England will soon introduce one of the world’s most ambitious biodiversity policies in “Biodiversity Net Gain”.
This policy effectively mandates that any new development leaves biodiversity in a better state than before it was constructed. It was initially meant to go into effect in November, but the government has pushed back its implementation until 2024.
In order to understand the potential impacts of the Biodiversity Net Gain, our team has been tracking development projects approved over the last three years in six councils across England that were early adopters of the policy.
Our latest paper, published this month, reveals several fundamental challenges that threaten the integrity of the policy’s environmental and economic outcomes.
We find that the oversight, monitoring and enforcement of biodiversity improvements supposedly delivered under the policy need urgent attention.
For example, there is a clear “governance gap”, where the system for monitoring biodiversity gains delivered on the site of new developments is weaker than for gains purchased from elsewhere. The process is overseen by local planning departments, which are typically lacking in capacity and ecological expertise.
Biodiversity Net Gain is an essential pillar of the country’s plans for attracting private finance into nature conservation to achieve its overarching environmental objectives.
Ultimately, the challenges we identify threaten the integrity of one of England’s most important environmental markets – and with it, the environmental outcomes of the government’s nature markets strategy.
Biodiversity Net Gain
Under the Biodiversity Net Gain policy, developers have three ways to offset their “biodiversity liability” – the damage their project does to nature. Biodiversity Net Gain applies to most developments, such as housing and smaller infrastructure projects. The policy will apply to major infrastructure projects from 2025 onwards.
First, they can enhance biodiversity somewhere within the development – so-called “on-site” gains. These on-site gains can take the form of, for example, sowing wildflowers along road verges or managing some of the grassland within a housing development to promote wildlife, rather than for traditional landscaping.
If developers can’t meet their liabilities on-site, their second option is to use biodiversity “units” from ecological improvements elsewhere. Under the policy, these units are supposed to mirror the habitat that is impacted by the development, so that when developers damage habitats, they must replace them with habitats that are at least as valuable, from a conservation perspective, as those lost.
Some of these units might come from the new “net-gain market”. Land managers create these units by implementing conservation actions on their land, such as converting low-productivity pasture into a field managed for wildflowers. Then, they sell these units to developers.
Alternatively, some developers are developing their own habitat banks, creating biodiversity units in one place to offset the impacts of their developments elsewhere.
Last, if no units are available through either of these pathways, developers can buy “statutory biodiversity credits” directly from the national government.
These credits loosely resemble the units sold via the market. The government holds a stock of these units as a last resort for developers who cannot offset their damage in other ways. For example, they may offset damage to particularly rare types of habitat for which there may not be suitable credits available on the standard market.
Importantly, the price levels for these statutory units have been set deliberately high, in an attempt to disincentivise developers from relying on these credits.
The ‘governance gap’
Our dataset spans around 1,600 hectares of development footprint that have been submitted or approved for development over the last three years in these six early-adopter councils: West and South Oxfordshire, Vale of White Horse, Cornwall, Leeds City and Tunbridge Wells.
Our team has been collating and analysing the biodiversity assessments submitted to these authorities for each project.
We’ve analysed the trades occurring under the policy and the rules that govern them. Additionally, we have quantified any errors embedded in the developers’ biodiversity assessments. Our research has identified several shortfalls that need addressing for this nature market to be able to deliver on its goals.
Our first key finding is that around one-quarter of all the biodiversity units delivered under the policy so far fall within a “governance gap” – meaning that they are likely to go unmonitored, and may even be legally unenforceable.
As a result, there is a very high probability that regulators will not be able to take any action if these promised gains are not delivered.
This will likely translate into a large chunk of these units not materialising in reality, as there is little incentive for developers to deliver these units in full if there is no credible enforcement mechanism.
The problem is that the standards and regulations of the three offset pathways vary considerably.
There is reasonably stringent governance to ensure that biodiversity units purchased on the offsetting market are delivered in reality. Sellers will have to submit their offsets to a national database, monitor biodiversity changes and report on the ecological development of the site at regular intervals.
Contrary to these standards, the system for monitoring, reporting and enforcing units delivered “on-site” is much weaker. The government has suggested that the existing planning enforcement system can be used to oversee on-site units.
The planning enforcement system was never designed for such a task, and in its current form, is unsuitable for fulfilling this role.
Under the current system, local authorities are explicitly advised to only take enforcement action, such as warnings or fines, if a developer’s violation of a planning condition results in “serious harm to a local public amenity”. Although it is unclear how this will apply to the Biodiversity Net Gain policy, the failure to deliver a habitat that a developer promised in a planning application a few years prior is extremely unlikely to trigger this threshold.
