Nutrient Neutrality and the Impact on Development
Following the "Dutch case" in 2018, the first time a national government had been required by its Court to take action against climate change, nutrient neutrality has become a hot topic with Natural England advising local authorities with protected water environments not to grant planning permissions unless the development can be proven to be "nutrient neutral". The impact of this advice on development in the Solent region and in Taunton have been widely reported.
In inland freshwater environments, such as the Somerset Levels, it is phosphates that are the issue and in coastal/marine areas, such as the Solent, it is nitrates. It is thought that the issue of proving development to be "nutrient neutral" will become more widespread through the country as Natural England issues advice to other local authorities with sensitive protected water environments.
In terms of the planning process in an affected area a Habitat Regulation Assessment (HRA) will be required for any relevant development. This requirement does not only apply at outline stage, it continues until the local planning authority had made the "implementing decision". The relevant local planning authority will be require a HRA:
- at outline stage;
- at reserved matters stage if no HRA was undertaken at outline stage;
- at reserved matters stage even if a HRA was undertaken at outline stage if there has been a material change in circumstances; and
- when discharging conditions on full or outline permissions, whether or not the conditions relate specifically to nutrients.
The HRA must be undertaken in consultation with Natural England who will need to be satisfied that the mitigation measures proposed will achieve nutrient neutrality.
So what might this mean for developers in development transactions?
- Developers must carry out sufficient due diligence and take technical advice as regards the impact of being in a "nutrient neutral area" or the likelihood of being in such an area.
- