Developers and environmental requirements - update

Biodiversity Net Gain (BNG) has been at the forefront of developers’ minds for many months, with requirements expected to become a mandatory element of the planning system in England from next month.

However, last week the government announced a delay. This, coupled with debates about nutrient neutrality, and the prime minister’s scaling back of net zero commitments, could result in a reduced focus on the natural world. So what do developers need to know about BNG and nutrient neutrality, and the timeframe for changes?

Biodiversity Net Gain (BNG)

Developers can now expect to be required to deliver 10% BNG from January 2024 onwards when building new housing, industrial or commercial developments (unless they are ‘small sites’ – see below). The rationale behind BNG is that developers must make a positive impact on the local environment, leaving it in a better state than prior to the development. This could be by creating green spaces, for example. Where 10% BNG cannot be achieved on site, it may be possible for a developer to meet the biodiversity gain objective by the provision of offsite biodiversity gains and biodiversity credits.

The timetable for small sites remains the same, coming into force in April 2024. For residential development, a small site will have fewer than 10 dwellings on land of less than one hectare in size, or, if the number of dwellings is not known, where the site has an area of less than 0.5 hectares. For non-residential development, the floor space to be created must be less than 1,000 square metres, or have a site area of less than one hectare. There are, however, certain circumstances in which the small site metric will not apply. For example, if there are priority habitats within the development site.

BNG for Nationally Significant Infrastructure Projects will still apply from 2025.

The government has committed to publishing all guidance and regulations by the end of November. This will include:

• ‘the statutory biodiversity metric, critical for calculating the correct biodiversity gain
• the draft biodiversity gain plan template, which will help developers prepare for what they will need to complete during the planning application stages
• the Habitat Management and Monitoring Plan template, which will set out how the improved significant on-site and off-site habitats will be managed for the long term
• a package of Biodiversity Net Gain guidance that sets out further advice for landowners, developers, and Local Planning Authorities around their role and responsibilities in delivering mandatory Biodiversity Net Gain’

Nutrient neutrality

There has been some concern about the impact that nutrient neutrality requirements have on housing delivery. The government’s view is that ‘defective EU laws’ on nutrient neutrality ‘are blocking the delivery of new homes, including cases where planning permission has already been granted.’ The government had included amendments to the Levelling-up and Regeneration Bill (LURB) to reform the current system, but these amendments were vetoed by the House of Lords so are no longer included in the LURB.

The government website sets out that:

‘Nutrient neutrality, the delays it is causing to housing delivery, and the wider need to restore our waterways remains a government priority, and the government will make further announcement about next steps in due course.

In the near term, it is important that planning decision-making continues in the areas affected on the basis of the current legal framework – meaning that where mitigation is available, local authorities and developers should seek to progress sites. Natural England will continue to deliver the existing Nutrient Mitigation Scheme in line with the Environment Secretary’s direction of 28 July 2022. Further details about plans for government’s support for mitigation schemes led by local authorities and private organisations, including next steps on the DLUHC’s Local Nutrient Mitigation Fund will be set out shortly.

The new duty on water companies to upgrade wastewater treatment works in designated areas by 2030 – and the requirement for developers and local authorities to consider these as certain for the purposes of an assessment under the Habitats Regulations – remain in the Levelling Up and Regeneration Bill. These will significantly reduce the average costs of nutrient mitigation when designations are made, and a list of treatment works to be upgraded will be published within 3 months of Royal Assent. The House of Lords also accepted several additional government amendments which seek to provide a greater level of flexibility in how water companies reduce nutrient pollution across affected catchments, with the aim of maximising benefits for the environment while minimising costs on water bill payers.’

Whilst it is clear that housing delivery is a priority, this needs to be balanced with environmental concerns. The LURB is still making its way through Parliament, but we understand that the government is aiming for Royal Asset before the King’s Speech on 7 November 2023. We will continue to monitor and update on developments.

Katherine Evans said that “the Government has finally recognised that it was not going to meet the November deadline for the statutory provision of 10% BNG on development sites. However, that doesn’t prevent local planning authorities from demanding BNG on development sites as the NPPF still refers to it and some local authorities have adopted policies in the development plans (sometimes for more than 10% BNG) that they will still expect developers to comply with. So, there is still a high level of uncertainty which alongside the continued difficulties over nutrient neutrality, makes development a challenging activity especially for those trying to develop smaller sites where on-site mitigation is impossible.”

TLT has extensive experience in advising on planning issues. If you would like to discuss your requirements, please get in touch.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at October 2023. Specific advice should be sought for specific cases. For more information see our terms & conditions.