The Environment Act 2021

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The Environment Act 2021

Published 25 January 2022

The Environment Act 2021 (“EA21”) which received Royal Assent on 9 November 2021 introduces a series of new provisions in England. Below are some of the key provisions with regards to biodiversity net gain (“BNG”).

Biodiversity net-gain

The EA21 introduces a mandatory minimum 10% BNG requirement for all new developments. This requirement is expected to come into force from winter 2023. BNG will be secured through a planning condition which is deemed to be attached to all planning permissions, requiring submission and approval of a biodiversity gain plan. Details on what those plans must contain will be provided by regulations yet to be made.  Consultation on those regulations is expected soon.

The details then approved through the plan will be secured through s.106 planning obligation or conservation covenant; or where that is not feasible, the purchase of biodiversity credits.

There will also be a publicly-accessible “biodiversity gain register” set up to provide information on each site which is bound by a conservation covenant or planning obligation for BNG.

The Act sets out the following key components to mandatory BNG:

  • Minimum 10% gain required calculated using the published Biodiversity Metric & approval of a net gain plan
  • Habitat secured for at least 30 years via s.106 planning obligations or conservation covenant
  • Habitat can be delivered on-site, off-site or via statutory biodiversity credits
  • There will be a national register of net gain delivery sites
  • The mitigation hierarchy still applies of avoidance, mitigation and compensation for biodiversity loss
  • The requirements also apply to Nationally Significant Infrastructure Projects (NSIPs)
  • BNG does not apply to marine development
  • BNG does not change other existing legal environmental and wildlife protections
  • BNG only applies in England and not the other devolved jurisdictions.

In summary, the primary objective will be on-site delivery of biodiversity net gain, followed by off-site provision where on-site is not possible. If the requirement cannot be met either on-site or at a specific off-site location for a development, then developers will be able to buy “biodiversity credits” in order to meet the biodiversity net gain objective.  It is not yet clear what criteria will be applied in order to accept the purchase of credits rather than on-site or off-site provision. It is clear though that this is designed not to be a cheaper and preferable option, as the EA21 specifically requires that the price of the credits should not be such as would “discourage the registration of land in the biodiversity gain sites register”.

Payments received for biodiversity credits will be put towards carrying out works for habitat enhancement, purchasing interests in land in England with a view to carrying out works of habitat enhancement and will also incorporate covering the operating and administration  costs of the credits scheme.

Local authorities will be required to publish biodiversity reports containing information on, amongst other things: actions taken to comply with biodiversity provisions in the EA21, the biodiversity gains resulting or expected to result from biodiversity gain plans approved by the authority and a summary of the authority’s plans for carrying out those functions over the five year period following the period covered by the report.

Housebuilders will need to consider the impact that these provisions will have on the viability and deliverability of future housing schemes. In particular the biodiversity value of a site may need to be appraised prior to the acquisition of development sites, and early thought will need to go into how the required net gain may be accommodated and whether by on-site provision, off-site local provision or the purchase of biodiversity credits (where that is an option), all of which will need to be factored into price calculations.  

It is not yet clear how this may play out in planning decisions, i.e. whether planning authorities may hold out for on-site provision where that is feasible but which means a reduction in the number of units being proposed, or in what circumstances they will allow credits to be purchased.  We await the government consultation on the statutory instruments and regulations that will underpin implementation of the BNG requirements.

Meanwhile a word of caution: the EA21 makes provision against anyone devaluing the biodiversity value of land before an application for planning permission is made and provides that where anyone carries out activities on land on or after 30 January 2020 otherwise than in accordance with a planning permission or another permission of a kind specified by the Secretary of State by regulations (yet to be made), and as a result of the activities the biodiversity value of the onsite habitat is lowered, then the pre-development biodiversity value of the onsite habitat is to be taken to be its biodiversity value immediately before the carrying on of those activities. 

For further advice on how to address these considerations please contact Anne Harrison, Christopher Stanwell or Andrew Morgan.

Authors

Anne Harrison

Anne Harrison

Bristol

+44 (0)117 918 2731

Nadine Kamalaneson

Nadine Kamalaneson

London - Walbrook

+44 (0) 20 7894 6590

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