Biodiversity Net Gain Update

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Following our Biodiversity Net Gain Round-Up in August, Defra has published a number of new guidance documents  and draft legislation  on biodiversity net gain (BNG). In this article we take a look at some of the key implementation provisions and next steps for developers and local planning authorities (LPAs).

Implementation of biodiversity net gain

From January 2024 all planning applications, if granted, will contain a condition that requires 10 per cent BNG to be provided. The exact implementation date in January is yet to be confirmed, and is dependent on parliamentary timetabling. This general commencement rule is subject to transitional provisions, limited exemptions* and small site exceptions (please see below for further details). 

BNG plans will be required for small sites from April 2024. Small sites are defined as residential sites that are less than one hectare in size and with one to nine dwellings, or less than 0.5 hectares if the number of dwellings is unknown. Non-residential sites that are less than one hectare, or where the floorspace that will be created is less than 1000 square metres, will also be classed as small sites.

Public consultation responses on BNG, also suggested it should be extended to marine developments, although this is not marine BNG is not yet mandatory. Please see our other article for further details.

Measuring biodiversity net gain

BNG is measured using a statutory biodiversity metric that relies on habitat features to calculate biodiversity values. Natural England previously indicated that the new biodiversity metric 4.0 would be the basis for the statutory metric. Defra has stated that guidance on changes since 4.0 will be published in due course.

Where planning permission is granted pursuant to a planning application, the date of the planning application is the baseline for measuring BNG. In any other cases, it is the date on which the planning permission is granted. However, the applicant may agree with the LPA that the date for the baseline is an earlier date. 

Degradation of habitats 

If a site already has the benefit of an existing planning permission, and activities are carried out after 25 August 2023 that lower the biodiversity value, then the base line for BNG is the biodiversity value immediately before the activities were carried out. 

Whereas, if there has been unauthorised degradation of habitats since 30 January 2020, the pre-degradation habitat will be taken as the baseline for measuring BNG. This is to deter landowners and developers from clearing habitats prior to biodiversity being assessed. 

Mitigation hierarchy

The BNG can be achieved by increasing or enhancing on-site or off-site habitats, or purchasing statutory credits. All three options, on-site, off-site and statutory credits, may be used to achieve the requisite 10 per cent BNG, however, the mitigation hierarchy must be followed when developers are planning how to deliver BNG. 

Broadly speaking, the mitigation hierarchy requires developers to avoid adverse effects on onsite habitats, mitigate adverse effects where they cannot be avoided, if mitigation is not possible then enhance onsite habitats, and where onsite habitats cannot be enhanced then create new onsite habitats. If new habitat cannot be provided onsite, then off-site BNG must be secured, and as very last resort purchase off-site credits.

Compensation for irreplaceable habitats will not usually be counted towards 10 per cent BNG, although buffer zones around irreplaceable habitats will also be subject to the 10 percent BNG requirement.

BNG plans must include details about how adverse effects on irreplaceable habitats will be minimised and compensated.

Approval of biodiversity net gain plans

A BNG plan must be approved under the planning permission condition before development can be lawfully commenced, and is subject to the usual 8 week determination period for the discharge of planning conditions. Applicants have 6 months, from the date of the LPAs decision, to appeal a refusal of a BNG plan. 

Phased Developments

Phased developments, meaning either a phased outline planning permissions, or any type of planning permission where the conditions have the effect of requiring development to be phased, will require a overall BNG plan to be approved before any development can commence. The overall BNG plan must set out an “upfront framework for how the biodiversity gain objective of at least a 10% gain is expected to be met across the entire development”.   A phase BNG plan will then need to be approved by the LPA before any development commences within that phase.  

Section 73 applications to vary original planning permissions

The requirement to provide 10 per cent BNG will apply to a s.73 application where the application for the original planning permission was made, or the original planning permission the was granted, after the implementation  of BNG regulations January 2024.

Where a s.73 application relates to an original planning permission applied for, or granted, after the BNG implementation in January 2024, a new BNG and/or habitats compensation plan is only required where the s.73 variation affects the post development biodiversity value and/or would have materially different adverse effects on irreplaceable habitats. A s.73 application cannot be used to vary or remove the BNG condition.  

How will biodiversity net gains be secured?  

LPAs and developers will need to consider whether the BNG condition can be discharged through the provision of on-site BNG, and if a s.106 agreement, or conservation covenant will be also required to secure significant on-site gains. Any off site BNG will need to be secured under a s.106 agreement or conservation covenant before planning permission is granted.

The BNG will need to be maintained for 30 years from the date of completion of the buildings and the BNG itself. Therefore, a clear point of completion will need to be agreed between LPAs and developers to ensure there are no future disputes.

Next steps

Landowners, developers and LPAs need to prepare for the implementation of BNG in January 2024. 

Developers should seek specialist ecology advice on whether BNG that can be delivered on-site, or  if they need to purchase off-site biodiversity units. As discussed in our previous article, Biodiversity Net Gain Round-Up, there are opportunities for landowners and developers to register and sell excess biodiversity units, as well as stack BNG units and nutrient credits to maximise revenue.

LPAs should ensure local policies, including local nature recovery strategies, are up to date and  accessible for persons who need to discharge BNG conditions, or who are interested in setting up habitat banks. LPAs will also need to consider if consultants are required to review BNG calculations, instructing legal advisers to draft precedent conservation covenants and s.106 obligations, and setting up processes for monitoring compliance with BNG. 

Ashfords regularly advises developers and LPAs on structuring credit schemes and habitat banks, as well as compliance with the rules on BNG and nutrients

If you have any queries or would like further information on BNG and credit schemes, please contact our planning team.

*Sites exempted from the requirement to deliver 10 per cent BNG include: temporary exemption until April 2024 for developments that are not defined as major developments; householder development; permitted development; development that does not impact a priority habitat and impacts habitat of an area below a ‘de minimis’ threshold of 25 square metres, or 5 metre linear habitats (e.g. hedgerows); small scale self-build and custom build housing development of up to 9 dwellings, and on area up to 0.5 hectares; urgent crown development; development undertaken solely or mainly for the purpose of fulfilling a BNG planning condition for another development; and  development for the high speed railway transport network. However, planning policy will be developed to secure ‘proportionate on-site biodiversity enhancements’ for small sites.

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