Biodiversity Net Gain (BNG) has become an established feature of the planning system, requiring most developments to deliver a measurable improvement in biodiversity. While the Government has recently announced reforms designed to simplify the regime for smaller developments, the core principle remains unchanged: delivering at least a 10% biodiversity net gain is a mandatory requirement for the vast majority of developments.
The latest changes, which take effect from 6 August 2026, are intended to make compliance more proportionate for smaller schemes while maintaining environmental protections and supporting wider nature recovery objectives.
Greater Flexibility for Smaller Developments
One of the most significant reforms concerns the biodiversity gain hierarchy.
Historically, developers have been expected to prioritise habitat enhancement and creation on-site before looking to off-site solutions. From 6 August 2026, that approach will continue to apply to major developments, but smaller schemes will have greater flexibility in how they achieve biodiversity gains.
For non-major development, developers will be able to rely on registered off-site biodiversity units without first demonstrating that on-site enhancement opportunities have been exhausted. This is likely to be particularly beneficial for constrained urban sites, where balancing biodiversity, viability and development objectives can often be challenging.
New Exemptions for Small Sites
The reforms also introduce a new exemption for certain small developments.
Development on sites of 0.2 hectares or less will generally be exempt from mandatory BNG, provided no priority habitat is affected. Certain temporary developments, where the land is restored within five years, may also qualify for an exemption.
For many small residential and infill developments, these changes may reduce both cost and administrative burden. However, developers should remember that exemption from BNG does not remove the need to consider protected species, habitat protections or wider ecological planning requirements.
BNG Remains a Mandatory Planning Requirement
Despite these reforms, BNG is very much here to stay.
For developments that remain within scope, the requirement to deliver a minimum 10% biodiversity net gain remains mandatory and cannot generally be avoided through viability arguments. The obligation is secured through a pre-commencement biodiversity gain condition, meaning development cannot lawfully commence until an approved Biodiversity Gain Plan is in place.
As a result, developers should continue to consider BNG requirements at the earliest stages of site acquisition, promotion and project design. Leaving biodiversity considerations until planning permission has been granted can result in delay, increased costs and limited mitigation options.
The Continuing Importance of Early Planning
Although biodiversity gain plans are approved post-permission, successful compliance often depends on decisions made much earlier.
Early consideration should include:
- Existing habitat constraints and ecological surveys;
- Opportunities for on-site habitat enhancement;
- Availability of suitable off-site units;
- Potential impacts on site layout and developable area;
- Budgeting for biodiversity mitigation costs; and
- Programme implications associated with securing BNG solutions.
For larger developments in particular, early engagement with ecologists, planning consultants and legal advisers remains essential.
Off-Site Units and Habitat Banks
Where on-site delivery is insufficient, developers may need to secure biodiversity units elsewhere.
This can be achieved by:
- Delivering habitat enhancements on alternative land within their control;
- Purchasing units from registered habitat gain sites; or
- As a last resort, purchasing statutory biodiversity credits.
Government credits continue to be intentionally expensive, encouraging developers to prioritise on-site and market-based solutions wherever possible.
Opportunities for Landowners
While BNG is often viewed through the lens of development constraints, it also presents opportunities for landowners.
Land can be used to create Habitat Gain Sites, generating biodiversity units that can be sold to developers requiring off-site mitigation. For some landowners, particularly those with underutilised or marginal land, this may provide a long-term alternative income stream.
However, entering the BNG market is a significant commitment. Habitat enhancements must generally be secured for at least 30 years through either a section 106 agreement or a conservation covenant, supported by a Habitat Management and Monitoring Plan. Landowners should therefore carefully consider the financial, operational and legal implications before proceeding.
Looking Ahead
The BNG regime continues to evolve. Further reforms are expected, including changes to the spatial risk multiplier and the integration of Local Nature Recovery Strategy areas into biodiversity unit calculations. In addition, BNG requirements will apply to nationally significant infrastructure projects from November 2026, potentially increasing demand for off-site units. At the same time, the new small sites exemption may reduce demand in other parts of the market.
What remains clear is that biodiversity considerations are now firmly embedded within the development process. While the latest reforms provide welcome flexibility for many smaller schemes, developers and landowners alike should continue to engage with BNG requirements early to manage risk, identify opportunities and avoid delays as the regime continues to mature.
If this is something you need advice on, please reach out to our Property Litigation team.