Biodiversity Net Gain is a mandatory requirement for most planning applications in England, fundamentally changing how development interacts with the natural environment. Introduced under the Environment Act, the BNG system requires developments to deliver a minimum ten per cent net gain in biodiversity, measured using biodiversity units.
At the heart of this system sits the mitigation hierarchy, which requires developers to prioritise avoiding harm to biodiversity before considering compensation. This article explains the BNG mitigation hierarchy in practice, covering on-site delivery, off-site biodiversity units and statutory biodiversity credits, and how each option is assessed through the planning application process.
Biodiversity net gain and the mitigation hierarchy explained.
Biodiversity Net Gain (BNG) requires development to leave biodiversity in a measurably better state than before, delivering at least a 10% net gain secured through the planning process.
It is important to distinguish between two related but separate hierarchies:
- The NPPF mitigation hierarchy applies to planning decisions where there is significant harm to biodiversity. As set out in the National Planning Policy Framework (NPPF), it follows the long-established sequence of avoid, mitigate, then compensate as a last resort.
- The Biodiversity Gain Hierarchy, explained in the GOV.UK BNG guidance, applies specifically to the statutory BNG framework and the discharge of the Biodiversity Gain condition. It is set out in Articles 37A and 37D of the Town and Country Planning (Development Management Procedure) (England) Order 2015.
Under the Biodiversity Gain Hierarchy (which does not apply to irreplaceable habitats), developers must first avoid adverse effects on medium, high and very high distinctiveness onsite habitats (and mitigate where avoidance is not possible). Any remaining losses must then be addressed in a defined order: enhancement of existing onsite habitats, creation of new onsite habitats, allocation of registered offsite gains (i.e. biodiversity units), and finally the purchase of statutory biodiversity credits.
Local planning authorities must consider how this hierarchy has been applied when determining whether to approve a Biodiversity Gain Plan. In summary, the NPPF mitigation hierarchy governs how significant biodiversity harm is considered in planning decisions, whereas the Biodiversity Gain Hierarchy is a statutory mechanism designed specifically to secure and evidence the required biodiversity net gain.
On-site biodiversity net gain as the preferred approach
On-site delivery sits at the top of the BNG hierarchy and is always the preferred option. Developers are expected to prioritise the avoidance and minimisation of biodiversity impacts through careful project design, site selection and layout decisions. Where impacts are unavoidable, habitat enhancement or habitat creation should ideally be delivered within the red line boundary of the site.
On-site biodiversity net gain delivers clear ecological benefits. It keeps biodiversity improvements within the local area. For this reason, local planning authorities typically favour on-site solutions where they are feasible and deliverable.
On-site measures may include enhancement of existing habitats, creation of new habitat types such as grassland or native scrub planting, or improvements to linear habitats such as hedgerows and watercourses. These proposals must be clearly documented within a biodiversity gain plan, supported by evidence, monitoring arrangements and long-term management commitments, if this is deemed by the Local Planning Authority to be required.
Off-site biodiversity units and the private market
Where a development cannot deliver sufficient net gain on site, the mitigation hierarchy allows for off-site biodiversity units to be used. Off-site options involve securing biodiversity units on land outside the development boundary, through habitat banks or agreements within the private market.
Off-site biodiversity units must meet strict requirements. Habitat types must be appropriate, deliver genuine biodiversity enhancement/creation and be legally secured for the required period. A spatial risk multiplier is applied where biodiversity units are delivered further from the development site, reflecting the increased ecological risk of distance.
DEFRA provides detailed guidance on off-site delivery, including spatial risk, habitat distinctiveness and unit calculations, within its BNG implementation guidance. This ensures off-site biodiversity does not undermine local ecosystems or planning objectives.
Statutory biodiversity credits as a last resort
Statutory biodiversity credits sit at the bottom of the mitigation hierarchy and should only be used where on-site and off-site options are demonstrably unavailable or insufficient. Developers must evidence why alternative solutions cannot be delivered before seeking to purchase statutory credits.
Statutory credits are sold by the government and administered by Natural England, with funds used to support strategic habitat creation at a national level. The rules around statutory credit prices, purchasing and availability are set out in Natural England’s guidance on statutory biodiversity credits.
These credits do not provide bespoke compensation linked to a specific development or local authority area, for every one unit required, a developer must purchase two statutory credits. As a result, statutory credits are typically less attractive than on-site or off-site solutions, both ecologically and financially.
Applying the hierarchy through the planning process
Local planning authorities are responsible for ensuring the mitigation hierarchy is followed. During the planning application process, applicants must demonstrate how they have prioritised avoidance, on-site enhancement and off-site options before resorting to statutory credits.
Planning authorities assess biodiversity gain plans alongside planning applications to ensure compliance with national policy, local planning requirements and local nature recovery strategies. Failure to justify the chosen approach can delay determination or lead to refusal of planning permission.
The Planning Practice Guidance reinforces that biodiversity net gain should be integrated early into project design and decision-making, rather than treated as an afterthought.
Why early strategy and evidence are critical
Effective BNG delivery depends on early engagement and robust evidence. Understanding baseline habitats, biodiversity impacts and site constraints at the outset allows developers to avoid unnecessary reliance on off-site units or statutory credits and/or be made aware early that achieving gains on-site is not a possibility.
A well-considered mitigation strategy reduces planning risk, controls costs and delivers genuine environmental enhancement.
Conclusion
The BNG mitigation hierarchy is central to delivering biodiversity net gain in England. By prioritising on-site enhancement, using off-site biodiversity units where necessary and treating statutory biodiversity credits as a last resort, developers can meet planning requirements while contributing positively to the environment.
For developers, landowners and planning professionals navigating the complexities of biodiversity net gain, Civity provides expert support across the full BNG system. From early strategies to biodiversity gain plans and implementation, their team helps ensure development proposals are compliant, evidence-led, and environmentally robust.
Disclaimer
This article is intended as general guidance only and reflects biodiversity net gain legislation and government guidance in England at the time of writing. Requirements may vary depending on development type, location and local planning authority interpretation. Professional ecological and planning advice should always be sought before making decisions.
