Councils and Developers Grapple with Biodiversity Net Gain Challenges and Innovations

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Recent analysis shows that since the Biodiversity Net Gain (BNG) policy came into force in February 2024 requiring developments in England to deliver a minimum 10% net gain in biodiversity around three‑quarters of developers are claiming exemptions to avoid compliance. These exemptions include ‘de minimis’, used in cases where developments affect under 25 sqm of habitat or where priority habitats aren’t impacted, such as on car parks, making up approximately 75% of exemptions. Other frequent exemptions include self‑build projects and retrospective planning applications that fall outside BNG requirements. These findings suggest exemptions designed for small‑scale developments are being used more broadly, leading to concerns around consistency and enforcement of biodiversity restoration ambitions.

Councils are also struggling to respond effectively: nearly 40% lack in‑house ecological expertise needed to assess and manage BNG requirements. This shortage is most pronounced among local authorities processing medium and large developments, where a lack of capacity has triggered planning delays and posed significant barriers for SME builders. In some cases, local authority ecologists have left their roles over the past year, further undermining effective delivery of the new environmental responsibilities.

In response, biodiversity specialists and policymakers are pushing for a shift towards off‑site BNG delivery models. The founder of the Environment Bank argues that off‑site net gain is not only more cost‑effective adding only around £3,000 per home compared to £12,000 £15,000 for on‑site but also ensures better environmental outcomes and clearer enforcement through legally secured agreements. While current policy anticipates over 50% of BNG will occur off‑site, actual figures are limited to under 10%, raising concerns that the policy’s potential for restoring 500,000 hectares of nature by 2030 is not being realised at scale.

Some local authorities are innovating with habitat banking to bridge the gap. In Leeds, for instance, the council has established its own habitat‑banking scheme: developers can buy biodiversity units to fund habitat improvements across public land. This approach has already supported grassland and woodland projects where BNG credits were delivered following public consultation. Meanwhile, Plymouth City Council created a council‑owned “habitat bank” funded via a loan, designed to help developers meet BNG through site‑independent delivery.

What this means:
The widespread use of exemptions and councils’ lack of ecological capacity risks undermining the credibility of BNG, delaying biodiversity restoration and weakening planning enforcement. Off‑site delivery through habitat banking offers a promising route to deliver ecological enhancements more reliably, affordably and at scale. However, achieving this will require policy adjustments to incentivise off‑site approaches, build capacity within councils, and ensure public confidence in the integrity and transparency of biodiversity investments.

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