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What Makes A Bank A Bank? Differences and Commonalities in Credit Calculation, Application, and Risks in Mitigation Banks Targeting Freshwater Fish Species and Associated Ecosystems

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Abstract

Mitigation banking is part of the ever-expanding global environmental market framework that aims to balance negative approved anthropogenic impacts versus third-party provided ecosystem benefits, sold in the form of credits. Given the need to conserve freshwater biodiversity and habitat, banking has received great traction for freshwater species and systems. While extensive reviews and studies have been conducted on evaluating if equivalency between impacts and offset can be achieved, there is almost no research being done on the way credits are being generated and banks are managed to inform future best practice and policy. Synthesizing banking data through cluster analyzes from 26 banks in the United States generating credits for freshwater species and associated systems, we show two generalizable approaches: removing barriers and targeting whole communities. Both address crucial freshwater conservation needs but come with their risks and caveats. Using common characteristics and management practices founded in federal and district level guidance within these two groups, we showcase and conclude that credit generation via barrier removal can be at risk of granting credit generation for too large of an area, leading to over-crediting. Banks targeting whole freshwater communities and accounting for landscape-level interactions and influences can potentially be detrimental for species on an individual level and large-scale credit availability as well as transfer can incentivize non-compliance with the mitigation hierarchy.

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Data Availability

Data and additional material are available through contacting the authors, freely available on RIBITS and in the supplemental material or through figshare: https://doi.org/10.6084/m9.figshare.22864019.

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Acknowledgements

Funding for this project was provided by Mitacs Cluster Accelerate (RES0027784) and Converge (RES0021639) grants to M.P. We want to further acknowledge the role that open access data and scientific material plays in conducting research. Mitigation banking data is freely available through RIBITS, and scientific symbols used to enhance figures were provided through ian.umces.edu under the Attribution-ShareAlike 4.0 International (CC BY-SA 4.0) agreement. We want to thank Richard Kavanagh and Jason Shpeley from Fisheries and Oceans for their constructive and invaluable feedback.

Author Contributions

ST: Conceptualization; Formal Analysis; Investigation; Methodology; Project Administration; Visualization; Writing – Original Draft Preparation; Writing – Review & Editing. MP: Conceptualization; Methodology; Writing – Review & Editing

Funding

Funding

Funding for this project was provided by Mitacs Cluster Accelerate (RES0027784) and Converge (RES0021639) grants to M.P.

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Correspondence to Sebastian Theis.

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Theis, S., Poesch, M. What Makes A Bank A Bank? Differences and Commonalities in Credit Calculation, Application, and Risks in Mitigation Banks Targeting Freshwater Fish Species and Associated Ecosystems. Environmental Management 73, 199–212 (2024). https://doi.org/10.1007/s00267-023-01926-6

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  • DOI: https://doi.org/10.1007/s00267-023-01926-6

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