Summary

The planning system has long sought to avoid the most severe adverse impacts on biodiversity, but it is unable to secure routine biodiversity improvement. 

The Environment Bill, which is going through Parliament at the moment, is set to change things.  In its current form, it will introduce a requirement to deliver at least 10% biodiversity net gain for new development in England.  This will have significant implications for developers. 

Biodiversity pre-commencement condition

Under the Environmental Bill in its current form, from two years after it comes into force, every planning permission granted for development in England will be deemed subject to a pre-commencement condition requiring the formal approval by the local planning authority of a “biodiversity gain plan” for the site.  

The local planning authority will only be able to approve the biodiversity gain plan if it thinks that the “biodiversity gain objective” is met.

The biodiversity gain objective

The biodiversity gain objective will be met if the “biodiversity value attributable to the development” exceeds the pre-development biodiversity value of the onsite habitat by at least 10%.

The scope of “biodiversity value attributable to the development” is wide, but controlled in key respects:   

• It can include habitat enhancement at the development site, but where works are involved in order to achieve this there must be a planning condition, planning obligation, or “conservation covenant” that ensures that such works will be maintained for at least 30 years after the development is completed.
• It can include habitat enhancement that is required to be carried out to a site other than the development site, but only where the enhancement is required under a planning condition or “conservation covenant”, recorded in a proposed new Defra biodiversity gain site register, and assured of being maintained for at least 30 years.
• It can include the biodiversity value of any “biodiversity credits” purchased for the development from Defra. These credits are generated by Defra from its own biodiversity improvement projects.  The cost of the credits will be set in a manner that ensures that it remains attractive for developers to organise their own qualifying biodiversity enhancements, either at the development site or elsewhere.  In other words, biodiversity credits will not come cheap.

Assessing the value of biodiversity – the biodiversity metric

The Bill proposes that the pre and post development biodiversity value of the development site, and any registered offsite biodiversity gains, are calculated by reference to the biodiversity metric. The biodiversity metric was developed by Defra and updated by Natural England in 2019. 

The metric assesses the biodiversity quality of a site based on the type, distinctiveness, condition, size, strategic significance and connectivity of its habitat.  It also assesses the difficulty of creating or restoring habitat (risk of failure), the time-based risk, and the risk associated with off-site works where biodiversity net gains cannot be fully delivered onsite.

The biodiversity metric is intended to provide a robust and consistent assessment.  Nevertheless, it should always be used with professional judgement.  This could lead to disputes as local planning authorities could challenge developers’ assessments and require further assessments by their own ecologists. 

The biodiversity metric may not be suitable for certain types of assets in relation to which  the use of a bespoke metric might be more appropriate.  Indeed, several organisations are preparing their own metrics.  This approach is suitable if Natural England approves the use of an alternative metric and the relevant planning condition or section 106 obligation do not expressly require the use of Natural England’s metric. 

Protecting pre-development biodiversity levels

The Environment Bill deals with the possibility that landowners or developers may damage habitats on sites earmarked for future development in order to reduce their pre-development biodiversity value and make it easier to achieve a 10% improvement.  Damage to habitats as a result of activities after 30 January 2020 will not be taken into account, unless in accordance with a planning permission or other consent/permission (to be specified in future regulations). 

Conservation covenants

As indicated above, one of the ways in which a developer can demonstrate that the biodiversity gains in its biodiversity gain plan are assured is by ensuring that conservation covenants to ensure that something is done, or not done, on the relevant land are entered into. 

Conservation covenants are a new concept, proposed for the first time in the Environment Bill.  They are agreements between a landowner and a responsible body (to be designated by the Secretary of State).  Registered as a local land charge, those legally binding agreements will run with the land. 

They can be for a finite period, but the freehold default position is that conservation covenants bind the land in perpetuity.  Therefore, land subject to a conservation covenant could be considered sterilised for future development.  Landowners can be released from conservation covenant obligations after parting with their interest in the land.  However, the successor will step into the landowner’s shoes. 

Exemptions

In addition to exempted development for which planning permission is granted by a development order or urgent Crown development, the following types of developments are excluded from the new requirements:

• nationally significant infrastructure projects (NSIPs);
• marine development;
• brownfield sites which do not contain priority habitats and face genuine viability issues; and
• permitted development and householder applications.

Concluding thoughts

If the proposals in the Environment Bill are implemented in their current form, much will change.

Ecologists will need to be appointed early to navigate the biodiversity metric and consider and prepare the biodiversity gain plan.

Developers will need to carefully consider the logistics of delivering enhancements.  How will they “keep it up” for at least 30 years? If enhancements are to be delivered on third party land,  how will third parties be persuaded to enter into conservation covenants, with all of the restrictions that these may entail? 

Developers will also need to remember that future development of sites subject to conservation covenants will be more onerous.  This is because the pre-development biodiversity value will include the biodiversity improvements that are already “locked in” by the conservation covenant.