First-generation compensation plans (CPs) for Dutch highway projects have been evaluated with respect to implementation of the compensation principle (1993), which aims to counterbalance the adverse ecological impacts of large-scale development projects. Decision-making on the seven projects took place between 1993 and 1995. Specifically, we considered: (a) the processes employed to prepare and implement the compensation plans; (b) the methods used to identify, plan, and execute the compensation measures; and (c) the results yielded by these methods. We conclude that the CPs were prepared fairly uniformly, particularly in terms of the processes and methodologies used to derive compensation measures. Five of the seven CPs had become operational by 2001 and initial experience is now being gained on land acquisition and transfer of compensation sites to nature conservation trusts. Further progress of CPs is likely to be seriously hampered by growing demand for land for development in general and associated increases in real estate prices. Several problems are addressed and recommendations made with respect to: (a) developing a legal basis for the compensation principle; (b) the relationship with re-allotment projects; (c) estimation of compensation costs; (d) an annual bias of CP budgets to account for rising costs; (e) contingency measures; and (f) criteria for CP (ex-post) evaluation.