BNG offers new opportunities for landowners, land managers and developers

The new planning requirement for developments in England to result in a 10% biodiversity uplift offers rural landowners novel opportunities to generate diversified income streams from their land.

Biodiversity Net Gain (BNG), which will now apply to the vast majority of development sites in England, is according to Defra, ‘intended to ensure that developers leave the natural environment in a measurably better state than it was before development’.

This steer towards BNG fits into the Government’s target of repositioning the environment as a core consideration in the planning process and beyond, joining other initiatives such as the Environmental Improvement Plan and the Nature Recovery Network.

The framework established under BNG sets out opportunities for landowners and land managers to sell uplift of habitats on their land to developers who cannot meet their BNG obligations within their site.

Biodiversity value of land and habitat uplift committed to BNG offsetting is calculated by an ecologist or similar professional using Defra’s Statutory Biodiversity Metric, which considers the baseline and context of existing habitats and planned enhancement. This metric generates the potential BNG uplift value that can be achieved and sold on the open market.

With the Government estimating that 300,000 new homes should be built every year to help solve the housing crisis, and large-scale projects such as the commitment to build 150,000 houses in Greater Cambridge announced by the Government, the potential for growth in the BNG market over the next few years is significant.

As of March 2024, BNG units are commercially trading for between £25,000-£45,000, with it being possible to produce upwards of 10 units per hectare on allocated land.

Further guidance, best practice standards, and potential secondary legislation are expected to be released throughout 2024 and into 2025.

The BNG marketplace awaits clarity from HMRC on how these payments will be treated for tax purposes and if a change of land use will impact Agricultural Property Relief (APR) on the land for inheritance tax purposes. BNG tax considerations are currently the subject of consultation.

For landowners and land managers who are interested in exploring opportunities within this evolving marketplace, Brown&Co has its own specialist in-house BNG team. Experienced ecologists and
consultants can advise and assist with the process from the initial habitat assessment of land for BNG value, through the entire process to the establishment of new, biodiverse habitats and the commercial sale process.

There is a lot for developers to consider too, from design-stage evaluations of the biodiversity potential of a would-be site, to connecting with land managers who can deliver offsite BNG value to meet planning obligations. The Brown&Co team can support all stages of the ecology and BNG process to deliver development solutions for its clients.

If you are affected by the new Biodiversity Net Gain regulations, you can contact your local Brown&Co office for support below:

Contact your local office