How does Biodiversity Net Gain affect landowners and developers?

Tounderstand how Biodiversity Net Gain (BNG) impacts developers and landowners, we must first explore what it is and its role in the context of land development.

What is BNG?

BNG is an approach that aims to leave the natural environment in a measurably better state than before by creating or enhancing habitats in association with development.

The Environment Act 2021 imposes a mandatory requirement for a minimum 10 percent increase in biodiversity compared to the pre-construction condition of the development site. This will apply from November 2023, unless a development is exempt. From this date, every planning permission granted for development in England will include a planning condition that development cannot commence unless a BNG plan has been submitted to, and approved by, the Local Planning Authority (LPA).

BNG is measured using Defra’s Biodiversity Metric which evaluates changes in the extent and quality of habitats for nature and compares the habitat found on a site before and after development.

The Act sets out a ‘mitigation hierarchy’ which encourages developers to first seek to avoid harm by mitigating and enhancing biodiversity measures on-site. If this can’t be done, developers should aim to secure local compensatory habitat creation through the purchase of local biodiversity units.

As a third and final option, developers must purchase statutory credits to fund local and national conservation and natural capital priorities.

BNG and landowners

If you are a landowner, you can consider different options for the delivery of BNG on your land, including habitat banking, or selling BNG units to a developer through a habitat bank operator, a broker, or via a trading platform.

A 30-year commitment is required, which will be documented within a legal agreement.

Landowners should also think about whether BNG units can be combined with other environmental payments. Obtaining specialist tax advice is strongly recommended.

BNG and developers

Developers should consider BNG at the site selection stage and ensure that it feeds through to the design proposals.

BNG will have an impact on the negotiation of land agreements, including options, promotions, and conditional contracts.

Consideration should be given to unconditional dates, onerous conditions, and the deduction of associated BNG costs.

Developers can also benefit from commercial opportunities, such as purchasing additional land for habitat banking or offsetting their own BNG requirements.

How can Lodders help?

Since 2020, Lodders has worked with many landowner clients to develop and facilitate biodiversity management agreements with local authorities that were early adopters of the BNG policy.

The BNG units created under these management agreements have been successfully sold off to developers to discharge their BNG obligations.

We can advise on the developing law surrounding BNG, and act on your behalf in establishing habitat banks or in entering into agreements with the LPA or responsible body.

Victoria Longmore

E: victoria.longmore@lodders.co.uk

T: 01789 206119

Fromparticipating in boat races to ballroom dancing, there is no denying that Lodders people are a talented bunch and are always prepared to go above and beyond to help raise money for worthy causes. At Lodders, we believe that all charitable involvement, big or small, is important and worthwhile.

Here are some of the great ways our team members have supported charities.

Racing to the finish line

Nicole Harrison, legal secretary in Lodders’ Real Estate team, participated in the Dragon Boat Race on 16 October 2022. A total of 17 teams competed and the event raised £25,000 for The Shakespeare Hospice. With less than one second making the difference between first and second place, we are very pleased to say that Nicole’s team, SUP Stratford, was crowned the winning team!

Being a friendly face

In February 2022, members of our Care & Capacity team completed the Dementia Friends course. Gemma Bryan, Sharon Crosby, Michael Neal-Brook, and Jacqui Brampton all took the course to learn more about dementia, so that they can support their community. Dementia Friends helps to raise awareness and understanding about dementia, so that people with the condition can continue to live in the way that they want.

Rocking out

Stuart Price, partner in Lodders’ Commercial team, performed in a band at Tunsfest, an annual music festival held at the Three Tuns Public House in Sutton Coldfield, to raise money for local charities The popular event often sells out, with around 700 people attending and 10 bands playing each year.

Mental health support

Andrew Wylde, commercial litigation solicitor in our Dispute Resolution team, is a Trustee of Birmingham Mind Andrew is heavily involved in the provision of support services to individuals with mental health needs in the West Midlands area. Founded in 1962, Birmingham Mind supports more than 25,000 people every year.

On your bike!

In July this year, Mike Wakeling, partner in Lodders’ Dispute Resolution team, took part in the Molly Ollys charity bike ride. The ride took place from 7 to 9 July 2023, running from Exeter to Warwick. The bike ride was in aid of Molly Ollys, a charity that grants wishes to children with life-threatening illnesses.