Greening the grey In England, Plymouth City Council became the first local authority to establish a Habitat Bank under its Ocean City Nature⁴ scheme, designed to help local developers meet their obligations under the new rules. Improvements to three initial sites totalling 109 hectares at Cann Woods, Ham Woods and Chelson Meadow are expected to generate biodiversity units worth GBP 7.4 million over 30 years. This would result in a net benefit to the council of GBP 187,000 per year over 30 years, after accounting for habitat management costs. Other local authorities have followed suit, registering approximately 680 hectares⁵ of habitat creation or enhancement in the year following the rules’ implementation. With more investors, landowners and organisations getting involved, the market for biodiversity units could grow to between GBP 135 million and GBP 274 million per year⁶, according to projections in a report commissioned by the Department for Environment, Food and Rural Affairs. Progress in England’s pioneering market for biodiversity units will, to some extent, be influenced by how rapidly landowners can access the expertise needed to identify the scale of the opportunity and the potential market that could be unlocked through the BNG process. The first step towards creating a habitat bank and selling biodiversity units involves identifying the existing state of Biodiversity by the numbers 10% 4% minimum mandatory uplift in biodiversity post project development for 30 years; Sutton case shows 171% biodiversity net gain. With net gains above 10% used to offset future projects of England’s total area (5,261 km2) – and growing - is currently applying BNG
Compliance and climate challenges
current habitats, then conducting a baseline ecological survey and condition assessment of any potential land that could be registered as a gain site. Owners can then start scoping viable enhancement options and then run the baseline data and improvement plan through the statutory metric to ascertain how many units the site could generate. Just a few examples of the many possible approaches include thinning non-native tree species or clearing invasive or dominant single-species areas to allow a greater diversity of plants to establish themselves. New habitats can be created, such as by sowing wildflower meadows, digging new ponds, or planting trees to establish new woodlands. Blue-green infrastructure⁷ approaches can be used as alternatives to traditional engineering options in urban areas to “green the grey” and support pollinating insects, for example. Sometimes the potential gains can go far beyond the 10 percent required in the Environment Act. In the London Borough of Sutton, a case study⁸ from the consultancy Aspect Ecology suggests that plans to plant more than 300 trees and develop green roofs, shrubs, gardens and other green spaces at a development of 970 new homes and adjacent commercial property will generate a biodiversity net gain of 171 percent. All net gains above the minimum 10 percent requirement represent units that could be used to offset the developer’s other projects or sold to other developers requiring off-site gains. £7.4M $2B value over 30 years. Benefit to council of £187,000 per year over 30 years Plymouth: 109 hectares Global biodiversity market projections (WEF): $2B (2030), $69B (2050)
Once a landowner has decided to proceed with managing their land as a habitat bank, they must legally secure the land and commit to managing the enhancements for a minimum of 30 years. They must then develop a habitat monitoring and management plan for approval by the Local Planning Authority and register the land parcels as Habitat Banks on the Natural England National Biodiversity Gain Sites Register. Assuming the application is approved, the units will be added, and the landowner can then seek out developers who need them to meet their 10 percent biodiversity net gain obligations. Recent examples of local authorities taking advantage of the system include Hartlepool Borough Council in northeast England. The council has collaborated⁹ with the Environment Bank, a leading developer of biodiversity units, and local tenant farmers to produce a supply of 100 off-site biodiversity units. These units will help developers meet the projected demand for 1,000 new homes in the area each year. One of the biggest challenges for local planning authorities may lie in implementing the monitoring and enforcement processes needed to ensure that enhancement pledges are honoured. Critics point out that there is, as yet, no clearly defined process for compliance monitoring, raising the risk 10 that commitments to manage habitats in specific ways over 30-year periods could fall by the wayside. That would render any projected biodiversity enhancements, and payments made for them, meaningless. This governance gap could make the system “unenforceable”, a study 11 published in 2021 warned. The authors also found widespread disagreement among surveyors over habitat classifications, leaving significant scope for bias or error. Fifteen months after BNG became mandatory, it would be interesting to collate experience from ecologists conducting baselining to see if this is reflected in the reality of implementing the process. Perhaps some of this may surface through the recently closed consultation process 12 . Momentum for change While such concerns will linger, the BNG process reflects broader ambition and momentum towards more sustainable development and protection, restoration, and enhancement of the environment. By 2030, the UK Green Building Council, a group comprising developers and more than 20 local authorities, aims to have all new buildings and infrastructure designed to be climate-resilient and to maximise environmental net gains throughout their lifetimes, including through the prioritisation of nature-based solutions. The scope for landowners to realise value under the new regulations – and the potential for environmental benefits – appears likely to grow.
References 1. Department for Environment, Food & Rural Affairs. “Understanding biodiversity net gain.” GOV.UK. 2025. https://www.gov.uk/guidance/understanding-biodiversity-net-gain 2. World Economic Forum in collaboration with McKinsey & Company. “Biodiversity Credits: Demand Analysis And Market Outlook Insight Report.” World Economic Forum. 2023. https://www3.weforum.org/docs/WEF_2023_Biodiversity_Credits_Demand_ Analysis_and_Market_Outlook.pdf 3. Convention on Biological Diversity. n.d. “Target 19: Mobilise $200 Billion per Year for Biodiversity From all Sources, Including $30 Billion Through International Finance.” Convention on Biological Diversity. Secretariat of the Convention on Biological Diversity. https://www.cbd.int/gbf/targets/19 4. Ocean City Nature. n.d. “Bringing benefits for people and wildlife in Plymouth.” https://www.oceancitynature.co.uk/ 5. Ben Stansfield. “Biodiversity Net Gain - how might new proposals evolve the current regime?” Gowling WLG. 2025. https://gowlingwlg.com/en-ca/insights-resources/articles/2025/biodiversity- net-gain---how-might-new-proposals-evolve-the-current-regime?.com 6. Department for Environment, Food & Rural Affairs and Economics for the Environment Consultancy Ltd (eftec). “Biodiversity Net Gain: Market analysis study.” London, UK. 2021. 8. Poulton, Jon. “February 2024: Case Study - Delivering Significant (>150%) Biodiversity Net Gain in Greater London.” Aspect Ecology. February 28, 2024. https://aspect-ecology.com/january-2024-biodiversity-net-gain-to- become-mandatory-from-12-february-2024-copy 9. Environment Bank. “BNG Habitat Bank in partnership with Hartlepool Council.” Environment Bank. 2025. https://www.environmentbank.com/case-studies/bng-habitat-bank-in- partnership-with-hartlepool-council/ 10. National Audit Office (NAO) UK. “Risks to the long-term effectiveness of new biodiversity net gain scheme.” 2024. https://www.nao.org.uk/press-releases/risks-to-the-long-term-effectiveness- of-new-biodiversity-net-gain-scheme/ 11. Zu Ermgassen, Sophus O., Sally Marsh, Kate Ryland, Edward Church, Richard Marsh, and Joseph W. Bull. “Exploring the Ecological Outcomes of Mandatory Biodiversity Net Gain Using Evidence from Early adopter Jurisdictions in England.” Conservation Letters 14 (6). The Society for Conservation Biology. 2021. https://doi.org/10.1111/conl.12820 https://randd.defra.gov.uk/ProjectDetails?ProjectId=20608 7. GreenBlue Urban. “Why Green and Blue?” January 9, 2023. https://greenblue.com/ce/about-us/why-green-and-blue/ 12. Department for Environment, Food & Rural Affairs, UK. “Improving the implementation of biodiversity net gain for minor, medium and brownfield development.” GOV.UK. May 28, 2025. https://www.gov.uk/government/consultations/improving-the- implementation-of-biodiversity-net-gain-for-minor-medium-and-brownfield- development
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