Biodiversity net gain requirements for residential development

The Environment Act 2021 provides a new domestic framework for environmental governance and makes provision on specific environmental policy areas including biodiversity. Part 6 of the Act provides for the creation of a new biodiversity net gain requirement (in England) of 10% for developers to be a condition of planning permission. Biodiversity off-setting forms part of the package of measures introduced to help attain the Government’s long-term objective ‘to be the first generation to leave the environment in a better state than that in which we inherited it.’

The government consultation on how statutory requirements will work in practice has been published this week. The consultation is open until 5 April 2022. It is proposed that the biodiversity net gain requirements will come into effect in November 2023.

The consultation document sets out proposed exemptions including developments that have a ‘de minimis’ impact on habitat, householder applications and change of use applications and the creation of biodiversity net gain sites, however, the widely anticipated exemption for brownfield sites is not proposed.

For small sites (between one and nine dwellings inclusive on a site of less than one hectare, or where the number of dwellings to be provided is not known, a site area of less than 0.5 hectares).

For larger sites, the government is proposing a phased approach to the off-setting requirements. The consultation recognises that variations to permissions under section 96A or s73 will not require additional offsetting, except where the variations proposed affect the biodiversity value. In these circumstances, the same baseline as applied to the original development will be used. This approach should avoid the type of double counting problems that arose in the early years of CIL.

The consultation proposes that the 10% net gain requirement can be met by on site enhancement, offsite biodiversity gain, including the purchase of biodiversity ‘units’ from a site registered on the proposed ‘biodiversity gain site register’. Habitat created or enhanced after 30 January 2020 will be eligible for registration and sale of the associated biodiversity gains, provided it meets the criteria for registration as set out in the consultation document. The government will encourage habitat banking to allow enhancements to be delivered before development takes place.

For all sites there will be a new requirement to submit, a ‘biodiversity gain plan’ containing certain core information:

•  The pre-development biodiversity value;
•  Steps taken to minimise adverse biodiversity impacts;
•  The proposed approach to enhancing biodiversity on-site, and
•  Any proposed off-site biodiversity enhancements (including the use of credits) that have been planned or arranged for the development.

Permission will then be granted subject to a condition or s106 obligation to submit and gain approval prior to commencement and subject to a requirement that it will be maintained for at least 30 years after the development is completed. Such a plan should be approved when the LPA is satisfied that:

• the biodiversity gain plan and completed biodiversity metric (submitted as the completed calculator document, not a ‘snapshot’ or summary) show a measurable net gain of at least 10% across all unit types (area-based, and where relevant, linear, and riverine habitats), having regard to policy on matters such as additionality;
• the information, including pre-development and post-development biodiversity values, presented in the biodiversity gain plan is complete and meets the statutory requirements, and
• any claimed gains (both on-site and off-site) are appropriately secured and allocated, including the point in the development process that these gains are to be delivered and a proportionate description of how enhancements will be managed and monitored.

On-site biodiversity gains should be secured for delivery within 12 months of the development being commenced or, where not possible, before occupation. Off-site works to commence as soon as is feasible and no more than 12 months after the discharge of the mandatory pre-commencement biodiversity net gain condition/s106 obligation.

The consultation document makes it clear that it is the intention to allow higher percentage targets to be set by planning authorities at a local or site level. Any higher target should be made clear at an early stage in the planning or development process and careful consideration should be given to the feasibility and achievability of any requirements above 10%, which can have significant impacts on the costs of developing a site.

The requirement to provide biodiversity net gain (whether the 10% or any greater percentage set at a local level) will inevitably increase the cost of development and in many cases will have an adverse effect on the viability of the proposed development. Whilst it is recognised that the environmental impact of development needs to be addressed, requiring a developments to foot the bill in its entirety will have wider adverse impacts. As the mandatory cost of development rises, the submission of viability assessments as part of the planning process are likely to increase. The most likely outcome of which will be a reduction in the number of affordable housing units that it will be viable to provide or fund as part of a development.