Environmental mitigation

Environmental mitigation, compensatory mitigation, or mitigation banking, are terms used primarily by the United States government and the related environmental industry to describe projects or programs intended to offset known impacts to an existing historic or natural resource such as a stream, wetland, endangered species, archeological site or historic structure. To "mitigate" means to make less harsh or hostile. Environmental mitigation is typically a part of an environmental crediting system established by governing bodies which involves allocating debits and credits. Debits occur in situations where a natural resource has been destroyed or severely impaired and credits are given in situations where a natural resource has been deemed to be improved or preserved. Therefore, when an entity such as a business or individual has a "debit" they are required to purchase a "credit". In some cases credits are bought from "mitigation banks" which are large mitigation projects established to provide credit to multiple parties in advance of development when such compensation cannot be achieved at the development site or is not seen as beneficial to the environment. Crediting systems can allow credit to be generated in different ways. For example, in the United States, projects are valued based on what the intentions of the project are which may be to preserve, enhance, restore or create (PERC) a natural resource.

Environmental mitigation and crediting systems are often praised for the following reasons:

Mitigation is a more development-friendly alternative to strict environmental laws because it allows development to occur where environmental laws might prohibit it.

Mitigation inevitably creates a "mitigation industry". By requiring those who impact natural resources to purchase credits, a demand for mitigation credit is formed. Businesses related to environmental work typically benefit from such a system.

Mitigation has the potential to save and restore the most valuable environmental resources at the least cost, assuming that regulation 1) protects health and welfare as defined by the National Environmental Policy Act (NEPA) and 2) assures that a credit accurately represents measurable ecological value. Buyers are typically looking for mitigation credits that are both cheap and the most likely to meet regulatory requirements for compensatory mitigation. Regulators must therefore find a balance between protecting the long term public interest and ensuring that buyers have the proper incentives to participate in the environmental marketplace.

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