Image: a disused that does little for biodiversity. Source: Wikimedia Commons
This is a guest post from Alfie Robinson. Alfie is a historian and heritage consultant operating across England, with a keen interest in policy issues. You can find Alfie on LinkedIn or find his website here.
A few weeks ago, I did a double-take when a striking post crossed my eyes on LinkedIn. A consultant complained of a single tree—yes, one tree—costing the developer of a small housing site in excess of £40,000. Why would this happen?
The answer is a recent bit of planning policy, ‘Biodiversity Net Gain’ (BNG). On the face of it, it is a good idea. By getting developers to do their bit, planning permissions for new homes could come with enhancement to habitats. Given the United Kingdom has more-than-usually depleted biodiversity, this step would seem a win-win.
By adding habitats to development sites (things like wetland, woodland, hedgerows and trees), BNG seeks to counterbalance nature losses from developments and end up with an overall increase in plant species—hence the ‘net gain’. Because it is very difficult to count up the species themselves, BNG uses habitats as a proxy for biodiversity itself.
Balancing the quality of our natural environment with the country’s need for new homes is important. Unfortunately, BNG is not working. BNG is a major blocker of small sites and may be partly to blame for a recent fall in planning approvals. Worst of all, BNG as currently designed may even contribute to the destruction of countryside and reduced biodiversity itself, because of the way it perversely encourages larger-scale greenfield development over small brownfield sites. In short, there are two problems with BNG. One is that it disadvantages small developments by design. The second is that its detailed machinery makes development both very expensive and very confusing.
Disadvantaged by design: small sites and BNG
The last thing that the incumbent government needs to solve the housing crisis is a new layer of complexity and expense in the planning system. But complexity and expense are certainly increased by BNG. The policy mandates a minimum of 10% net gain in biodiversity on all development sites. Initially, the policy only applied to large sites, but today it applies to all sites: even if you’re building a single house.1 What’s more is that householder development, things like back-yard extensions, with more than 25 square metres of development will also have the same BNG requirement.
Large developments can afford to spend longer on planning bureaucracy: their developers have more resources. But any site with more than nine buildings has to handle the new, complex demands. This is often too expensive, making the plan unviable. The metric, the way the BNG policy measures biodiversity units, has 79 pages of guidance, and according to ecologists, still leaves many questions unanswered. LinkedIn is awash with complaints from professionals—including ecological and landscape consultants—about the uncertainties and inconsistencies in the system. Again, uncertainties and inconsistencies aren’t just frustrating: they are expensive.
Why, for instance, do the regulations discourage developers from trying to use gardens to create BNG? This can force developments on small sites to pay for expensive off-site credits. Gardens are deemed valuable if they already exist, but of little to no biological value when they are proposed, which is inconsistent. Why do local planning authorities assume that trees one adds to a new site should be considered ‘small’ (and of low biodiversity value) despite the fact that trees grow? This is a consequential point, since one large tree (more than 90cm diameter) is considered equal to 190 small trees (trees less than 30cm wide) in biodiversity terms. This is challenging enough for sites where you can realistically plant enough trees to account for a major loss like this. For many developments, though, there simply isn’t space.
If there isn’t space to add to biodiversity on site, developers are left with no choice but to purchase off-site ‘credits’. This means they’re essentially paying for the fact their site, often a small infill site, makes it impossible to create a biodiversity net gain. In this way, the BNG policy can be thought of more as a biodiversity tax than a biodiversity implementation, and one that is applied unfairly. ‘Biodiversity credits’ are worth exactly half a ‘biodiversity unit’ from a habitat that exists on site. This, combined with the high price of biodiversity credits, means things get very expensive, very quickly. Because small builders will work on small sites, this hurts them the most. What’s all the more concerning is that a National Audit Office report from May 2024 points out that there is currently no mechanism that exists for the money raised from biodiversity credit sales to actually be spent on biodiversity.
