What is BNG?
Biodiversity Net Gain, or “BNG” for short, is for many people the most puzzling of the main three land-based pollution offsets (the other two being carbon and nitrate offsetting). People generally understand what is meant by biodiversity: the prevalence of different species in a particular environment, such as would be found in virtually any natural ecosystem (woodlands, wetlands, lagoons, moors, scrubs, and so on). This is contrasted with inorganic environments, such a carpark or an industrial estate, or a monoculture, such as a cultivated wheatfield or an algal bloom.
People generally also understand why biodiversity is a good thing. Natural processes undertaken by organisms in an ecosystem support almost everything in nature that humans need to survive: food, clean water, clean air, medicine and shelter. It is also true that the prevalence of nature is for many people desirable by itself: people like to see a river filled with different kinds of fish; a forest full of different kinds of plants and animals. Humans evolved over millions of years in the bosom of nature. It is not surprising, therefore, that people simply prefer biodiversity to sterile, inorganic surroundings, aside from the benefits to their health.
If biodiversity is a good thing, it stands to reason that more of it is even better. If a property development would see a one hectare wildflower meadow destroyed, biodiversity has been lost. If those same property developers contract a local farmer to convert two hectares of his or her land from wheat production to scrubland, biodiversity could have been increased on a net basis. Analysis will be required to determine whether this has actually occurred, which brings us to the heart of what puzzles many people about BNG.
How is BNG measured?
Concentrations of carbon and nitrates in a soil layer can be determined with a reasonable degree of accuracy, but how do you measure the variety of organisms in a location, and not least because – unlike in, say, an aquarium – organisms can drift in and out as they please.
This has always been the challenging aspect to assessing biodiversity, or indeed any ecosystem survey, and will be familiar to school children who went on geography field trips to the beach to count organisms within a one metre grid. The seaweed may not move during your count, but the crustaceans might, and the seabirds certainly will!
Nowadays, ecologists have computer-aided modelling techniques which allow sophisticated real-time, on-site analysis to a degree not previous possible. Technology has also helped, of course. As an example, devices sometimes referred to as ‘sampling boxes’ can be set up in a location, and over a period of time will analyse DNA from particulate matter. These devices can distinguish between DNA traces from different species, and will give a far more accurate measure of biodiversity in an area than could be achieved by attempting to manually count out the species.
Using the previous example of the property developer, to determine that a net gain existed, a model would be used to estimate the incremental biodiversity created by converting two hectares of wheatfield into scrubland. Combined with an assessment of the biodiversity lost by developing the wildflower meadow, an ecologist can demonstrate empirically whether a biodiversity net gain – or BNG – has been created.
As obvious as it sounds, the greatest BNG can be achieved from poor quality land, since this is where the greatest improvements can be realised.
What is the relevance of BNG to land developers?
From November 2023, all housing and infrastructure developments are required to measure biodiversity value before development and provide compensatory habitat, if required, plus a further 10%.
In short, developers must demonstrate a biodiversity net gain in order for the proposed development to receive planning permission.
In a similar way to carbon and nitrate offsets, developers will generally turn to nearby landowners and managers to provide offset habitat. Long-term agreements will be put in place to produce a biodiversity net gain, either by habitat creation, reduction of habitat destruction, or a combination. Practically speaking this could involve taking agricultural land out of production, the creation of wetlands, the removal of asphalt, and the planting of trees.
You will notice that the above examples are very similar to what is required for carbon and nitrate offsets. There is no legal or regulatory bar to a landowner monetising offsets for all three (carbon, nitrates and BNG) via the same process, meaning that a landowner could effectively be paid three times for planting the same tree. If that seems counterintuitive, recall that the single tree has multiple benefits to the environment and society, even beyond just the three named offsets.
What are BNG units and statutory credits?
It is important to distinguish between ‘units’ and ‘statutory credits’. BNG units refer to the output of the biodiversity metric being employed, which will tend to refer to a particular area’s size, natural distinctiveness, overall condition and strategic significance. Distinctiveness, condition and strategic significance are important qualitative factors which go beyond simply the number of different organisms in a particular habitat.
For example, when an ecologist is assessing BNG in two areas, he or she would distinguish between a quarter acre of sparse beech woodland forming a copse in the centre of a busy roundabout, and a quarter acre of rich beech woodland forming a vital ‘wildlife belt’ between two areas of nature-rich ancient forest. Two areas of the same size and with similar organic makeup, but of a different condition and with a very different environmental impact.
BNG units may be sold by any landowner in a private sale to a developer, or indeed to any willing buyer.
‘Statutory credits’ are a ‘last resort option’ for developers, if they cannot deliver the BNG they require in the local area or via purchasing off-site biodiversity units. Only the government can sell statutory credits. The compliance market for off-site biodiversity units is different to voluntary biodiversity credits.
At AKA we refer generically to ‘credits’, in order to be consistent with how nitrate and carbon offsets are measured. Unless otherwise stated, these are not ‘statutory credits’, which at present only the Government can sell.
What should landowners do about BNG?
A landowner interested in monetising his or her biodiversity potential should register the land on a platform like AKA, where developers and BNG credit buyers can contact them. The landowner should also seek professional ecological input to assess how their land can deliver the best possible biodiversity improvement, and the best price for that improvement in the market place.
