The Environment Bill (E.B.) has seen a long drawn out journey through Parliament so far. The latest mood music is that it will receive Royal Assent in Autumn 2021. Whilst the formal regime will not go live until 2023 it is important to note that biodiversity gain (B.G.) is currently a requirement of the National Planning Policy Framework and Planning Policy Guidance and Local Authorities are applying it through their local polices. Regardless of the time delay this is having very real implications at this point. It is certainly worth preparing now for the implementation of some of the more innovative new provisions, and most especially those around the introduction of B.G. conditions.
The Bill will introduce a new requirement on all developments to provide a 10% increase in the biodiversity value of land being developed. In summary:
- Grant of planning permission will be subject to a pre-commencement condition requiring a B.G. plan to be approved;
- Where 10% on site B.G. gain cannot be achieved, then it may be achieved through off site works or through the purchase of biodiversity credits – through a scheme likely to be run by Natural England who ran a pilot last year
- Enhancement schemes may be enforced through s106 obligations or through ‘Conservation Covenants’ and are required to be maintained for at least 30 years;
- The 10% gain requirement may be ratcheted upwards in future
The Bill does not apply to Nationally Significant Infrastructure Projects or Marine developments. There are discussions underway looking to incentivise biodiversity gain in these areas.
Secondary Legislation will be required to address what form biodiversity gain plans may take as well as addressing exemptions, how to deal with issues of degradation and phased development. There is expected to be a consultation released later this year to address such issues. The metric (3rd version) for assessing the biodiversity value is also expected to be released this Spring, with the Bill expected to receive Royal Assent in the Autumn. This will be followed in the Winter when the register and credit sales platform will go live. B.G. will become a legal requirement, two years following Royal Assent, which means that if it is passed this year, B.G. will be a requirement from 2023.
Conservation Covenants will be legally binding private voluntary agreements between landowners and responsible bodies and can be used in the alternative to Planning Obligations to secure B.G.
How proposals work in practice
A biodiversity metric will be populated with habitat information from the site assessment and landscape plans to demonstrate early on that harm has been avoided and that new green infrastructure will be of good environmental quality. Metric data will be able to anticipate any costs of achieving the net gain. Wherever possible preventing damage to nature will continue to be prioritised.
If a 10% net gain cannot be achieved the metric would provide information for discussions with the local planning authority (L.P.A) about habitat enhancement or creation. Tariff rates will give guides as to the upper limits of habitat compensation costs.
The three options below set out how biodiversity net gain can be achieved under the policy proposals:
- Onsite (units) -The developer can avoid harm by mitigating and enhancing on site;
- Offsite (units) - If the developer is unable to avoid harm, mitigate or compensate all impacts but is able to secure local compensatory habitat creation or enhancements to offset the harm proposed to be caused on the development site;
- Statutory Credits - If unable to avoid harm, mitigate or compensate on site and unable to find local compensatory habitat a tariff would be imposed to fund cost effective habitat creation projects according to local and national conservation and natural capital
Considerations for Developers
Developers should be starting to consider B.G. now, certainly at the stage of site selection or outline design. Developers should begin considering:
- Undertaking baseline metric calculations
- Determining how to deliver strategy
- How land will be maintained
- Submitting net gain and completed metrics to the P.A. and engage early in discussions
- Timings of the planting progress
- Availability of credits and value implication
- Transactional costs
- Secure offsite credits consideration
- Being aware of local priorities (and local politics)
Benefits to Developers
There is a commercial gain to be had from B.G. delivering onsite greener spaces can make a development more appealing, having the potential to increase plot prices due to the immediacy of access to green space. It must be considered however that delivery of B.G. onsite may have a commercial impact if plot density is affected, and good habitat value may be at odds with public access. It is at this stage that offsite compensation may need to be considered. It is about striking the right balance for developer and the environment.
Further Information to Note
The metric requires like for like provision or better. There is some scope to substitute habitats, but developers should consider site selection for offsite delivery early.
Until the E.B. becomes law there are limited opportunities available to developers to start actively planning for offset credit. Current options include asking a broker to identify and secure appropriate offsetting land, identify and purchase credits for a habitat bank which provides an ‘off the shelf’ solution to create habitat elsewhere and tripartite s106 agreements in which a third party related to the delivery of B.G. as a signatory to the s106 will help ensure its delivery.
The B.G. requirement has the potential to be costly and it is important to consider whether
B.G. will affect viability. Standard B.G. conditions will be imposed by statute, ranking higher than other policy requirements. Developers are advised to engage early with the L.P.A. submitting a draft biodiversity plan to reduce the impact on timing and unanticipated costs of development.
The L.P.A. will themselves monitor the biodiversity of sites so degradation of land by developers prior to the initial biodiversity calculation will not be possible.
Top Tips
- The developer needs a clear robust picture of biodiversity value early in the scheme preparation, alongside this regular baseline monitoring will support the B.G. plan.
- For most schemes, pre-development biodiversity value will be calculated at the date of the application even though the B.G. plan is not required to be submitted until after Planning Permission is granted. Early engagement with landowners and 3rd party organisations will ensure that developers can identify and utilise off site mitigation land and build such schemes into their submissions to the council.
- In practice, it may be advisable to submit the B.G. plan with the Planning application or at least a draft to encourage discussion and to resolve issues early.
