How will the Nature Restoration Levy operate under the Planning and Infrastructure Bill?

The Nature Restoration Levy (NRL), introduced under sections 61-70 of the Planning and Infrastructure Bill, requires developers to financially contribute to the restoration of environmental features impacted by their developments. This levy ensures that the cost of environmental restoration is addressed by the developers responsible for the damage, rather than relying solely on public funds. It directly supports the recovery of protected sites, habitats, and species, in line with the objectives set out in key environmental legislation such as the Habitats Regulations 2017 and the Wildlife and Countryside Act 1981.

According to section 61(1) of the Planning and Infrastructure Bill, developers may request to pay the NRL before development begins, provided their project falls under an environmental development plan. The payment of the levy helps avoid or mitigate harm to protected features and ensures that conservation activities are funded through the development process.

In this article, we detail how the NRL will operate under the Planning and Infrastructure Bill and highlight the commercial impacts for developers and stakeholders.

How will the Nature Restoration Levy operate?

Under the Planning and Infrastructure Bill, once the developer requests the NRL, Natural England must accept this request for it to be valid, under section 61(2). Upon acceptance, the developer is committed to paying the levy before the development proceeds, and this payment is used to fund restoration efforts for sites and species affected by the development.

Section 62(1) specifies that where a development affects a protected feature of a European site or Ramsar site, the payment of the levy may be the only way for the developer to comply with the legislation. In other words, paying the NRL could replace the need for other consents or licences that would otherwise be required under the Habitats Regulations or the Wildlife and Countryside Act.

Further, section 63(1) grants the secretary of state the power to set rules and guidelines for determining the amount of the levy – taking into account the environmental impact of the development, and ensuring that the amount charged is financially feasible for developers.

Additionally – section 63(3) requires that the regulations specify the method for calculating the levy, which is to be proportional to the scale of the environmental impact caused by the development – ensuring that the charges are aligned with the ecological damage caused and considering the financial capacity of the developer.

Commercial impacts for developers and stakeholders

The NRL’s introduction brings financial and administrative considerations for developers. Paying the levy as set out in section 61(2) could obviate the need for other licences or consents, restructuring and potentially improving the efficiency of the approval process. However, for developers, particularly those working on large-scale projects near protected sites, this could represent a significant additional cost.

For landowners, the responsibility for the levy payment could vary based on their role in the development. Section 61(1) clarifies that developers requesting to pay the NRL must do so as part of an Environmental Development Plan, which may involve negotiations between developers and landowners about the apportionment of costs. Landowners with significant portions of protected areas on their land may face higher development fees, impacting the feasibility of some projects.

For local authorities, the NRL brings both administrative challenges and opportunities. Local authorities will need to ensure that the funds from the NRL are spent on approved conservation measures, under section 66(1). The authority will also play a role in monitoring the funds’ use, ensuring that the allocated money supports long-term biodiversity goals. 

Next steps for developers and stakeholders

The NRL, as outlined in sections 61-70 of the Planning and Infrastructure Bill, creates a mechanism by which developers are required to contribute to the restoration of biodiversity affected by development. Through clear provisions for the calculation and payment of the levy, the bill ensures that developers help fund essential conservation activities while reducing the administrative burden for both developers and regulatory bodies.

With the financial burden of the NRL outlined in section 63, and the strong enforcement measures established in the Planning and Infrastructure Bill for non-payment, developers and stakeholders must account for these obligations in their planning processes. Although this may increase the overall costs for developers, it also presents an opportunity to streamline environmental compliance and contribute to the UK's broader environmental goals.

For more information please contact our planning and infrastructure consenting team.