Biodiversity net gain on new developments has been emerging in planning policy for a while, but in February this year, a requirement to secure a 10% increase in biodiversity value against the pre-development value became law for new planning applications. It has the potential to change the landscape literally and figuratively
It’s an important shift for protecting and enhancing the environment and removes an element of flexibility which planning policy allowed.
There is, of course, still a trade-off between protecting natural capital and ensuring development viability. There is a cost to complying with biodiversity net gain requirements, that will either be passed on to consumers, or result in other items of infrastructure receiving less funding. However, there are opportunities to work with the law and think creatively about new development while delivering attractive and sustainable schemes.
Focus on brownfield sites?
A 10% biodiversity net gain requirement applies to most forms of new development but how onerous that is in practice will depend on the land’s existing biodiversity score.
Sites which already have a good biodiversity score will be harder to improve than poor-quality land with a low score.
“10% of a low number is smaller than 10% of a big number,” says Rory Stracey, Partner, Trowers & Hamlins
“If you have a site with zero biodiversity by value, for example, if it has an entirely sealed surface, then you wouldn’t have to deliver any biodiversity net gain.”
This potentially makes brownfield sites a little more attractive to developers and
housebuilders but also creates an opportunity to deliver additional value.
Biodiversity net gain is potentially a good news story for housebuilders and can
become a positive talking point.
“If you’re promoting a new housing scheme, and perhaps there’s some concern
about building over or harming the natural environment in some way, you can show how biodiversity will be improved on what was already there,” says Stracey.
Having visible features like bat and bird boxes can add to the appeal of a
development as residents can easily see how their homes are supporting nature.
Increasingly people buying new houses or taking new commercial space look for
developments that can demonstrate strong environmental credentials.
Practical features can also have a dual purpose.
“I’ve seen attenuation ponds used for flood risk management double as a wetland area which can then support particularly diverse flora and fauna,” says Amanda Stubbs, Partner, Trowers & Hamlins.
Biodiversity net gain credits
Where it is possible to enhance biodiversity above the stipulated 10%, taking this approach can be beneficial in two ways.
There is a hierarchy for biodiversity net gain provision, with enhancements onsite being the preferred option, followed by off-site and then statutory credits being the least valued, but potentially the most expensive to deliver, because a sum of money must be paid to Natural England in lieu of providing a 10% net gain on site.
Local authorities have some power to enforce that hierarchy, but going beyond the statutory minimum of 10% can be used as material consideration in favour of the development.
“A developer could decide to put forward an enhanced biodiversity offer above
the 10% mandatory requirement as a material planning consideration weighing
in favour of the planning application, or they could decide to bank the additional
biodiversity net gain by storing it as a credit to potentially offset against other
nearby developments,” says Stracey.
This credit could be for a developer’s own use or sold on to other developers.
The creation of a biodiversity net gain market or ‘habitat bank’, as a result of the
legislation, is in its infancy. However, it could add value for landowners while still
taking a responsible approach to protecting and creating natural capital.
“Local authorities are looking at how they’re going to respond to habitat banks to ensure that the credits are robustly secured from a legal perspective – enforceability is a potential concern” says Stracey.
Potential source of income
Biodiversity net gain is also a potential source of income for local authorities and
estate owners where there may be capacity to make enhancements. A review of
existing assets is a worthwhile strategy.
For developers and housebuilders with sites where delivering 10% biodiversity net gain is very difficult, buying credits (either statutory credits or from habitat banks) may be the only option, but there is a downside to this.
“Statutory credits will be a more expensive option, and it’s money just being paid
out to central government without any of the direct local benefits of onsite natural
enhancement, whereas habitat bank credits will be cheaper and bring tangible
local habitat benefits” says Stubbs.
Land use is also increasingly competitive, particularly in urban areas, with the
temptation to view existing green spaces such as parks as an opportunity for
rewilding and other biodiversity enhancements.
But where do the users of that park go, those exercising, playing ball games or
walking a dog?
“A jogger can’t run in a wetlands area,” says Stubbs. “Planning authorities will have to balance these competing uses for green space.”
It’s a similar trade-off with onsite biodiversity enhancements at new housing
developments. Wildflower meadows and habitats for ground-nesting birds don’t
necessarily sit comfortably alongside children playing games and dogs running
around.
Maintenance and management of these natural habitats have to be planned so they thrive, which is an additional cost.
Here is where having off-site provision of biodiversity net gain may be an
advantage as the land is managed by someone else, usually a professional outfit such as a habitat bank provider or ecologist set up specifically to manage the offsite habitat.
As available land gets used, it will take a more creative approach to deliver the 10% net gain. Green walls and roofs are becoming more common in some cities.
“I’ve seen a single-story development with goats grazing on the roof. It may be a
gimmick, but it’s green land that is being utilised,” says Stubbs.
“One of the great things about new legislation is the creative thinking that it engenders. Preservation of natural capital for future generations – whether flora and fauna, water resources or clean air – is now under the spotlight, but I’m confident that the property industry will rise to the challenge that this presents.”
Download to read the rest of the responsible business newsletter here.
