What is Biodiversity Net Gain?
Biodiversity Net Gain (or BNG) is a principle which aims to leave the natural environment in a measurably better state after development than beforehand. The requirements set down by law will apply to all sites (save for exempt sites) from November 2023.
Background to BNG
Following a consultation in December 2018 which first considered BNG proposals, the government confirmed its intention to bring in new law which would require new developments to deliver a net increase in biodiversity of at least 10% on sites. In November 2021, the Environment Act 2021 received Royal Assent and so it was that the requirement entered the statute books and became mandatory.
A series of further consultations and responses ensued, discussing the practicalities of implementing the scheme and its scope, with the result that as of November this year, Defra's new biodiversity metric version 4.0 will form the basis of calculating BNG.
New legal requirement to provide BNG
The new statutory provisions introduce the concept of a 'biodiversity gain objective'. This is met if the "biodiversity value attributable to the development" exceeds the pre-development biodiversity value of the onsite habitat by at least 10%.
The "biodiversity value attributable to the development" is the total of:
- The post-development biodiversity value of the onsite habitat, and
- The biodiversity value of the development of any registered offsite biodiversity gain allocated to the development, and
- The biodiversity value of any biodiversity credits purchased for the development.
The outcome of the legislative changes is that every planning permission granted for the development of land in England (including deemed planning permission) that results in a loss or degradation of habitats, will have a mandatory condition imposed (or deemed to be imposed) to secure the 10% BNG.
BNG will not apply to:
- Development impacting habitat of an area below a 'de minimis' threshold of 25 metres squared, or five metres for linear habitats such as hedgerows
- Householder applications
- Biodiversity gain sites (where habitats are being enhanced for wildlife), and
- Small scale self-build and custom housebuilding
BNGG will, however, apply to:
- Previously developed land;
- Temporary permissions;
- Change of use applications;
- Development that would be permitted development but for its location (eg. conservation areas, national parks, etc).
Clearly, where a habitat is irreplaceable, any harm which might be caused by a development cannot be mitigated by either on- or off-site measures, including the purchase of credits. In the case of development which has the effect of impacting an irreplaceable habitat, new Regulations will be required to ensure that sufficient measures are taken to minimise the adverse impacts of the development on those habitats.
Transition period for small sites
Government has confirmed that there will be a transition period until April 2024 for small sites to provide BNG. Until then, small sites will be exempt from having to provide on- or off-site BNG.
Small sites are defined for the purpose of the BNG exemption as:
- for residential: where the number of dwellings to be provided is between 1-9 (inclusive) on a site of less than 1 hectare, or where the number of dwellings to be provided is not known on a site area of less than 0.5 hectares;
- for non-residential: where the floor space to be created is less than 1,000 square metres, or where the site area is less than 1 hectare.
We may also see Regulations to modify the application of BNG in relation to:
- Outline permissions where reserved matters indicate the need for phasing
- Permission for development which can be carried out in phases, and
- S73 permissions (only if the original permission was granted after November 2023).
Calculating 10% net gain – the technical bit
The biodiversity value of any habitat is to be calculated in accordance with the Defra biodiversity metric (as updated from time to time).
The Government has confirmed that the next version of the biodiversity metric, metric 4.0, will be published by November 2023 and will form the basis of the statutory metric for the purposes of statutory BNG.
Importantly, where activity is carried out on land on or after 30 January 2020, without planning permission, which causes the onsite biodiversity value to be lowered, that activity is not taken into account when calculating the site's pre-development biodiversity value.
The post-development biodiversity value is the projected value of the onsite habitat as at the time the development is completed. Proposals for BNG works can only be considered as part of the post-development biodiversity value if the gain will be maintained for at least 30 years after completion of the development, and secured by either a condition, a s106 or a Conservation Covenant.
How is off-site biodiversity gain provided?
Off-site biodiversity gains can be registered and biodiversity credits are to become available, which can be taken into account in deciding whether a development meets the biodiversity gain objective.
Registered off-site biodiversity gain is essentially biodiversity gain achieved on land other than the development site, which is subject to an arrangement so that it can be counted towards the development meeting the biodiversity gain objective.
Natural England will be setting up a Biodiversity Site Gain Register (hopefully very soon!), which will be a register of parcels land:
- In respect of which a person is required to carry out works to enhance the biodiversity of the habitat under a conservation covenant or planning obligation
- That person (or another person) is required to maintain the enhancement for at least 30 years after the completion of those works, and
- The enhancement is made available to be allocated in accordance with the terms of the covenant or obligation to one or more developments for which planning permission is granted.
Probably the most controversial element of the proposals: biodiversity credits can be bought and sold in connection with development, so that development can meet the biodiversity gain objective.
The price of credits has now been published and there remains much scepticism over the Register being used to simply 'buy' planning permissions. The cost of the credits is set prohibitively high in an attempt to prevent this from happening and to enable a real impact to result from the credits purchased. The list can be found at https://www.gov.uk/guidance/statutory-biodiversity-credit-prices and prices range between £42,000 and £650,000 per credit.
Payments received for the credits will be used to fund biodiversity enhancements, including to purchase land to do so, and the Secretary of State will be reporting annually on their use.
What does this mean for landowners?
Landowners will be able to register their parcels of land on Natural England's Register, details of which will be publicly available and open to bids to obtain credits on.
For those selling (or thinking of selling) land which may be suitable for registration as a 'BNG site', a crucial part of the transaction will be to assess the true value of the land to those buying the land and the purpose to which it is intended to be put. Ecological and financial consultants will be able to assist in providing an accurate valuation of the land to those buying and selling appropriate land.
How can planning decisions achieve BNG?
In terms of how BNG can be achieved, the PPG advises that:
- Planning conditions or s106 obligations can, in appropriate circumstances, be used to require that a planning permission provides for works that will measurably increase biodiversity. This could involve creating new habitats, enhancing existing habitats, providing green roofs, green walls, street trees or sustainable drainage systems. It notes that relatively small features can often achieve important benefits for wildlife, such as incorporating 'swift bricks' and bat boxes in developments and providing safe routes for hedgehogs between different areas of habitat;
- Benefits can be achieved entirely on-site or by using off-site gains where necessary. Offsite measures can sometimes be secured from 'habitat banks', which comprise areas of enhanced or created habitats which generate biodiversity unit 'credits'; and
- Care needs to be taken to ensure that any benefits promised will lead to genuine and demonstrable gains for biodiversity. Discussions with local wildlife organisations can help to identify appropriate solutions, and tools such as the Defra biodiversity metric can be used to assess whether a biodiversity net gain outcome is expected to be achieved. It cautions that LPAs need to make sure that any evidence and rationale supplied by applicants are supported by the appropriate scientific expertise and local wildlife knowledge.
Proposed NPPF reform
Government's most recently closed consultation package looked further into measures to ensure that BNG can deliver, and wider opportunities to support BNG and biodiversity generally.
Whilst much has been progressed over the last couple of years, it is clear that there is a lot of detail still remaining and further consultations have been proposed on a variety of issues, including further secondary legislation and revisions to the NPPF.
Time is of the essence
If government (and everyone else involved) is to secure BNG in the way in which it envisages, starting in November this year, there are many strings to pull together in order to make it happen, including landowners, local authorities, ecologists, developers, lawyers, committee members, Inspectors. Everyone will need to act quickly in reaction to revised guidance issued by Defra and be prepared to fully update those who rely on their advice.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.