Introduction

A key focus of the long-awaited Environment Act 2021 (Environment Act) is the requirement on developers to provide a biodiversity net gain of at least ten percent on all new developments. The net gain is established by comparing a site’s pre-development baseline with the position post-development using a “biodiversity metric”. How this metric functions will therefore be critical for developers when designing their schemes.

In July 2021, Natural England launched a new “Biodiversity Metric 3.0” as well a “Small Sites Metric” (SSM) for use on small sites. We discuss these below.  

Biodiversity metric 3.0

Biodiversity Metric 3.0 (the Metric) is an updated version of a previous biodiversity metric produced by Defra. It uses habitat as a measure for wider biodiversity with different habitat types scored according to their relative biodiversity value. This value is then used to calculate the number of “biodiversity units” taking into account the size, distinctiveness, condition and location of the relevant habitat.

The Metric can be used to measure on-site and off-site biodiversity. If the required biodiversity gain cannot be provided onsite (for example, by on-site habitat creation or enhancement), the Metric can be used to assess the impact of off-site habitat creation or enhancement.

In simple terms, the Metric calculates the change in biodiversity resulting from a development by subtracting the baseline biodiversity units from the post-development units. Unlike some other tests (such as EIA for example), the Metric is not concerned with indirect impacts on biodiversity.

According to the guidance document[i], the Metric supports the mitigation hierarchy, by allowing biodiversity gains to be achieved more easily through the avoidance of on-site habitat losses, rather than relying only on the creation of new habitat or enhancement of existing habitat.

The Metric cannot be used in all cases: impacts on ‘irreplaceable’ habitats (such as ancient woodland, limestone pavement, sand dunes and lowland fen) cannot be adequately measured. A competent person must carry out the habitat survey and assessment.   

If the required biodiversity gain (as calculated using the Metric) cannot be achieved by on-site mitigation/ enhancement and/or off-site mitigation/enhancement, the developer will need to provide a financial contribution to the Local Authority for the purpose of mitigating the biodiversity impacts of the scheme. The value of the contribution is not calculated using the Metric. As it currently stands, it looks as though the cost of contributions per “biodiversity unit” will vary depending on the Local Authority.  Contributions can be costly and will be secured by a legal agreement (this may be by way of a section 106 agreement or following the enaction of the relevant sections of the Environment Act, potentially by way of a conservation covenant). Once the relevant provisions of the Environment Act have effect, planning permissions will (as a result of a statutory requirement) automatically be subject to a condition mandating that the “biodiversity gain objective” is met (that gain of 10% may be achieved onsite, offsite or by way of a financial contribution).

Small sites metric (SSM)

The SSM is a simplified form of the Metric and may be used where both of the following criteria are met (i.e. both the following size criteria and the absence of priority habitats):

Development sites where:

• (for residential developments) the number of dwellings is between 1 and 9 (inclusive) on a site having an area of less than one hectare; or
• the site area is less than 0.5 hectares (where the number of dwellings to be provided is unknown); or
• (for all other types of development) the site area is less than 0.5 hectares or less than 5,000sqm; and

Development sites where there is no priority habitat present within the development area (excluding hedgerows and arable margins). Priority habitats include rivers, certain woodland, meadows and bogs[ii].

The SSM must not be used to calculate offsite losses and gains.

Next steps

The Environment Act (finally) received Royal Assent on 9 November 2021. Significantly, the Act includes a requirement that the new biodiversity metric (and any revised metric) are subject to Parliamentary approval. Before the biodiversity net gain provisions come into force, a raft of secondary legislation will need to be produced.  There is no fixed timeframe for the introduction of the biodiversity net gain provisions, but many Local Authorities are already requiring that new developments are at least biodiversity net neutral if not requiring that the development results in a biodiversity net gain. It is therefore imperative that developers become familiar with the new Metric and the need to plan in biodiversity gain within their schemes from the start, to ensure planning permissions are deliverable. The Metric has already received considerable criticism regarding its assessment of the value of certain habitats and that it is possible to “trade out” nature (i.e. by paying a financial contribution instead of enhancing biodiversity). Given the controversy already received, it is anticipated that the Metric will continue to evolve, particularly once it is in wider use.

For more information on the above please contact Sophie Willis or your usual Charles Russell Speechlys contact.

[i] Biodiversity Metric 3.0: Auditing and accounting for biodiversity – User Guide (7 July 2021)
[ii] A list of priority habitats can be found here.