Shropshire Farming Talk: Biodiversity net gain

The principle was enshrined in law in The Environment Act 2021, which obliges developers to deliver at least 10 per cent biodiversity net gain (BNG) for residential, commercial and industrial developments.

As a result, I'd like to outline five more things for biodiversity net gain, a key market within the lowland nature based solutions sector.

1. Stacking and bundling

Land managers can sell both biodiversity units and nutrient credits from the same intervention, such as the creation of a wetland or woodland. Environmental grants, such as Environmental Land Management, can also be uplifted to provide BNG, provided it is clear what the original grant funding is for.

For example, if you created a modified grassland for a grant payment, you could then take a baseline from this and improve the habitat condition beyond the requirements of the grant to create biodiversity units for sale into the BNG market.

2. Above 10 percent

Locality is key as a number of local planning authorities are planning to exceed the statutory minimum of 10 per cent through their local plans. Many also introduce priority areas for biodiversity delivery. These two factors have a significant effect on local supply and demand.

3. Biodiversity gain site register

Natural England will function as the operator of the mandatory biodiversity gain site register, to record allocations of off-site units and make the information publicly available, but it will not act as a marketplace.

Six weeks is expected to be the timeframe for application determination. Savills is operating an environment exchange: a publicly available platform which matches available nature-based solutions with third parties that need them.

The exchange enables landowners with natural capital assets to market them to third parties who use the platform to identify geographically specific nature-based solutions to fulfil their requirements.

4. Statutory biodiversity credits

Natural England will sell statutory biodiversity credits but only on a temporary basis with the intention to phase out their availability once the market has matured. The indicative statutory biodiversity credit was published in July starting at £42,000 per unit and rising to £650,000 for lakes.

Developers needing to resort to the statutory bank of BNG credits will be required to buy two BNG credits for each unit needed.

5. Habitat banking

Habitats created after January 30, 2020 will be eligible for registration and sale of units. Any enhancements before this date are not eligible, and will need to be re-baselined to allow for sales.

There will not be a time limit on how long units can be banked before they are allocated. The habitat bank can effectively be split dependent on how many are needed for each development, with separate 30-year agreements for separate developers.

By Will Davies, a food and farming consultant at Savills in Telford