One year with BNG Legislation
One year with BNG legislation – the opportunities, challenges and lessons learnt
Today marks exactly one year since BNG for major developments was mandated in law and one year since we hosted DEFRA’s BNG UK Launch event at Belmont Estate. On 12 February 2024, we welcomed Tony Juniper, former Environment Minister Rebecca Pow and industry leaders to celebrate this significant milestone for environmental legislation. We held keynote speeches from Minister Pow and Tony Juniper, followed by a tour of our rewilding and rewetting project, Watercress Farm.
It has been an exciting year seeing BNG starting to be implemented, while this complex emerging market has also brought challenges and lessons learnt for all industry stakeholders. To mark a year since the introduction of BNG regulations, we’ve put together some of our key insights gained in the first year of BNG.
1. SLOW MARKET DEVELOPMENT NOW SPEEDING UP
Although the new BNG legislation came into force in February 2024, the market remained fairly quiet until around September. Many developers had been racing to submit planning applications before the mandatory BNG date, so a quieter period naturally followed.
Now that those sites have gained planning, the market has become busier as sites enter the planning in situ that now comes under the new BNG requirements. Initially, DEFRA estimated that the introduction of BNG would generate an annual demand for around 6200 offsite BNG units, but current demand suggests this will be higher as the market evolves.[1]
The offsite market has developed to meet the demand. As of last week, there were 43 registered sites on the BNG Gain Sites register, and the number is expected to increase significantly this year.
2. Inconsistent local authority adoption
DEFRA provided advice and training to LPAs ahead of BNG’s official launch, as well as funding allocations of either £26,807 or £43,467 to each local authority to prepare for BNG.[2] In spite of this, DEFRA acknowledged that some LPAs were more ready than others for the launch of BNG.
A survey by the Royal Town Planning Institute of its members in February 2024 found that “81% of planners in the public sector needed further ‘guidance, advice, and support’, 68% of all planners needed more staff and skills, and 61% require more case studies of best practice.”
Likewise, many developers lack the necessary ecological expertise to effectively design, assess, and implement BNG projects, also contributing to bottlenecks in approvals and delivery. While understanding of BNG will naturally improve over time, we would also welcome extra support for LPAs to improve the BNG implementation process.
3. Lack of robust legal documents has slowed progress
For offsite BNG providers, navigating the required legal documentation to become registered has been challenging. This has led to delays in sites becoming registered. Obtaining an s106 agreement with an LPA is a complex process, with some LPAs understandably struggling with a lack of resource and expertise to develop and process agreements. Furthermore, there was no standardised s106 document in use across all LPAs. LPAs each developed their own document, meaning scaling and uptake was slower as providers had to adapt to each LPA process.
As a result, many landowners looked to secure conservation covenants as an alternative route to attaining registration. Conservation covenants have tended to be the mechanism of choice for offsite providers, as responsible bodies are able to enter into them more quickly than LPAs can s106 agreements. However, there were bottlenecks here too, as there were initially only a very small number of responsible bodies to co-create conservation covenants with.
Landowners going down the conservation covenant route have also been met with very high fees from responsible bodies. This could potentially be creating a barrier for BNG small sites registering as offsite providers without a broker. With more and more responsible bodies now achieving registration, this should reduce the bottleneck and make it easier for offsite BNG providers to become registered. We may also see more competitive pricing from responsible bodies.
4. compliance and enforcement risks are still present
A report on BNG from the National Audit Office in May of last year highlighted that the division of responsibilities within BNG means there is still some risk of BNG not being properly implemented across the board.
The long-term success of DEFRA’s BNG policy depends on external organisations that it cannot directly control, while its governance structure after implementation remains a work in progress. While LPAs have a legal duty to monitor compliance and take enforcement action as appropriate, they have not received additional funding specifically to monitor or enforce on-site gains. This could lead to developers failing to carry out BNG successfully on-site. We hope that, as time goes on, these governance gaps will be addressed to ensure proper implementation of BNG.
5. The ecological profession is on the rise
Unsurprisingly, the demand for ecologists to assess and monitor BNG sites has been incredible. It is certainly positive to see nature-based skills and knowledge valued, as well as the funding and encouragement for people to pursue nature-based careers.
One challenge, however, is that the current demand for ecologists is outweighing availability – this is another contributing factor to bottlenecks in BNG providers getting registered.[3] While we may see new technological advancements to support BNG assessments and monitoring of biodiversity, BNG is still in its infancy and needs to be supported by a qualified ecologist. Hopefully, as time goes on and new ecologists enter the profession, some of these bottlenecks will clear.
6. the onsite vs. offsite BNG debate continues
While BNG legislation emphasises that developers should seek onsite solutions before offsite ones, both have their advantages and play an important role in delivering BNG. While smaller-scale onsite habitats may face long-term management challenges and higher failure risks, offsite BNG allows for more ambitious, larger-scale habitat creation with potentially greater ecological impact and resilient species populations. They are more likely to be competently managed by restoration experts over the mandatory 30-year period.
Rather than viewing onsite vs offsite as an either-or choice, there is a growing understanding that successful BNG implementation requires both approaches. Selection should based on specific project needs, natural impact potential and community benefits. The key is understanding each option’s strengths to make informed decisions that best serve both development requirements and conservation outcomes.
7. Pricing has been inconsistent
As the BNG market establishes itself, it has been challenging for offsite providers to know where to price themselves. While the government has laid out statutory prices and added a markup so as not to undercut the private market, many private offsite providers have been cautious to share prices, making comparison difficult.
Furthermore, in these early days of BNG, we are seeing some lower prices that have perhaps not taken into account the costs of maintaining and monitoring a site for 30 years. As we mentioned in our top 5 BNG predictions for 2025, we expect prices to rise as people’s understanding of the long-term requirements of BNG develops.
8. complex habitat banks are in demand
As expected, there is a significant demand for habitats with higher distinctiveness due to the difficulty of replacing these. Often, developers will need to look outside their local area to find suitable offsite providers for the specific higher distinctiveness habitats they need to replace.
Therefore, developers are often looking for habitat banks offering complex habitats so that they can obtain a variety of broad habitat types from one provider.
We’ve found that scrub and grassland are the most in-demand habitat units, as they are the ones that most commonly need to be removed from development sites. The most in-demand woodland habitat type seems to be lowland mixed deciduous woodland, which is rarer. Also, the risk multiplier used when delivering these habitats on-site means that many developers seek to find offsite units instead.
Looking forward
A year into mandatory BNG, we have seen promising progress but also encountered various challenges along the way. Working to address these challenges across all levels will be crucial as the policy evolves to ensure that BNG delivers tangible and lasting biodiversity improvements.
At Belmont, we remain committed to sharing insights and driving forward best practices for BNG and beyond, working towards our vision of a regenerative and reconnected world. For insights into how we expect BNG to develop over the next year, read our blog post, “Top 5 Predictions for BNG in 2025.”
Belmont’s BNG units
If you’re looking to purchase BNG units across a range of habitats, all with robust, long-term plans for nurturing biodiversity and local communities, then get in touch, and we will be happy to support you on your BNG journey.
[1] https://consult.defra.gov.uk/defra-net-gain-consultation-team/consultation-on-biodiversity-net-gain-regulations/supporting_documents/Consultation%20on%20Biodiversity%20Net%20Gain%20Regulations%20and%20Implementation_January2022.pdf
[2] https://www.nao.org.uk/wp-content/uploads/2024/05/implementing-statutory-biodiversity-net-gain-summary.pdf
[3] https://www.nao.org.uk/wp-content/uploads/2024/05/implementing-statutory-biodiversity-net-gain-summary.pdf