For environmental consultants, BAM-accredited assessors, developers, rural landholders, planning lawyers, and local councils, this transition changes the fundamental calculus of biodiversity assessment, offset procurement, and project approval risk. The draft regulation touches every stage of the development pipeline, from early feasibility and ecological impact assessment through to offset market procurement, stewardship site administration, and post-approval compliance.

The closure of the consultation period signals that the regulation is moving toward finalisation. Practitioners and project proponents who are not yet across the detail of these changes risk being caught unprepared as the new framework takes effect. The changes are not marginal adjustments to existing practice. They require substantive revisions to how Biodiversity Development Assessment Reports are prepared, how offset procurement strategies are designed, and how major project timelines are managed.

Key details of the draft NSW Biodiversity Offsets Scheme Regulation 2026

The most commercially significant change in the draft regulation is the restriction on payments into the Biodiversity Conservation Fund (BCF). Under the existing framework, proponents with large offset obligations have been able to discharge those obligations by paying directly into the BCF, effectively transferring procurement responsibility to the government. The draft regulation introduces a hard threshold: proponents with obligations of 100 or more credits of the same type must demonstrate that they have taken active, documented steps to source those credits from the open market before they are permitted to transfer their liability to the BCF. This is not a soft preference for market procurement. It is a regulatory precondition to BCF access at this scale of obligation.

The draft regulation also substantially raises the standard of proof required for the “avoid and minimise” component of a Biodiversity Development Assessment Report (BDAR) prepared under the Biodiversity Assessment Method (BAM) 2020. BAM-accredited assessors will be required to provide rigorous, evidence-based demonstration that alternative project footprints, configurations, and construction methodologies were genuinely and exhaustively evaluated before an offset obligation was quantified. This is a departure from the common practice of including a relatively brief avoid-and-minimise narrative in a BDAR. The regulatory intent is to ensure that offsets address only genuinely unavoidable residual impacts, not impacts that could have been designed out with greater effort.

The draft regulation establishes a formal accreditation and regulatory framework for conservation brokers operating within the biodiversity credit market. Previously, brokerage activity in the NSW credit market occurred without a specific licensing or accreditation structure. The new framework is intended to improve pricing transparency, market integrity, and the confidence of both buyers and sellers in credit transactions. Alongside this, the regulation proposes to consolidate individual biodiversity stewardship site accounts into a common account structure, streamlining administration for what has historically been a fragmented system. Existing stewardship site holders will have an opt-out mechanism, providing some transitional flexibility.

Updates to the required content and standards for both BDARs and Biodiversity Certification Assessment Reports (BCARs) are also embedded in the draft regulation. State Significant Development (SSD) and State Significant Infrastructure (SSI) projects assessed under the Environmental Planning and Assessment Act 1979 (NSW) will be subject to the most demanding changes, with the net positive requirement potentially requiring offset packages that are materially larger than those calculated under the previous no net loss methodology. For high-biodiversity impact SSD projects, the cumulative effect of a higher avoid-and-minimise standard, restricted BCF access, and a net positive target could meaningfully extend approval timelines and increase offset procurement costs.

Australian context: how the NSW BOS reforms relate to national and state biodiversity frameworks

Australia does not have a single national biodiversity offsets framework equivalent to the NEPM for site contamination. Biodiversity offset regulation is primarily a state and territory responsibility, with the Commonwealth’s Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act) applying a separate offset policy to matters of national environmental significance. The NSW BOS, operating under the Biodiversity Conservation Act 2016, is one of the most established and market-oriented offset schemes in the country. The reforms now being finalised in NSW are therefore closely watched by practitioners and regulators in Queensland, Victoria, South Australia, and Western Australia, where biodiversity offset frameworks are either under review or at different stages of maturity.

Queensland operates the Nature Conservation Act 1992 and associated offset framework, which has undergone its own rounds of reform in recent years. Victoria administers the Native Vegetation Framework and the forthcoming reforms under the Environment Legislation Amendment (Nature) Act 2024, which signal a similar shift toward net positive outcomes. Western Australia continues to develop its offset framework under the Environmental Protection Act 1986, while South Australia applies offsetting through its own biodiversity policy instruments. The NSW reforms, particularly the move to a net positive standard and the tightening of avoid-and-minimise requirements, are likely to influence the trajectory of reform in these jurisdictions as state governments respond to Australia’s commitments under the Global Biodiversity Framework, including the 30 by 30 target to protect 30 per cent of land and sea by 2030.

References and related sources

• Primary source: www.nsw.gov.au
• nsw.gov.au
• nsw.gov.au
• nsw.gov.au
• nsw.gov.au
• EPBC Act

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This is an iEnvi Machete news summary. Prepared by iEnvi to summarise the source article for contaminated land, groundwater, remediation, approvals and site risk professionals.

Published: 19 Jul 2026

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