Pricing and the small print: impassable barriers for small sites
Was that £40,000 figure for a single tree an exaggeration? Once we dig into the details of how BNG units and credits work, and how they are priced, we realise the answer is no.
To illustrate how the details of BNG affect small sites, it’s worth considering an example of the pricing structure. Take a single hectare of low distinctiveness, low significance and poor condition ‘modified grassland’. This could mean football pitches, garden lawns, or grazing land. Environmentalists often call this type of land a ‘green desert’ as it’s so low in biodiversity.
In BNG policy terms, this single hectare is worth a minimum of two biodiversity ‘units’. The loss of this much ‘green desert’ through development means finding four biodiversity credits. Most likely this means the developer spending £168,000 on credits under the existing pricing system. Though the private providers of credits can be significantly cheaper (by up to a factor of two), more valuable habitats get exponentially more expensive.2 These spiralling costs can easily make development completely unviable. The smaller the site, the more developers are exposed to costs like this. It’s not hard to see how the expenses related to low-value ‘units’ could make housebuilding unviable. In such a punitive system, why bother building on small sites?
The costs are even worse on brownfield sites. Building on land in cities, be it former industrial sites or densifying existing residential, is one of the most climate friendly and pro-growth types of development. Much of this brownfield land, however, scores very highly in terms of biodiversity units because the ‘mosaic’ of cracked surfaces and abandoned buildings. According to an ecologist, these habitat types are being over-identified at present which worsens the problem and could be resolved by clearer guidance. ‘Mosaics’ like this are being treated as much better habitats than greenfield spaces in open countryside, and so BNG makes them harder, and more expensive, to build upon. These small sites are where there is the least space to create new biodiversity units.
Experts are already sounding the alarm that this is a major problem on completing sites. Planning permissions for new homes have nosedived in the last twelve months. It’s hard to see how this challenging, poorly-designed piece of policy wouldn’t be at least partly to blame.
All the while, policy ignores the implicit carbon emissions reductions that come with infill development. Bringing people closer to settlements, and closer to transport, reduces their carbon footprint. It’s worth remembering that by far most of the emissions from the built environment come not from ‘embodied carbon’—the process of building, but from in-use emissions: the emissions from using buildings, and from travelling to and from them.
Building new houses on brownfield sites, and small infill sites, is ideal for cutting these emissions down. Yet planning policy provides few incentives for doing this kind of development properly, and now it is punishing this kind of development. Furthermore, academic research on the BNG policy in the UK has already begun to demonstrate that most of its efforts go into policing BNG in the theoretical, planning stage, while there is little to no provision for checking whether BNG solutions are actually carried out. For this issue, and for small sites, a better solution might be to put modest contributions towards a different, centralised fund to create joined-up habitats, rather than a mosaic of smaller, privately managed sites: larger sites are better in biodiversity terms.
Globally, the land-use change which is threatening biodiversity the most is from intensive farming, not from development. In the UK, the story is no different. Yet it’s new homes, and particularly well-connected urban new homes that the policy burden lies upon. Biodiversity Net Gain needs to be made fairer to small sites, both in its overall design (the punitive treatment of off-site solutions) and in its details (the way private gardens are treated, for instance).
Policymakers should consider shifting the burden away from small sites by adding a modest increase in BNG, say to 12%, on large sites. Releasing small, back garden extensions from the policy entirely would be sensible. Provision for the way habitats can mature and become more valuable over time (rather than treating trees as if they never grow) would also make a big difference in redressing the balance of the policy.
National policy should encourage, not prevent, small-scale development in our cities. To tackle the climate crisis we need more homes in our cities, in walking distance of public transport, not on sprawling greenfield sites. BNG needs reform so we can get building the sustainable homes that this country so desperately needs.
- Unless you’re doing “custom” or “self-build” housing, in which case, the threshold is 9 houses. ↩︎
- The most valuable habitats are already rightly protected by existing planning policies and designations like AONBs (Area of Outstanding Natural Beauty) and SSSIs (Special Sites of Scientific Interest). ↩︎
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