The Environment Bill received Royal Assent on 9 November 2021, becoming the Environment Act 2021 (the Act) after a parliamentary process of almost two years. The Act sets out the UK's post-Brexit environmental protection framework against the backdrop of the closing of COP26 and an increasing focus on the role that the planning system can play in tackling the climate crisis.
The Act comprises 'two thematic halves' comprising a legal framework for environmental governance and provisions for specific improvement of the environment in respect of air quality, water, biodiversity, resource efficiency and waste reduction. This article deals with one aspect for each of the 'thematic halves'.
Environmental governance: a new regulator
The Act establishes the Office for Environmental Protection (OEP) as a new regulator. The main objective for the OEP is to contribute to environmental protection and the improvement of the natural environment. The OEP has not been granted direct functions in relation to the protection of the environment; instead, the OEP has been granted scrutiny and advice functions, and enforcement functions to monitor the compliance of public bodies with environmental law.
Enforcement functions granted to the OEP relate to "failures by public authorities to comply with environmental law". The three main enforcement functions are (a) considering complaints and carrying out investigations; (b) environmental review proceedings; and (c) applying for, and intervening in claims for judicial review. The OEP can investigate matters either pursuant to a complaint or of its own motion.
If it concludes that a public authority has failed to comply with environmental law and the failure is serious, the OEP can issue a decision notice to the same effect (although this is not binding). The OEP may subsequently apply to the High Court for an environmental review. Significantly there is no time limit for the bringing of an environmental review claim. Under the Act, the court should apply "the principles applicable on an application for judicial review". The primary remedy available is a "statement of non-compliance" but the court may grant any remedy available to a judicial review other than damages, subject to the satisfaction of conditions specified in the Act regarding prejudice to third parties.
The regulator is required to publish a strategy setting out how it intends to exercise its functions, and on its website the OEP indicates that it expects to seek views on the strategy, prior to finalising and publishing it, in early 2022.
Environmental improvement: biodiversity net gain for new development
The Act seeks to address the effects of climate change on biodiversity. It introduces a 10 per cent biodiversity net gain requirement for all new developments in England, although this would not take effect until the issue of further regulations which are not expected until 2023. In practical terms, the intention is for planning permissions (subject to exceptions) in England to be deemed to include a pre-commencement condition requiring a biodiversity gain plan to be submitted to and approved by the relevant planning authority. DEFRA and Natural England unveiled a new Biodiversity Metric 3.0 in July 2021, which, subject to further consultation and any further update, is expected to be the metric specified for mandatory biodiversity net gain.
Planning permissions granted by a development order and urgent Crown development will not be deemed to contain the pre-commencement condition, and the Secretary of State may make regulations in the future excluding further types of development.
DEFRA opened a consultation on biodiversity net gain regulations and implementation on 11 January 2022. The consultation document proposes to further exempt developments impacting habitat areas below a 'de minimis' threshold, householder applications and change of use applications. Exemptions for creation of biodiversity gain sites and self-build and custom housebuilding are also being considered. The 10 per cent net gain requirement does, however, extend to Nationally Significant Infrastructure Projects (albeit not via the same mechanism).
The Act also formalises conservation covenants (further enacting regulations are awaited), which are agreements between a landowner and a body to do or not do something on their land for a conservation purpose. Conservation covenants will be registrable as local land charges (and therefore bind landowners and their successors).
Biodiversity enhancements will need to be evidenced through: (a) the biodiversity value of the onsite habitat; (b) the biodiversity value of any registered offsite biodiversity gain allocated to the development; and/or (c) the purchase of biodiversity credits. On site habitat enhancements must be secured by planning condition, planning obligation or conservation covenants and be maintained for at least 30 years after the relevant development is completed. Off-site enhancements are to be secured under conservation covenants or planning obligations, in addition to being recorded in a "biodiversity gain site register" where the same minimum time-limit of 30 years applies.
The DEFRA consultation proposes that core biodiversity gain information will need to be submitted with planning applications, and that a finalised biodiversity net gain plan would need to be approved and completed before commencement, in order to discharge the deemed pre-commencement condition. For applications for outline planning permission and phased development, it is proposed that the applicant will be required to explain the strategy to achieve the biodiversity gain objective across the whole site and to demonstrate how this could be delivered on a phase-by-phase basis. These additional requirements will be set out in secondary legislation.
A new system of local nature recovery strategies, species strategies and protected site strategies is also introduced by the Act. The local nature recovery strategies are to include statements of biodiversity priorities for the relevant area, and local habitat maps which cover the area and identify nature conservation sites, nature reserves and areas which could become important for biodiversity. Relatedly, the Act also places a duty on local authorities to produce Biodiversity Reports every five years, detailing what action they have taken to comply with their duties. Strategies and Biodiversity Reports produced may in turn inform Local Plans.
Despite representing encouraging progress, the Act arguably does not go far enough, and is certainly not a 'silver bullet'.
The OEP's powers are limited. OEP recommendations are not binding, and the OEP does not have power to set aside, quash or undo the action in question, nor can it fine government bodies for failure to comply with environmental law. Furthermore, beyond statements of non-compliance, the court's ability to grant remedies is limited by the test stipulated in the Act which seeks to prevent remedies causing prejudice to third parties.
The biodiversity net gain requirement is also not immune from criticism. In particular, the Biodiversity Metric 3.0 has been criticised for the relative value it places on certain types of habitat. The metric operates through feeding information about a habitat, such as its type, size and condition, into an algorithm. The algorithm then outputs a number that defines how valuable the habitat is for biodiversity. The new metric does not value scrubby landscapes, which are often key features of rewilding projects. It instead logs such landscapes as a sign of 'degradation'. Furthermore, connectivity between habitats is not taken into account by the metric, with the result that small, disjointed areas for nature may be created.
What it means for the industry
The long-awaited Act is a significant piece of legislation that touches on many areas related to the environment, conservation and biodiversity. Developers will need to take this requirement into account for future projects, appreciating the nuance that a 10 per cent biodiversity gain on disused urban land will likely require much less enhancement than a 10 per cent gain on Green Belt land due to the different pre-development biodiversity unit measurements pre-existing on site. Additional engagement of specialist consultants may also be required prior to submitting planning applications.
Although further regulations are awaited, the biodiversity net gain requirement essentially aims to quantify the impact that development has on biodiversity and to regulate it through the planning system, presenting it with an opportunity to lead other sectors in achieving measurable improvements and preservation of the natural environment.
The OEP's enforcement functions present a potential opportunity to bring challenges to the grant of planning permissions outside of the existing statutory mechanisms, although the extent to which the OEP will be willing to involve itself remains to be seen.