Developers also do not have to log their on-site gains on the national Biodiversity Net Gain register, which means that many of these projects are likely to go unmonitored. Even if they underperform relative to the original promise in the planning application, there is no credible system in place to hold developers to account for such non-delivery.
Risk of non-delivery
In our research, we have found that around one-quarter of all the units delivered under the policy are at a high risk of non-delivery because of this governance gap.
While the regulation of a specific kind of biodiversity unit within a single policy might sound unimportant, this actually has serious implications for how England’s nature markets function.
The core pillar of England’s ambitions for drawing private finance into nature conservation is the Biodiversity Net Gain market. Any biodiversity units that are delivered on-site by developers are units they will not need to purchase from the off-site market. So the less stringent the standards in the on-site system, the more this will drain demand for units from the off-site market, which is relatively more ecologically robust.
Although we recognise our data is preliminary, we estimate that if these under-regulated biodiversity units were to be delivered via the off-site market instead, the demand for biodiversity units could rise by a factor of four.
This could significantly increase the amount of conservation implemented on private land and, therefore, the amount of private finance flowing into conservation projects on private land.
There is precedent for this. The English scheme was partially informed by the US wetland mitigation markets. In 2008, those markets underwent reform to address a similar governance gap.
In the US case, the standards applied to developer-led and third-party projects diverged enormously, meaning a range of low-quality mitigation projects were being implemented by developers. The 2008 compensation rule in the US wetland mitigation system addressed this disparity by ensuring that the same standards were applied across all forms of compensation.
Lacking capacity
Our research also reveals other interesting, consequential patterns. Perhaps the most important to the integrity of this emerging market is the current lack of capacity in local authorities to be able to deliver on the Biodiversity Net Gain policy.
Local authorities do the best they can with the resources they have, but they have undergone stringent funding cuts since 2008.
At the last count, around 60% of local planning authorities have no in-house ecological expertise – which is essential for delivering biodiversity gains effectively.
In our study, we evaluated how many of the applications contained a basic error in their calculations: we checked to see if the area of the site before and after development added up to the same amount.
We found that the areas did not add up in around one-fifth of all projects. Of these, around half had already been accepted by the local planning authorities. One explanation for this oversight could be that planners were so rushed they did not have time to examine the calculations included with the application.
This suggests we have not yet addressed the serious capacity shortages in the councils – who are ultimately going to be the public bodies overseeing the delivery of Biodiversity Net Gain at local scales. This is clear evidence that further investment in local planning capacity is required.
Environmental markets have the potential to be powerful mechanisms for improving nature, but one of the fundamental features of biodiversity compensation markets is that they deliver biodiversity gains that make up for an equal and opposite loss elsewhere.
This means that every biodiversity unit that is promised by developers in order to secure planning permission, but then not delivered in reality, has legitimised the loss of biodiversity elsewhere.
Making sure that these policies lead to direct, robust gains in the quality of nature is therefore absolutely essential to ensure that the markets-focused approach to drawing private finance into nature recovery in England leaves the environment better, rather than worse, off.
The post Guest post: Fixing the gaps in England’s ‘biodiversity net-gain’ policy appeared first on Carbon Brief.
Guest post: Fixing the gaps in England’s ‘biodiversity net-gain’ policy
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Lena Luig is the head of the International Agricultural Policy Division at the Heinrich Böll Foundation, a member of the Global Alliance for the Future of Food. Anna Lappé is the Executive Director of the Global Alliance for the Future of Food.
As toxic clouds loom over Tehran and Beirut from the US and Israel’s bombardment of oil depots and civilian infrastructure in the region’s ongoing war, the world is once again witnessing the not-so-subtle connections between conflict, hunger, food insecurity and the vulnerability of global food systems dependent on fossil fuels, dominated by a few powerful countries and corporations.
The conflict in Iran is having a huge impact on the world’s fertilizer supply. The Strait of Hormuz is a critical trade route in the region for nearly half of the global supply of urea, the main synthetic fertilizer derived from natural gas through the conversion of ammonia.
With the Strait impacted by Iran’s blockades, prices of urea have shot up by 35% since the war started, just as planting season starts in many parts of the world, putting millions of farmers and consumers at risk of increasing production costs and food price spikes, resulting in food insecurity, particularly for low-income households. The World Food Programme has projected that an extra 45 million people would be pushed into acute hunger because of rises in food, oil and shipping costs, if the war continues until June.
