The Government's two year investigation of six biodiversity offsetting pilot schemes did not have the desired take-up from developers.  DEFRA ploughed on to produce its Green paper in September 2013 entitled Biodiversity offsetting in England

The House of Commons Environmental Audit Committee in November 2013 concluded that it was too soon to reach a decision on offsetting whilst the pilots have yet to be completed, and independently evaluated. 

The pilots ended in March 2014 and are currently being assessed by Collingwood Environmental Planning.  Their report is due later this Summer.

A two day global biodiversity offsetting conference entitled 'To No Net Loss of Biodiversity and Beyond', opened in London on 3 June, evidencing the interest of governments, policy makers and environmentalists around the worlds in seeking to develop effective biodiversity offsetting initiatives.  The development industry should keep their ears to the ground for any hints on the future policy direction in this area.   

The aims of biodiversity offsetting

In the UK, all public authorities must have regard to the purpose of conserving biodiversity in exercising their planning determination functions (endnote 1).  There is often a natural conflict between promoting development and preserving and enhancing biodiversity.

The Government is seeking to introduce a policy that would enable development in ecologically sensitive areas without compromising biodiversity. Ecologically sensitive features that would be lost through development would be replaced elsewhere, meaning that no net loss in biodiversity, and in some cases the potential for a gain.  

The Pilot schemes

DEFRA started its practical investigations into biodiversity offsetting in April 2012 by implementing six two-year pilot schemes in Essex, Warwickshire, Doncaster, Devon, Greater Norwich and Nottinghamshire.  These were voluntary schemes.  Collingwood Environmental Planning's interim report identified a lack of suitable biodiversity offsetting projects coming forward.  Developers seem to have been cautious about what they see as an additional process with limited obvious benefits.

Jumping the gun

Ahead of the conclusion of the pilots, in September 2013 DEFRA published its Green paper, To No Net Loss of Biodiversity and Beyond, which championed the use of biodiversity offsetting. 

The Green paper proposed biodiversity offsetting where any residual damage caused by development could not be avoided or mitigated against.  It drew on experiences from more than 25 countries throughout the world, including the development of an 'offsetting metric' which quantifies the value of habitats based on the habitat's: distinctiveness, quality, and size.  If planning consent was then to be granted, it would be subject to securing an offset under which the same number of biodiversity units wold be provided elsewhere as would be lost at the development site. 

The mitigation hierarchy – National Planning Policy Framework

The Government has made clear that the accepted 'mitigation hierarchy' described in paragraph 118 of the National Planning Policy Framework remains paramount. 

The hierarchy requires that developers should, in the first instance, seek to avoid significant harm to wildlife species and habitats through location of the proposed development on an alternative site.  Where this is not possible, developers should consider whether significant harm can be minimised through design or mitigation measures.  Finally, where there would still be significant residual harm, can this be compensated for by alternative measures?  Where development cannot satisfy the requirements of the mitigation hierarchy, planning permission should be refused.

What types of schemes would biodiversity offsetting apply to?

DEFRA's Green paper 2013 confirmed that whilst the planning system is comprised of a number of different regimes (e.g. planning permissions, development consent orders etc.), nature does not differentiate between the impact caused by development under the separate regimes; offsetting is intended to apply to all regimes.

The EAC's assessment

The Environmental Audit Committee's report on the Green paper proposals did little to disguise its disapproval of the timing of the proposals ahead of the assessment of the pilot schemes.  It also expressed a number of concerns with the biodiversity offsetting proposals opining that:

  • the proposed metric is too simplistic;
  • guidance is needed on how the assessment is to be carried out and by whom;
  • greater emphasis should be placed on the mitigation hierarchy so that offsetting is only used as a last resort; 
  • there is no evidence of how biodiversity offsetting could deliver 'biodiversity gain';
  • Natural England must be involved in the evaluation of any offsetting scheme;
  • a mandatory offsetting system would encourage an offsetting market to develop.

DEFRA has now confirmed that it will await the outcome of the pilots' assessment before taking any policy decisions on biodiversity offsetting. 

What next?

The pilot schemes have now closed and the report on the pilot schemes is due later this Summer.

In the meantime, 'biodiversity gain' is still a buzz term with the EAC report on the environmental impacts of HS2 calling for the government to aim for a biodiversity gain rather than no net loss.

The practical and policy outcomes of the London conference 'To No Net Loss of Biodiversity and Beyond', are awaited.  The development industry should keep their ears to the ground for any hints on the future policy direction in this area.