A different route for meeting targets
Under regulations introduced in 2024, most developers in England need to deliver a 10 % net biodiversity uplift( known as Biodiversity Net Gain, or BNG) from their projects; in other words, they need to ensure their development results in more, or better quality, natural habitat than there was before the development. That’ s not always easy to achieve, particularly on the site itself, but markets are opening up for the creation of off-site habitats that support meeting BNG obligations for new developments.
These areas of high value habitats- often referred to as“ habitat banks”- can include all sorts of landscapes and environments, including meadows, hedges, ponds and riverbanks, woodland and scrub. They are registered with national databases and managed on an ongoing basis in order to boost biodiversity. The habitats generate BNG units, which can then be sold to housing developers who can’ t meet the 10 % uplift requirement onsite. This allows developers to focus on the building of those all-important houses whilst the specialists in habitat creation ensure that we build a nature-positive future.
BNG habitats in action
Two years have passed since the regulations were introduced, and it’ s become clear during that time that BNG habitat banks are increasingly important to developers of both new homes and commercial buildings and also to the big infrastructure projects that are going to fuel our economy in the future.
We have seen this firsthand at Atom through our close working with BNG Partnership to identify and finance the conversion of lower-quality land into diverse habitats in areas of high housing demand. To date, Atom has supported the purchase and transformation of three sites in Cambridgeshire, North Northamptonshire and Hampshire over a combined 81 hectares. The habitats
created across these sites have generated enough BNG units to support the building of 2,410 new homes, with more to come.
Based on this experience we have now developed and rolled out a full Natural Capital proposition, providing loans for the purchase or refinance of land which will be used to create BNG units.
Doing the right thing
Increasing housing delivery, providing mortgages for people to get onto the housing ladder and supporting the environment should not be seen as competing aims. As an industry, we should aspire to produce the homes the next generation of homeowners so clearly needs, but not at the cost of the natural world.
If we are to see a greater rate of housing development, then we need innovative new ways for developers to meet their environmental obligations, such as the creation of BNG habitat banks. BNG units won’ t be right for every developer or for every project, but their importance is only going to grow from here.
There is a real opportunity here for brokers to act as educators both to their developer clients but also those clients with underperforming land which could be converted into BNG habitat banks. Now is the time to get to grips with this emerging market, and play our part in boosting the health of both the housing market and the environment; working together on this one we can, as Mark Twain said, truly gratify some people and astonish the rest.
Learn more
Visit the Atom Bank website to discover how they are making the experience of borrowing and saving faster, easier.
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