Pesticides and synthetic fertilizer leave system fragile
On the face of it, this looks like a supply chain issue, but at the core of this crisis lies a truth about many of our food systems around the world: the instability and injustice in the very design of systems so reliant on these fossil fuel inputs for our food.
At the Global Alliance, a strategic alliance of philanthropic foundations working to transform food systems, we have been documenting the fossil fuel-food nexus, raising alarm about the fragility of a system propped up by fossil fuels, with 15% of annual fossil fuel use going into food systems, in part because of high-cost, fossil fuel-based inputs like pesticides and synthetic fertilizer. The Heinrich Böll Foundation has also been flagging this threat consistently, most recently in the Pesticide Atlas and Soil Atlas compendia.
We’ve seen this before: Russia’s invasion of Ukraine in 2022 sparked global disruptions in fertilizer supply and food price volatility. As the conflict worsened, fertilizer prices spiked – as much from input companies capitalizing on the crisis for speculation as from real cost increases from production and transport – triggering a food price crisis around the world.
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Since then, fertilizer industry profit margins have continued to soar. In 2022, the largest nine fertilizer producers increased their profit margins by more than 35% compared to the year before—when fertilizer prices were already high. As Lena Bassermann and Dr. Gideon Tups underscore in the Heinrich Böll Foundation’s Soil Atlas, the global dependencies of nitrogen fertilizer impacted economies around the world, especially state budgets in already indebted and import-dependent economies, as well as farmers across Africa.
Learning lessons from the war in Ukraine, many countries invested heavily in renewable energy and/or increased domestic oil production as a way to decrease dependency on foreign fossil fuels. But few took the same approach to reimagining domestic food systems and their food sovereignty.
Agroecology as an alternative
There is another way. Governments can adopt policy frameworks to encourage reductions in synthetic fertilizer and pesticide use, especially in regions that currently massively overuse nitrogen fertilizer. At the African Union fertilizer and Soil Health Summit in 2024, African leaders at least agreed that organic fertilizers should be subsidized as well, not only mineral fertilizers, but we can go farther in actively promoting agricultural pathways that reduce fossil fuel dependency.
In 2024, the Global Alliance organized dozens of philanthropies to call for a tenfold increase in investments to help farmers transition from fossil fuel dependency towards agroecological approaches that prioritize livelihoods, health, climate, and biodiversity.
In our research, we detail the huge opportunity to repurpose harmful subsidies currently supporting inputs like synthetic fertilizer and pesticides towards locally-sourced bio-inputs and biofertilizer production. We know this works: There are powerful stories of hope and change from those who have made this transition, despite only receiving a fraction of the financing that industrial agriculture receives, with evidence of benefits from stable incomes and livelihoods to better health and climate outcomes.
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Inspiring examples abound: G-BIACK in Kenya is training farmers how to produce their own high-quality compost; start-ups like the Evola Company in Cambodia are producing both nutrient-rich organic fertilizer and protein-rich animal feed with black soldier fly farming; Sabon Sake in Ghana is enriching sugarcane bagasse – usually organic waste – with microbial agents and earthworms to turn it into a rich vermicompost.
These efforts, grounded in ecosystems and tapping nature for soil fertility and to manage pest pressures, are just some of the countless examples around the world, tapping the skill and knowledge of millions of farmers. On a national and global policy level, the Agroecology Coalition, with 480+ members, including governments, civil society organizations, academic institutions, and philanthropic foundations, is supporting a transition toward agroecology, working with natural systems to produce abundant food, boost biodiversity, and foster community well-being.
Fertilizer industry spins “clean” products
We must also inoculate ourselves from the fertilizer industry’s public relations spin, which includes promoting the promise that their products can be produced without heavy reliance on fossil fuels. Despite experts debunking the viability of what the industry has dubbed “green hydrogen” or “green or clean ammonia”, the sector still promotes this narrative, arguing that these are produced with resource-intensive renewable energy or Carbon Capture and Storage (CCS), a costly and unreliable technology for reducing emissions.
As we mourn this conflict’s senseless destruction and death, including hundreds of children, we also recognize that peace cannot mean a return to business-as-usual. We need to upend the systems that allow the richest and most powerful to have dominion over so much.
This includes fighting for a food system that is based on genuine sovereignty and justice, free from dependency on fossil fuels, one that honors natural systems and puts power into the hands of communities and food producers themselves.
The post Middle East war is another wake-up call for fossil fuel-reliant food systems appeared first on Climate Home News.
Middle East war is another wake-up call for fossil fuel-reliant food systems
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