Biodiversity Net Gain (BNG) is not just a technical requirement but a policy shift with far-reaching implications for how development is conceived, approved, and delivered. Before exploring the details of what BNG entails, it is important to understand the legal framework that underpins it and the responsibilities it creates for different stakeholders.
Introduction to BNG, the legal mechanisms and requirements for developers
With the mandatory Biodiversity Net Gain (BNG) requirement now in effect under the Environment Act 2021, developers, landowners and local planning authorities face new legal obligations and commercial opportunities.
What is Biodiversity Net Gain?
Biodiversity Net Gain is a planning principle whereby development must leave the natural environment in a better state than before. Under the current framework:
- Most development projects in England must deliver a minimum of 10% biodiversity net gain.
- This must be maintained for at least 30 years.
BNG has recently become a legal requirement and is an evolving concept. Instead of just mitigating the negative impacts on nature caused by development, BNG seeks to enhance the natural environment beyond its pre-development state. This concept is part of a broader shift toward sustainability in the construction, planning, and development sectors.
Legal Mechanisms: Section 106 Agreements and Conservation Covenants
Section 106 Agreements
Section 106 Agreements are planning obligations which can be used to secure on-site or off-site BNG. They are legally binding agreements between the landowner/developer and the local planning authority and are often preferred for their flexibility and familiarity.
The Section 106 Agreement can require developers to deliver biodiversity enhancements either on-site or off-site. These obligations will include maintenance, monitoring, and reporting for the 30-year period.
However, there are limitations – Section 106 Agreements are only enforceable by the local authority and not by third parties (e.g. conservation bodies).
Section 106 Agreements can be used by habitat banks or landowners wishing to sell biodiversity credits, as well as developers providing BNG for their own developments.
Conservation Covenants
Introduced by the Environment Act 2021, Conservation Covenants are a new legal tool that can run with the land, binding future owners.
They are private, voluntary agreements between a landowner and a responsible body (usually a conservation charity or public body).
Like Section 106 Agreements, Conservation Covenants can be useful for habitat banks or landowners wishing to sell biodiversity credits. They may not be so helpful for smaller developments providing off-site BNG, due to the costs involved of a responsible body.
Considerations for Developers
BNG introduces both a legal obligation and a strategic consideration in development planning. Developers must demonstrate how BNG will be delivered and maintained for 30 years. Failing to comply can result in planning refusal or enforcement action.
Developers will therefore need to consider early engagement with ecologists and legal advisers to avoid BNG holding planning applications up.
On-site delivery is often cheaper but may not always be feasible.
If a developer is unable to achieve the required level of BNG within the development site (or on off-site land owned by the developer), credits may be purchased from habitat banks. A habitat bank will have a Section 106 Agreement or Conservation Covenant already set up and registered on the BNG register. Alternatively, developers can look to purchase credits from the Government’s statutory biodiversity credit scheme as a last resort, though these are typically more expensive.
In our next blog on this topic (Part 2), we consider the key considerations for landowners and the opportunities that this new requirement presents to them.
If you would like tailored advice on how the Biodiversity Net Gain (BNG) requirements may affect your development project, please get in touch with our solicitor Emma Ship. We can guide you through the legal mechanisms, help ensure compliance, and highlight opportunities that BNG may present for your business.
Related reading
If you’re interested in how Biodiversity Net Gain is shaping opportunities for farmers and landowners, our colleagues have written more on this in their blog: Biodiversity Net Gain: The key to sustainable farming.
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