Biodiversity Net Gain offers interesting opportunity for landowners

Biodiversity Net Gain (BNG), introduced in the Environment Act 2021, will be a mandatory requirement from November 2023 for all planning permissions granted in England.

It will require all planning applications to deliver at least a 10% increase in biodiversity compared with the starting position . The BNG will either be delivered by on-site or off-site biodiversity provisions or purchasing biodiversity ‘credits’. Biodiversity is measured using the Biodiversity Metric 4.0 calculator that has been published by DEFRA. Biodiversity net gain (or loss) is calculated using the difference between the pre-development and post development habitat data.

This creates an opportunity for landowners and their advisors to monetise habitat creation by providing off-site biodiversity provisions which can be sold to developers. This will be an attractive option to developers as it will allow them to maximise house building density without having to provide on-site BNG. Depending on the scale of the development it could require extensive amounts of land to deliver at least 10 percent net gain. The other advantage to developers is that once the site has been built , they do not need to continue with habitat management as it will be the responsibility of the landowner providing the offsite units to deliver the ongoing management.

For example, the landowner establishes their baseline, creates a biodiversity habitat that works within their current farming model, then sells the biodiversity units generated from the creation of that habitat directly to developers.

The off-site biodiversity gains will need to be secured through either a conservation covenant or a planning obligation. There will be a legal requirement to manage the units for a period of at least 30 years so it is a long term commitment for landowners and any future generations.

Habitats created after 30th January 2020 will be eligible for registration and sale of units. There is no time limit on how long units can be ‘banked’ before being allocated and sold.

Natural England will also play a role in implementing BNG as it will be given responsibility for selling statutory biodiversity with the prices being reviewed every six months and prices will be set to be ‘intentionally uncompetitive with the market’. There may be tax implications associated with utilising land for selling units to the biodiversity markets and further guidance is expected from the government in due course. n

Kitty Campbell 07385 930 697