A technical consultation on Biodiversity Net Gain (BNG) that is not just “technical”
In late September, the window for providing comments to the government’s “Technical consultation on the biodiversity metric” was closed.
The consultation was mostly regarding technical matters on which, as legal professionals, we are not able to dwell in detail. However, among the proposals in this technical consultation, there were some points related to policy and legal considerations regarding BNG.
These matters were covered by questions 1 and 2 of this consultation, which we will address here.
Question 1: Do you think that the spatial risk multiplier values need reconsidering to better incentivise high value off-site delivery?
Context
The BNG tool for calculating the BNG compensation is named the “biodiversity metric”. The biodiversity metric 3.1 is the current version of this tool. This tool uses several multipliers to calculate the BNG value.
The “spatial risk multipliers” are used to assign higher value to BNG compensation carried out on-site, while lower value to compensation off-site. As an example, for area habitats, the highest multiplier (1.0) is assigned for compensation within the Local Planning Authority (“LPA”) or National Character Area (“NCA”) of impact site, a reduced multiplier (0.75) is assigned for compensation in a neighbouring LPA/NCA, and the lowest multiplier (0.5) is assigned for compensation beyond neighbouring LPA/NCA.
The consultation proposed to modify these multipliers for the following reason:
“The biodiversity net gain credits pilot identified that the spatial risk multiplier can generate negative scores for reasonable habitat enhancements on distant sites with high or moderate baseline values. These results may incentivise the creation of lower distinctiveness habitats. […]”
[Emphasis added]
Our opinion
The consultation shows the generation of negative scores “on distant sites” as a problem, but we cannot understand why this should be portrayed as such.
The primary aim of BNG is to benefit areas as close to the development as possible. Meanwhile, offsetting should be a last resort where losses of biodiversity cannot be compensated for on site. Many responses recorded on “Net gain – Summary of responses and government response – July 2019” also agreed with the above and stressed that BNG should prioritise compensation on-site.
Further, the above follows the logic of the mitigation hierarchy, which is a principle already well established in planning policy and crystalized in the paragraph 180 of the NPPF:
Habitats and biodiversity
180. When determining planning applications, local planning authorities should apply the following principles: a) if significant harm to biodiversity resulting from a development cannot be avoided (through locating on an alternative site with less harmful impacts), adequately mitigated, or, as a last resort, compensated for, then planning permission should be refused;
This mitigation hierarchy is in place to ensure that developers will try to maximise all onsite opportunities for improving biodiversity before resorting to offset mitigation. This is most easily explained in the graphic below:
Source: RPS
For all the above, we consider that the creation of habitats on distant sites is not a priority.
In that regard, while we cannot respond if the spatial risk multipliers of 1.00, 0.75 and 0.5 are adequate, we consider that the logic of assigning lower scores to distant sites should remain unaltered.
Instead of modifying the multipliers, the government should explore altering the biodiversity metric’s formula to give higher scores for habitat creation on distant sites only if it is impossible to carry out compensation within the LPA/NCA or neighbouring LPAs/NCAs.
Question 2: Do you think that providing guidance on considerations for what habitats can be typically achieved on-site would be helpful?
Context
The consultation provides that some LPAs are having the challenge proposed habitat interventions, which can happen when the habitats are too small to be ecologically functional. For that reason, it was proposed to:
“[…] include considerations for deciding which habitats are achievable on-site. This would help to steer developers towards deliverable proposals to help wildlife.”
[Emphasis added]
No information is provided regarding these considerations. We only know that the size if the habitats is one of them.
Our opinion
While we understand the good intentions behind the proposal, we consider that this could be damaging for the objectives of BNG, because this could lead to “recommended” habitats for certain locations, which has two major issues.
First, identifying which habitats can be achieved in each location can only be done on a case-by-case basis, because the characteristics of that location need to be taken into consideration before choosing which habitat is the most adequate. The characteristics of different locations can vary greatly, even if they share the same habitat type. In that regard, guidance on which habitats are achievable could override this analysis and lead to the creation of habitats that are not the best given the existing conditions.
Second, adding “recommended” habitats would also create perverse incentives for both developers and LPAs, as decisions on BNG compensation will follow the path of less resistance.
Developers need to get theirs projects started as soon as possible, so they would be incentivized to only choose the habitats marked as recommended (“achievable on-site”), as it will be more likely for a BNG compensation proposal to be approved if the recommended habitat is chosen.
LPAs might be tempted to allow only the habitats marked as “recommended”. LPAs have limited resources at hand, which are reduced further with each cut in their budget. Authorising BNG compensation proposals for recommended habitats would use less of these scarce resources, compared to the thorough analysis that should be required for habitats outside the recommendation.
The above perverse incentives might lead to the creation of only certain same types of habitats around UK. This would mean the creation of uniform habitats, instead of diverse ones, which would go against the BNG objective of improving bio-“diversity”.
Conclusion
The most recent technical consultation on BNG, while still mostly technical, also addresses matters that step into policy and legal spheres.
First, it is proposed to alter the spatial risk multipliers because they were giving negative scores for habitat enhancements on distant sites. We consider that these negative scores are not an issue, because compensation onsite should be the priority based on the mitigation hierarchy, and offsetting should only be a measure of last resort. If the government wants to make compensation off-site more accessible, maybe they should explore modifying the formula to allow for higher scores only if compensation on-site is not possible.
Second, it is proposed to include considerations for deciding which habitats are achievable on-site. We disagree with this idea. While it has good intentions, it could lead to “recommended” habitats for certain locations, which has two major issues: (i) habitat selection can only be done on a case-by-case basis and the guidance could override this analysis, and (ii) it creates perverse incentives for developers and LPAs. Developers would only choose the recommended habitat because it will be easier for that proposal to be approved. LPAs would prefer recommended habitats because the evaluation of proposals would consume fewer resources. This might lead to the creation of uniform habitats, instead of diverse ones.
