10% biodiversity net gain: Planning requirements for new homes [2023 Update]

In 2021, the news came in that every development proposal in the UK – no matter how big or small, and no matter what the current state of the plot is – would soon have to demonstrate a measurable increase in the biodiversity fostered on site.

The requirement is enforced by the 2021 Environment Act, which introduced an automatic new condition to every planning permission granted: a biodiversity net gain (BNG) of 10%.

This means that, before any development begins, applicants need to measure the existing and proposed biodiversity values of their sites. They also need to set a clear plan for the proposed increase, and get that plan approved by their local authority.

The legislation raises many questions for anyone even just thinking about embarking on a building project, let alone anyone whose proposals are more complex.

Is this really true? Are there exceptions? (Yes, crucially, there are – we will explain which applications won't have to meet these requirements.)

What does biodiversity mean in this context?

How is biodiversity measured and whose responsibility is it to measure it?

How much is this going to cost you?

And over what time period will the council be monitoring that net gain?

We can’t answer all of these questions right now but in this article, we’ll do our best to explain what is going on and what it will mean.

The first thing to say is that, although the 2021 Environment Act is now law, the biodiversity net gain (BNG) requirement will be phased in between November 2023 and April 2024.

The grace period doesn’t mean that you can ignore biodiversity – as we will explain, many councils are already expecting applications to demonstrate some improvement on this front, and as we get closer to the introduction of the new rules, many more will follow. But it does mean that as we write in early 2023, you still have a little time to develop an understanding of the requirement before it becomes standard practice.

So it is useful to get to the work of understanding biodiversity net gain (BNG) now. We’ll take a look at what you need to prove, how to prove it, and how much that will cost.

The Local Government Association defines biodiversity net gain (BNG) as an approach to development or land management that aims to leave the natural environment in a better state than it was beforehand. In planning policy, an important element of biodiversity net gain (BNG) is the fact that it is measurable.

As we’ve said, the 2021 Environment Act explicitly makes biodiversity net gain (BNG) a condition of planning permission, requiring all developers to demonstrate how they will deliver a 10% improvement to the biodiversity value of any application site. We’ll look into the tool for assessing these values in a bit.

Local planning authorities across the country are recognizing the importance of incorporating BNG in their adopted and emerging local plans. By March 2023, 40% of councils had BNG policies in their current or emerging local plans, a substantial rise from 28% the year before.  

And many councils have introduced policies that go above and beyond the upcoming 10% requirement. Fourteen councils have introduced a BNG of 20 percent increase on some or all new development projects. 

But first, and more broadly, what is biodiversity?

The term refers to the variety of living species on Earth, including plants, animals, bacteria and fungi. Both natural and built habitats contribute to biodiversity, which makes human life possible and allows economic industries to function.

Public agencies like Natural England have long campaigned for more robust and consistent policy around biodiversity net gain (BNG). Back in 2018, for instance, they advocated making biodiversity net gain (BNG) requirements increasingly common in local plans.

There are many reasons behind this push. Obvious is the looming threat of climate change, especially following the UK’s hosting of COP26 in Glasgow in 2021. But the specific political context that we’re in matters too.

As charities like ClientEarth have pointed out, the UK’s departure from the EU left gaps in our national legislation around environmental protection. The 2021 Environment Bill sought to address this by setting clear targets for air quality, biodiversity, water and waste management and the reversal of species decline.

A major item on the Environment Bill’s agenda is a reduction target on concentrations of particulate matter (PM2.5), the most harmful pollutant to human health. Moreover, while unsafe levels of PM2.5 affect all of us, we know that there’s also an important social justice element to the conversation.

In 2020, a landmark court ruling by the London Inner South Coroner’s Court found air pollution to be the cause of death of nine-year-old Ella Roberta Adoo Kissi-Debrah, who lived in the London Borough of Lewisham. Throughout her life, particulate matter concentrations in Lewisham exceeded WHO guidelines, EU limits and national levels.

Underlying health conditions made Kissi-Debrah more susceptible to the effects of toxins in the air, but her case also highlighted that air pollution levels tend to be more concentrated in less advantaged areas. Among other factors, this is caused by their geographic proximity to industrial activity and busy thoroughfares.

The ruling has since served as a clarion call for environmental justice advocates and organisations like Impact on Urban Health, whose work addresses the uneven impact of environmental health risks across London.

