As the Environment Bill nears the end of its parliamentary progress, with the expectation that it will receive Royal Assent later this autumn, we now have more clarity on how Biodiversity Net Gain (BNG) will work in practice within the planning system.
Although the Natural Environment and Rural Communities Act 2006 already confers a duty on local authorities to conserve biodiversity when considering planning applications (as well as wider policy making), the Bill aims to strengthen this duty by adding the requirement to ‘enhance’ biodiversity. Part 6 of the Bill, ‘Nature and Biodiversity’, covers biodiversity gain as a condition of planning, a biodiversity gain site register and biodiversity credits. Overall, the most critical aspect for developers and local authorities is a statutory planning condition that commits developers to a 10% increase in biodiversity value post-development.
10% Biodiversity gain post-development
Section 7A of the Town and Country Planning Act 1990 will be amended to include a planning condition that requires developers to submit a Biodiversity Gain Plan demonstrating that the post-development BNG is at least 10% more than its pre-development value. Ecological appraisals, carried out before and after the development, will measure the gain made, using Natural England’s new 3.0 Metric that scores habitats according to their importance for plants and wildlife. Developers unable to achieve the requisite 10% biodiversity gain on-site, post-development, can either offset by going ‘off-site’ and negotiating a private offsetting arrangement in another location, or by purchasing biodiversity credits from the government. An offsetting arrangement can also be secured via a S106 agreement for council owned or controlled land capable of delivering the BNG in return for payment by the developer.
National register and biodiversity credits
Landowners and farmers will be encouraged to register land suitable for habitat enhancement or creation on a national register of BNG sites. The biodiversity value of registered land will be recognised using a system of biodiversity credits, bought by the government for sale to developers unable to meet the 10% gain on-site. Both developers and landowners must enter any arrangement for a minimum period of 30 years, secured via a planning obligation or conservation covenant.
Alternatively, developers can invest directly in local biodiversity projects by purchasing biodiversity units from landowners (or brokered via an intermediary), an example of which is provided by AC Lloyd’s offsetting arrangement with the Alscot Estate. The Environment Bill also provides for conservation covenants, which are private, voluntary agreements between a landowner and a ‘responsible body’ (Secretary of State, local authorities and conservation bodies), and of particular value for land of historic and cultural value. These covenants help landowners to safeguard the environmental and ecological integrity of the land in return for payment from the developer. They are binding on successors in title and enforceable on both sides.
Local nature recovery strategies
Another important element of the Environment Bill is the creation of Local Nature Recovery Strategies designed to cover England, and overseen by ‘responsible authorities’, which will include local authorities. They must prepare and publish their local strategy and report on action taken every five years. Biodiverse habitats identified within a LNRS will also generate units for BNG but will be subject to a 15% uplift in order to encourage developers to invest in these strategic sites.
Start planning for biodiversity net gain
The National Planning Policy Framework was updated in July 2021 to reflect these changes, noting that local planning authorities, when determining planning applications, should support developments ‘whose primary objective is to conserve or enhance biodiversity’. It adds that ‘opportunities to improve biodiversity in and around developments should be integrated as part of their design.’ For developers, this is critical: agreeing how the BNG will be achieved early on in the development and design process will be a crucial part of the overall planning process and will affect the type of site being considered, with some habitats being more valuable and thus more expensive to replace. Although the proposed new requirements are unlikely to become mandatory until 2023, developers would do well to use the intervening months to understand what this will mean in practice for their site pipeline.
We have advised a number of development clients on how to plan for Biodiversity Net Gain and would be delighted to discuss best practice and the options available.