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The BNG balancing act: Finding harmony between nature and development

The debate surrounding biodiversity net gain has left the industry feeling divided, with advocates for on-site solutions pitted against those championing off-site projects.

To truly benefit both nature and people, we must adopt a holistic approach that strikes the right balance, or we risk delivering for neither. 

As of 12 February 2024, biodiversity net gain (BNG) became mandatory in England, requiring housebuilders to ensure a minimum 10% improvement in biodiversity post-development.  

While this policy has the potential to revolutionise the way development interacts with the natural environment, its success hinges on our ability to think beyond the binary thinking of on-site versus off-site.

The mitigation hierarchy and BNG strategy 

It's crucial to recognise that the mitigation hierarchy always applies, meaning developers must first avoid and mitigate their impacts before considering on-site compensation and, finally, off-site solutions. This framework alone ensures that BNG does not inadvertently push nature away from development sites, something that critics of off-site solutions can suggest. 

Every development should produce a comprehensive BNG strategy, that maximises opportunities for nature at every stage. This involves clever design that incorporates biodiversity without compromising green infrastructure, open spaces, or the potential for channelling vital funds into nature restoration.

Recognising the limitations of on-site BNG

While creating areas of high value for nature within a development footprint is possible, it comes with not-insignificant challenges. Wildflower grasslands, for example, may struggle to reach and maintain their value over the required 30 years when competing with recreational activities and the presence of introduced domestic pets. 

Moreover, residents may not appreciate the aesthetic of "messy" scrubland near their new homes, and management companies may struggle with the maintenance and protection required to maximise the value of these areas. 

Work by the Millennium Ecosystem Assessment and Natural Capital Committee has shown that placing BNG habitats on-site risks directly disadvantaging local people who may face limited access to green spaces they previously enjoyed. 

Researchers from the Department of Biology at the University of Oxford also investigated on-site BNG, noting that: 

“Whilst the drive for delivering on-site habitats is likely a product of one of the key policy goals to improve public access to green spaces [...], our evidence demonstrates that this goal is likely to conflict with the other goal to enhance wildlife and ecosystems.” (Emily E. Rampling and Sophus O.S.E. zu Ermgassen) 

These limitations highlight the need for a nuanced approach to on-site BNG. 

This is certainly not a call to push all BNG off-site. That would be a missed opportunity, as there can be genuine win-wins for residents and nature that can be achieved on-site. Well-designed sustainable drainage features, for instance, can provide valuable habitats while enhancing the visual appeal of a development. 

However, off-site projects, such as transforming unproductive farmland into undisturbed habitats for declining bird species, can offer significant benefits that aren’t possible within the confines of a development site.

Habitat Bank visualisation

Collaboration and verification

The term "off-site BNG market" implies a tradability akin to carbon credits, but this is not the case for BNG. It would be more accurate to call it a marketplace as transactions can only occur once and in one direction. 

For years now a variety of off-site project developers, such as Environment Bank, have been laying the groundwork for the new policy. Recognising that developers would prefer to choose from a range of high-quality, verified projects that align with their holistic BNG strategy, rather than brokering individual deals with landowners for each development.  

Habitat banking as a concept was developed in the very knowledge that often only residual requirements, sometimes adding up to just a fraction of an acre, may be required once developers have followed the mitigation hierarchy. But when pooled together across multiple developments in a region, this can contribute towards impactful, large-scale nature recovery. 

To support SME housebuilders, providers like Environment Bank are offering fractional Biodiversity Units to help meet specific BNG requirements as cost-effectively as possible.

Effective policy in practice

Off-site options are already allowing vital development projects to go ahead, while also ensuring that BNG policy still delivers for nature.  

Environment Bank recently partnered with Wakefield District Housing and developers from Hoober Urban Partnerships for a social housing project in Sheffield. After following the mitigation hierarchy, the developers still needed off-site BNG to fulfil their requirements.  

Alongside legal and planning support, Environment Bank provided off-site Biodiversity Units from its Bolsterstone Habitat Bank located only a short distance away – within the site’s local planning authority (LPA) area – enabling the project to proceed. 

As a result, 26 new family homes are being built within a few miles of Sheffield city centre and new habitats are being created nearby. Without an off-site solution, the project would not have been viable, and an essential social housing project would have been halted.

A policy for nature and people

BNG has the potential to dramatically reduce the impact of development on valuable, often irreplaceable habitats while also incorporating nature to enhance communities. 

However, if a decade from now we find that we have created more expensive housing developments with little tangible benefit to nature, the policy will have failed. Success relies on our ability to think holistically and maximise the opportunities presented by BNG for both nature and people. 

This isn't just about saving money or maximising developable area, it’s also about finding the right balance that delivers the best outcomes for nature and communities. 

Expecting developers, particularly those working on medium and smaller scales, to provide all their BNG on-site is unrealistic. By embracing a holistic approach to BNG, we can create thriving, sustainable communities that coexist harmoniously with nature, while also helping channel much-needed funding into landscape scale nature recovery at the same time. This isn’t about picking sides.