Bio-diversity net gain refers to the concept of leaving the natural environment in a better state than before a development in a manner that provides lasting benefits. This concept is being brought into planning law by means of amendments to the Town & Country Planning Act and will become mandatory by 2023, though it has already been voluntarily adopted by many local authorities.
Although the responsibility for delivering bio-diversity net gains rests with developers, this does bring opportunities for landowners.
There are two options available to developers: either habitat creation or habitat enhancements. Both options will involve a mix of planting/managing woodland, creating/maintaining wildflower meadows and creation of wetlands. Whichever option and method is chosen, the habitat must be secured for a minimum of 30 years and will be registered on Natural England’s website with all agreements recorded to ensure no area is used twice.
Once a site has been chosen for development, an assessment of the current site is undertaken using standard metrics set out by Defra. This will be used to document how bio-diverse the site currently is. From this baseline the developer will have to add back what will be destroyed by the construction but also add an additional 10% of ‘bio-diversity units’. The end goal of this is to improve the surrounding area. The uplift should aim to be on the site itself, but where this is not possible local land may be used, as long as it falls within the same local authority.
This creates an opportunity for landowners to sell or lease unproductive (and potentially unprofitable) areas of land to developers for them to use in meeting their BNG goals. Furthermore, should land be leased to a developer and a woodland is created, the landowner may also be eligible to sell carbon credits on this newly created woodland to another party, adding a further revenue stream.
However, landowners must be aware that should they lease the land to a developer this land will be tied up for at least 30 years and the covenants are binding, so should the land be sold this will still need to be upheld. Landowners must also be aware of the implications of the change in use of land, potentially affecting the availability of inheritance tax reliefs. Once the 30 years has run its course, it may also be a challenge to return the land back to its original use as it may have become an ecological area of great significance. With these factors in mind, long-term planning is required when any decision is being made.