Biodiversity Credits — Frequently Asked Questions
What are biodiversity credits?
Biodiversity credits represent verified units of biodiversity gain — measured improvements in the quality and extent of habitat for wildlife, plants, and ecosystems. They allow developers, corporations, and governments to offset their biodiversity net loss (from construction, land use change, or agricultural intensification) by purchasing equivalent verified biodiversity gains created elsewhere.
The biodiversity credit market is valued at $600 billion with a 20% annual growth rate — the fastest-growing segment of the natural capital market after plastic credits — driven by the Kunming-Montreal Global Biodiversity Framework (GBF) and mandatory Biodiversity Net Gain (BNG) requirements in the UK and EU.
What types of biodiversity credits does NCRB support?
| Sub-type | Description |
|---|---|
| Habitat Restoration Credits | Credits from restoring degraded ecosystems — wetlands, grasslands, woodlands |
| Species Conservation Credits | Credits from projects protecting or increasing specific threatened species populations |
| Biodiversity Offsets | Mandatory offsets required under planning or environmental permitting law |
| Nature-Based Solutions (NbS) | Integrated projects delivering multiple ecosystem services alongside biodiversity gain |
Which standards and registries are supported?
| Standard | Notes |
|---|---|
| Plan Vivo | Community-based nature and livelihoods standard |
| Verra (VCS + SD VISta) | Combined carbon and biodiversity verification |
| NatureQuant | Quantitative biodiversity metric for natural infrastructure |
| Terrasos | Biodiversity certificate standard from Colombia |
| UK Biodiversity Metric 4.0 | Mandatory statutory metric under UK Environment Act 2021 |
How is biodiversity quality measured?
NCRB uses the UK Biodiversity Metric 4.0 distinctiveness scale as the primary quality reference — the most widely adopted quantitative biodiversity measurement system:
| Distinctiveness Level | Code | Habitat Examples | Typical Value |
|---|---|---|---|
| Very High | D6 | Ancient woodland, species-rich grassland, lowland fen | $30,000–$100,000 / hectare |
| High | D5 | Broadleaved woodland, upland heath, coastal dune | $20,000–$50,000 / hectare |
| Medium | D3–D4 | Hedgerow, orchard, secondary woodland | $10,000–$30,000 / hectare |
| Low | D1–D2 | Improved grassland, arable field margins | $5,000–$15,000 / hectare |
| NatureQuant A | — | High-scoring natural infrastructure index | $25,000–$80,000 / hectare |
| Species Banking | — | Verified species-specific conservation | $50,000–$200,000 / credit |
Minimum eligible distinctiveness: D3 or above. D1–D2 habitats are not eligible for tokenization.
What are the minimum requirements to tokenize a biodiversity credit?
- Biodiversity Net Gain (BNG) verification under UK Biodiversity Metric 4.0 (or equivalent national methodology)
- Third-party ecological assessment by a qualified ecologist
- Minimum D3 distinctiveness rating
- 30-year conservation covenant securing the habitat in place
- Annual monitoring plan with reporting obligations
- Compliance with the no net loss principle — credits cannot be created by actions that simply avoid destroying habitat
- Token issued as
NC-BIO-{ID}(ERC-7943 uRWA)
How is quality rated?
Biodiversity credit tokens receive a programmatic quality score (0–100) across six weighted dimensions — the same framework used across all NCRB asset classes (Technical Quality 25%, Additionality 20%, Permanence 20%, Certification Level 15%, Social Impact 12%, Vintage/Condition 8%).
For biodiversity credits, Permanence captures the covenant length and legal enforceability. Technical Quality reflects the distinctiveness level and habitat condition baseline. Social Impact captures Indigenous engagement and community co-benefits.
| Band | Score |
|---|---|
| AAA | 85–100 |
| AA | 75–84 |
| A | 65–74 |
| BBB | 50–64 |
| Not Eligible | < 50 |
What global frameworks are biodiversity credits aligned with?
- Kunming-Montreal Global Biodiversity Framework (GBF) — 30×30 target (protect 30% of land and ocean by 2030)
- TNFD — Taskforce on Nature-related Financial Disclosures
- UK Environment Act 2021 — mandatory 10% BNG for major developments
- CSRD E4 — EU Corporate Sustainability Reporting Directive biodiversity disclosures
- SBTN (Science-Based Targets for Nature) — no net loss and net positive biodiversity targets
Why is the biodiversity credit market growing so fast?
Three regulatory catalysts are driving the 20% CAGR:
- UK mandatory BNG (effective February 2024) — all major planning applications must deliver a minimum 10% biodiversity net gain using the statutory metric
- EU Nature Restoration Law (effective 2024) — binding restoration targets across 30% of degraded EU habitats
- Kunming-Montreal GBF — 196 signatory nations committed to 30×30 and financing the biodiversity gap
Corporate TNFD and CSRD disclosure requirements are adding further demand from institutional investors and multinational companies.
How is token revenue distributed?
| Recipient | Share |
|---|---|
| Asset Owner | 70% |
| Registry Partner | 10% |
| NCRB Platform | 10% |
| Third Party (aggregator / referrer) | 10% |
What fees apply?
- Trading fee: 2.5% per transaction
- AUM fee: 1.5% annually
- BaaS licensing: $50,000–$200,000 for registry partners