So, we know that biodiversity net gain (BNG) and the logic behind it are important – especially when it comes to climate action, population health and broader social well-being. The preservation of biodiversity accomplishes other goals on the environmental agenda by contributing to air quality standards and preventing species decline.

Although the development industry is often positioned at odds with the climate crisis, the planning system can and should play a critical role in solving it.

Alongside the provision of strong ecological protections through designations like areas of outstanding natural beauty and special scientific interest, current planning policy encourages biodiversity improvements where possible on a local and national scale.

Natural England, therefore, stresses that the biodiversity net gain (BNG) requirement can benefit developers too. If an effective biodiversity net gain (BNG) plan is incorporated into a development proposal early on, the project will be less likely to receive objections on the grounds of nature conservation or ecological harm.

In crafting any compelling planning application, it’s critical to demonstrate industry knowledge and a willingness to play by the rules. Part of this is having a grasp on predictive trends in legislation.

For example, we recently worked on a project for which we knew that an Article 4 Direction (preventing conversions under permitted development) was pending. Even though the policy wasn’t in place yet, our awareness of what the council wanted to see on-site in the future allowed us to craft a compelling application now.

This is exactly how we intend to approach the biodiversity net gain (BNG) requirement and the bulk of new environmental legislation moving forward. Now let’s take a look at what the policy really demands.

The new general condition applies to all planning permissions granted in England – of course, with a few significant exceptions. We’ll get into these in a bit.

But first, how does the condition actually operate?

Upon the granting of planning approval, the planning condition requires that a biodiversity gain plan be submitted – and approved – by the relevant local planning authority before any development can lawfully begin. The biodiversity gain plan must assess the value of natural habitats on-site before development and after development, and ensure that at least a 10% net gain is achieved between the values.

We should note that you can resolve the requirement before the condition stage by including the net diversity plan in your planning application.

The act also makes clear that the biodiversity gain plan should address how adverse impacts on habitats have been minimised. After avoiding harm, biodiversity improvements can be delivered through habitat creation or enhancement.

Moreover, the legislation states that the onsite biodiversity increases can only be considered part of the post-development biodiversity value if they will be maintained for at least 30 years following the completion of the development. At this point, though, it’s still unclear how the council will be monitoring that maintenance in practice.

As with the demands of transportation and fire safety requirements, we recommend appointing a specialist consultant to advise and craft your biodiversity gain plan, given the complex requirements around habitat quality as well as the 30-year maintenance timeline. The cost of this will vary depending on the size and intensity of the development site, but is likely to start at around £450 and up.

Your consultant will use the DEFRA biodiversity metric to calculate the relative biodiversity value of any habitat. Measured in terms of “biodiversity units,” the metric is a document made explicitly for this purpose, produced and published by the Secretary of State.

Recent guidance from DEFRA states that the creation/recreation of new habitats can contribute towards your necessary biodiversity net gain; however, this cannot constitute the entirety of the net gain. Rather, DEFRA recommends using habitat creation/recreation to offset development to gain biodiversity net zero and use other techniques to create gain.

It’s important to note that there are a few ways to meet the requirement, not all of which need to be accomplished on-site. If the local planning authority agrees, developers can also pursue off-site compensation.

This might involve contributing to a biodiversity register or purchasing biodiversity credits. Where off-site repayment is approved, the DEFRA metric will be used to calculate how many “biodiversity units” a developer will need to pay for in order to offset their biodiversity loss.

While we can’t yet see what the exact standards for biodiversity improvement will be, we know that a few general principles will apply.

First, years of government policy on biodiversity have set guidance for something called habitat distinctiveness, which refers to the richness, diversity and rarity of species on site, along with the degree to which a habitat uniquely supports species – meaning that they are scarcely found in habitats of a different kind.

So, where habitat replacement is proposed as a means of delivering biodiversity net gain (BNG), we can deduce that this replacement should be done with a habitat of higher distinctiveness. Already in Leeds, for example, replacement must be “like for like or a realistic increase of one step upwards.” This clarifies that a low-distinctiveness habitat can be replaced with a medium-distinctiveness habitat, but not with a high-distinctiveness one.

Furthermore, we should note that the provision of any new high-distinctiveness habitat will only be acceptable if the land is transferred to a specialist nature conservation body, or if long-term management will be delivered by an accredited ecologist. Promoting high distinctiveness should therefore not always be the goal, as the work required is not appropriate for most project scales.

But for all development proposals, regardless of the site’s size or distinctiveness level, the input of an ecology consultant should be encouraged at the design stage. The consultant’s feedback will help applicants demonstrate that consideration has been made of all possible high-quality biodiversity enhancements on-site.

And where the 10% net gain cannot be achieved on-site, it should be noted that, if the proposed design is developed alongside the input of an ecology consultant, there is even a chance that the expectation for off-site contributions could be lowered.

The legislation provides us with a framework for understanding what will be required of all planning applications by the time the 2021 Environment Act comes into force. What it doesn’t do is lay out specific ways to deliver biodiversity improvements, such as through the introduction of new species.

We are left feeling that, for urban areas in particular, the majority of applications are going to require off-site contributions – especially if private gardens and green roofs on private buildings don’t count.

The policy outlines what can be counted towards “registered offside biodiversity gain,” which refers to biodiversity net gain (BNG) that is achieved on land other than the development site. Whether developers make an agreement with a third party to accomplish this, or decide to facilitate this themselves, the gain can be counted toward the 10% requirement as long as it is recorded on the biodiversity gains site register.

Natural England is developing a publicly available site register that will include information about any site being used to deliver biodiversity net gain (BNG). It aims to identify site ownership, linking these sites to the individual development whose biodiversity net gain (BNG) requirements they are helping to meet.

In doing so, the register seeks to minimise the risk of applicants ‘gaming’ the biodiversity net gain (BNG) system, ensuring that the same parcel of land is not claimed as the means for delivering biodiversity net gain (BNG) by multiple proposals.

And conversely, when it comes to biodiversity credits, here’s what we know. In order to prove that they are a compelling way to address biodiversity loss, developers must be able to show that the ‘mitigation hierarchy’ (NPPF Paragraph 175) has been adhered to, and that they are still incapable of addressing biodiversity loss on-site or through a local contribution.

A specialist consultant can advise on the best strategy for meeting the requirement, given the nature of nearby sites along with the local authority’s priorities.

August 2023 update: the price of credits has been released by DEFRA and it has been set extremely high, with the idea of making clear that they should be used as a last resort only. Planning Resource reports that credits for a one-hectare development could run well into the hundreds of thousands.

It’s important to note that the following cases are exempt from the Biodiversity Net Gain (BNG) requirement:

To the confusion of many, it took until February 2023 and the response to a consultation on how the net gain should work for the government to confirm that householder applications would be exempted. It always seemed like the most logical outcome, but for some reason, it was not established from the start.

However, the government has also made clear that with some of these exceptions – such as householder and self-build applications – it still wants to see improvements in biodiversity, usually imposed through planning conditions.

For smaller sites, it could be that local authorities could accept a lower net gain requirement if the development does not cause habitat loss. The integration of green infrastructure, for example, or bat and bird nesting features, could instead be encouraged.

More broadly, we will be keen to discover how the legislation actually achieves the goals that it sets out. If most action ends up being offsite, could we end up with the same troubles as carbon offsetting presents, like the mass planting of the wrong trees in the wrong places?

The first version of this article was written in January 2022 – we updating it as more information becomes available.

In February 2023, we got more clarity about the timing of the introduction of biodiversity net gain into the planning system. In its Environmental Improvement Plan 2023, the government committed itself to:

"Implement mandatory biodiversity net gain from November 2023 for most developments in England so new developments create 10% more biodiversity."

You might have spotted the word 'most' in there. In order to help councils with the transition, smaller sites will only need to demonstrate the 10% BNG from April 2024. What are smaller sites in this context?

(i) For residential: where the number of dwellings to be provided is between one and nine inclusive on a site having an area 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.

(ii) For non-residential: where the floor space to be created is less than 1,000 square metres OR where the site area is less than one hectare.

Our view is that anyone expecting to be able to sneak under the wire by getting a large planning application submitted in the next few months to beat the deadline could well be disappointed. There are already councils that have BNG policies that go well beyond 10%, and others will be expecting at least some kind of commitment towards biodiversity. It's true that there might be some overstretched and under-resourced authorities willing to wave through applications before the complexities of BNB +10% are fully introduced, but we think those will be the exceptions.

Do check back here in the coming months, as we will continue to add to this article up to and during the implementation of the policy.