Having attended the Biodiversity Net Gain conference in London last Thursday, we felt it was important to follow up with an update on the main take away points and general thoughts of how BNG is going to play out over the coming months/years, and most importantly how we can assist in ensuring that clients are best advised in tackling BNG becoming a compulsory requirement of development proposals.
Firstly, what is BNG? In brief, it is a measured 10% minimum increase in biodiversity on development proposals, that will be mandatory and written into legislation, and is being introduced in stages over the coming months/years.
The baseline of biodiversity must be measured for sites initially (before development), for which there is a metric (produced by DEFRA/Government). Once the existing baseline is calculated for a site pre-development, there must be a 10% increase proposed with the development. The increase is measured in credits, again, calculated through the metric, which will define how many credits are required to be produced by the development proposal site.
BNG can be achieved in a numbers of ways and there is a hierarchy of preferences on how BNG is provided. Firstly, providing an uplift on site is most preferable, then off site (but in close proximity) or through the purchase of statutory credits (as a last resort). If it is not possible to provide the credits on site, there is essentially a market coming to fruition for the buying and selling of credits off-site. At the moment, there is huge variation in the value of credits dependant on demand and location, which will evolve further during the course of the coming years as this becomes a much larger market.
One of the take aways from last week’s conference is that if you can provide the BNG uplift on site, do so. Off-site credits can be expensive and whilst larger scale developments or those in more lucrative areas (London) may be able to stomach the cost of purchasing BNG credits, for small-scale developers it could be the cost that tips the viability scales when all other costs are also factored in (I.e. CIL, s.106 agreements and other statutory provisions). There is also possibility for development sites to create more BNG credits than required, and then sell these to sites unable to create credits. Again, this could alter viability of a development site in a positive manner.
One comment that was reiterated throughout the conference was that early engagement with the metric and BNG requirement within the development process would be key to prevent huge increases in cost. We can assist with this when providing initial site development appraisal by considering whether your proposal will be required to provide BNG (yes – there are some exemptions), and if so, providing advice on how you can take steps to do this.
Another area of consideration and in some instances, concern, was the ongoing management of BNG sites. Whilst there will be the initial implementation of BNG through planning permissions and conditions, many raise query over how the ongoing management will be monitored and enforced. The reason for this concern is that the minimum 30 year provision timeframe is significant and where sites are private, concern over monitoring the ongoing management are raised. Some optimism was had by those speaking, stating that the changing generations will self-regulate this as younger generations have more awareness and willingness to be accountable for impact on the climate. However, relying on those developing or living next to sites to be responsible is not enough.
Others suggested the enforcement process is another opportunity for enforcing BNG requirements. Comments to this suggestion were that this is a reactive process whereas BNG should be proactive. Also, given the constraints on councils at present in terms of staffing, the monitoring of BNG sites is also not going to be a priority to them until this is resolved. Therefore, the monitoring of maintenance of BNG sites is still up for debate and will likely become clearer over the coming years as sites begin to require the ongoing maintenance and people begin to challenge BNG sites that are mis-managed.
An interesting point raised was that where off-site BNG sites are coming to the ‘market’, these may be best placed where they are to be managed by farmers and land managers, and there is already an understanding of land management and what may be required in the long-term management of these sites. The consensus was that farmers are land managers well positioned for providing BNG sites and likely have better ability to guarantee ongoing management.
So, how does this impact developments and proposals? Depending on the type of development proposed, developers will now have to give careful consideration to biodiversity net gain and how they can look to ensure their sites are compliant with the requirements. It is worth noting, small scale development sites will not have to comply with BNG requirements until April 2024 (off the back of the Government consultation).
Ultimately, whilst BNG has been discussed and growing as a topic in the past few years, it is now clear that any developers must begin to engage with it seriously and factor it in to site appraisals, viability assessments and applications. If you have any questions on how this may impact your proposals, please do get in touch or book a 15 minute mini chat where we can assist you.