The rules for buying offsite units to comply with England’s biodiversity net gain (BNG) requirements aren’t clear enough for developers currently, with some local authorities better equipped to advise on the market than others, according to a sustainability consultancy working with large building clients.

Eight Versa, which works with clients including Barratt Developments and Balfour Beatty, said many of its projects are able to achieve the 10% biodiversity uplift onsite anyway, but where doing so isn’t possible, the route to sourcing BNG units offsite is unclear to developers.

“We’d always advise clients to try to reach the 10% requirement onsite first, which might require changing their design,” but where they aren’t able to, “the route to buying units isn’t always clear – you have to find a bespoke route,” Stacey Cougill, director and co-owner at Eight Versa, told Carbon Pulse.

Under the BNG rules, which came into force on Feb. 12, development projects in England need to achieve a net biodiversity improvement of at least 10%.

When on-site enhancements are insufficient to meet the target, developers can generate off-site gains elsewhere or purchase them in the fledgling BNG market.

However, demand has been slow to take off, with governance gaps and uncertainty about the scheme’s ability to meet demand among the main concerns.

Cougill said that challenging cases to achieve the 10% onsite gain include large sites where much of the land footprint is taken up by a building, such as industrial companies with large distribution centres, and housing development sites, where most of the land is taken up by new houses.

Green roofs can sometimes be used to prove biodiversity uplift, but that isn’t always possible, meaning that BNG units are required.

Eight Versa has yet to work on any projects where BNG units have been procured, however. The market is still being worked out and developers have to operate within the parameters of their local authority to source offsite units, she said.

“The BNG units you buy need to correspond with the habitat type that’s not living up to the 10% net gain standard,” Cougill explained.

The BNG framework is based solely on habitat calculations, as opposed to some other biodiversity methodologies that assess species too.

Within that, there’s three different parts – an area-based calculation for habitat, linear calculations for hedgerows, and linear calculations for water, such as rivers, streams, or canals, and each of those areas has to achieve 10% uplift, said Cougill.

So, for developments failing to achieve a 10% onsite improvement for hedgerows, they would have to procure the relevant BNG units to prove a 10% improvement for this habitat type elsewhere, she said.

Further, trading rules stipulate that the habitat being supported through the BNG units is of the same quality of what’s lost, so “you can’t lose really high-quality habitat and replace it with a lot of low-quality habitat”, which adds an extra layer of planning and organisation to what’s required, said Cougill.

LOCAL AUTHORITIES FIRST

When looking to purchase offsite units, developers will firstly speak with the local authority (LA) of the project site to see if there’s a local solution, as sometimes LAs have their own list of projects that you can purchase from or scheme you can get involved with.

However, some LAs are much better set up to cope with the new regulation than others, she said, echoing similar comments made by market participants.

Many LAs have lost their in-house capabilities in ecology and biodiversity over the last 10 years or so due to public sector cuts, meaning that many are now turning to ecologists in the private sector to supplement their knowledge, she said.

This lack of capacity in many LAs to draw up landowner section 106 agreement (S106) templates for BNG sites is holding up the market, according to law firm BDB Pitmans.

There seems to be good knowledge from developers around the requirements for BNG, but challenges persist around how to source offsite enhancements, as there’s “no set route” to follow and a huge amount of variation across local authorities in England, said Cougill.

She expects the market to increase in size as BNG is applicable to the majority of developments in England, though some exemptions exist and some developers are throttling demand for the market through submitting questionable exemptions, according to a lawyer at Environment Bank.

Certain development types can apply for exemptions to BNG. One of the key concerns for market actors has been ‘custom build’ exemptions – for sites of up to nine dwellings, on areas up to 0.5 hectares, built by individuals.

On Wednesday, the government updated its guidance on BNG custom build exemptions, including a link to previously published information and the legal definition.

However, the guidance places the responsibility of judging whether exemptions are valid on time-strapped LPAs, said the lawyer.

By Bryony Collins – bryony@carbon-pulse.com

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