Nutrient Neutrality payments still available based on water catchment priority areas
Changes proposed to the Levelling Up and Regeneration Bill announced on the 29th August by the Government, may have a significant impact for both the Nutrient Mitigation market and farmers in general.
The Government intends to boost housebuilding by removing ‘red tape’ currently holding back the granting of planning permission in some of the most vulnerable catchment areas.
The reasoning is that new homes are considered to have less of an impact on nutrient pollution than other sources and that this neutrality policy was disproportionate as a solution considering its impact on new development. Developers in vulnerable catchments will no longer have to show specific mitigation proposals as part of a planning application but may instead have to contribute to the Nutrient Mitigation Scheme (NMS) run by Natural England.
Nutrient Neutrality (NN) will still require land from farmers and landowners, but for a narrower group, focusing on site restoration of habitats and species in specific areas and certain priority areas. These will likely involve large-scale nature-based projects such as wetlands.
Most farmers around the country will be affected in some form by this Bill, as it would see an increase in regulation as a means of reducing the country’s nutrient pollution. There will be additional site inspections with a stated figure of at least 4,000 per year to check nutrient compliance. To assist with this burden there will be an increase in funding for grants for slurry management, precision spreading equipment and other measures to reduce run-off.
One opportunity arising from these amendments will be the introduction of ‘payment premiums’ for land in high priority areas to encourage uptake of certain Environmental Land Management (ELM) actions. Farmers in these areas will now have the option of either entering land into a long-term agreement with Natural England, likely to involve a major change of land use or more short-term flexible agreement under ELMs.
Whether you should consider an NMS would depend on various factors as this market will likely take the form of the current Water Abstraction Licence market, with Natural England taking the place of the Environment Agency as the relevant authority dealing with this particular type of issue. From our experience with Nutrient Mitigation and Abstraction Licences, this may be an involved process needing specialist advice.
Removing requirements on NN based on remnant EU law, in theory will allow for the creation of wide-ranging bespoke solutions to nutrient pollution that are tailored to each individual catchment, rather than ad hoc sites trying to offset specific developments. Whether an overstretched Natural England will be able to deliver these projects is another matter and this policy in some ways allows developers to ‘get away with it’ whilst placing the regulatory burden on farmers and the cost onto the taxpayer.
Success will now also depend on whether farmers will find what Natural England will offer attractive enough for there to be an effective uptake and delivery.
At the time of writing, the suggested amendments are still to pass through Parliament which leaves the future of NN very much still up in the air as to how things will change or not. In spite of this private trading of NN units may well still be an alternative to avoid the current uncertainty of the cost and further delay to developers until the Government has concluded their revision of their approach to NN. Following this revision private trading of NN units may also remain an attractive option, price and timing wise, for certain developers and landowners doing their own development projects.
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