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13/01/2022

Legal landscape: Biodiversity net gain will have to overcome many uncertainties

The mandating of biodiversity net gain in the Environment Act 2021 presents significant challenges to developers, landowners and local authorities, says Alice Davidson. It’ll take political will to overcome the uncertainties surrounding the scheme

The Environment Act 2021 represents a significant shake-up of procedures for many – from the ecologists, who view it as the most important conservation policy initiative in 30 years, to the government, for whom this is a major plank of the 25-year environment plan. And, of course, for the developers and landowners whose deals and developments will be looked at in a different light.

From November 2023, revisions to the Town and Country Planning Act 1990 require a mandatory 10 per cent biodiversity net gain (BNG) on new development. The legal requirement for a minimum of 10 per cent to be implemented in under two years is already affecting land sales and masterplanning. Many of its implications remain unknown.

The first is the extent to which BNG will be provided on-site (as meadows, wetlands, allotments and green roofs); off-site (by the developer purchasing, creating and managing habitats or paying a landowner to do so); or through the purchase of biodiversity credits to fund off-site habitat enhancements.

Defra estimates that 75 per cent of habitat creation could take place on-site. This is the second unknown: each planning application is unique. The propensity for ‘greener’ developments to attract higher prices (or alternatively for higher densities to be achieved on developable areas of the site), the suitability of sites for biodiverse features, the resulting viability (and therefore planning gain), the impact on land transactions, not to mention the availability and costs of off-site provision (which no doubt will change with increased demand) – these are all significant factors.

“Can we successfully create homes for first time buyers while creating habitats for frogs?”

Local planning authorities will be the arbiters of BNG but their motivations will vary depending on the relative demand for green spaces and housing and the weight given to biodiversity in their local plan. Needless to say, already overstretched local authorities will be affected; according to a recent investigation by the BBC, only 17 per cent have an in-house ecologist.

Farmed land (77 per cent of the UK’s landmass) is thought most likely to accommodate off-site BNG, through a contract between developer and landowner. But the selection of land for this purpose will be dependent on its proximity to the development site: adjacent land attracts a higher score under Biodiversity Metric 3.0.

Landowners face dilemmas based on unknowns. The shake-up of farming following cessation of the Common Agricultural Policy has led to a plethora of options to diversify, from ELMs payments to alternative energy. But hosting BNG credits is a 30-year commitment and a significant undertaking at times of considerable change. 

The propensity of BNG to halt biodiversity loss (which, as a product of climate change is an ambitious target in itself) depends on many factors: the need for a joined-up approach across local authorities, a willingness by developers not to ‘play the system’; a robust process for verifying and enforcing biodiversity in the long term.

It is also dependent on competing political ambitions. Until now, the predominant issue in planning was the housing crisis. Can we successfully create homes for first-time buyers while creating habitats for frogs? Can 10 per cent more biodiversity be achieved without a 10 per cent hike in house prices? There are many unknowns to be addressed before November 2023.


In brief

  • The new environment act mandates 10 per cent biodiversity net gain from November 2023
  • It’s unclear what form(s) this will take
  • Success will depend on local authority resourcing, collaboration, robust monitoring and the balancing of political goals.

Alice Davidson is an associate director at Boyer.

Image credit | iStock

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