The Planning and Infrastructure Act received Royal Assent yesterday, ushering in a new chapter as to how developers can meet their environmental responsibilities. The most immediate impact will be on Nutrient Neutrality for developments within certain sensitive catchments and this will create new opportunities for landowners to enter these ‘Nature Markets’ by providing mitigation measures.
Planning and Infrastructure Act
The key aspects of the Act are to:
1. Streamline the process for Nationally Significant Infrastructure Projects (NSIPs)
- Secretary of State is given the power to direct projects outside of the development consent process and;
- introduces a faster procedure for legal challenges
This is hugely positive and will have big implications for other Nature Markets especially Biodiversity Net Gain as it is expected that significant demand for BNG Units will come from such projects. The quicker and more efficient this process is, the more approved developments there will be and therefore a quicker increase in the expected significant level of demand for BNG units.
2. A more joined up planning system
- Introduces strategic planning at a sub-regional level through Spatial Development Strategies (SDS), to facilitate effective cross-boundary working in some area.
This will facilitate planning and achieving Governmental targets, likewise, again increasing demand for BNG Units.
3. Growth and nature recovery as one
- Measurement of impact of new homes, clean energy, sustainable food, healthy soil, clean water and air, resilience to climate change and access to greenspaces.
- Unlock sustainable development introducing tools such as new digital systems.
4. Introduce The Nature Restoration Fund (NRF) and Environmental Delivery Plans (EDPs).
The Nature Restoration Fund
It is this last point, the NRF and EDP that has particular significance. When an EDP is set up in a specific area, developers can choose to pay a levy to meet environmental obligations with payments from multiple developments being pooled to deliver conservation measures at scale. This does not include BNG.
These EDPs are expected to be voluntary for the most part, and developers can choose whether to opt for their development to utilise it where the environmental obligation is not mandatory. This allows them to still seek credits or alternative suitable solutions themselves in the open market, where available.
NRF is expected to expand over time to encompass other ecological areas, but Nutrient Neutrality (NN) will be the initial focus.
Where a landowner is in a vulnerable catchment they may want to consider applying to put appropriate land in a relevant scheme, payments are likely to be bespoke depending on what is being implemented.
Implications for existing NN schemes
The good news is that current private and third sector providers can continue selling credits directly to developers who can then propose bespoke mitigation plans for their development under the existing system. As we do not know exactly what payment rates one would expect for the new scheme, many would want to continue in this fashion whereby one can negotiate on prices.
Natural England’s own original Nutrient Mitigation Scheme they run, in order to provide their own units, will transition to the NRF.
There are a range of current approaches within LPAs and there is some uncertainty on whether Local Authorities’ own nutrient mitigation schemes will continue or choose to transition to the NE led system; essentially it will be for them to discuss with Natural England and decide how to proceed.
Timeframe
Currently engagement with all stakeholders on where the first EDPs will be created is subject to public consultation. Secondary legislation will need to be drafted as, whilst the Planning and Infrastructure Act provides the core legal framework, secondary legislation will be needed to add further detail how the levy will operate and charging schedules.
During the Spring and Summer of 2026, the NRF digital service will be tested and the secondary legislation will be put before parliament. A formal consultation will be held, first for nutrient pollution in EDPs with subsequent consultations to follow expanding into other relevant environmental considerations/areas. Support for LPAs and developers will be provided.
The first EDPs will go live once all this has been worked through and then approved by the Secretary of State which may, with a fair wind, be by the end of 2026.
If you are considering a NN mitigation project or are part way through setting one up, we would recommend progressing as having this in place before the NRF reaches your catchment gives you more options on how to manage sales of credits.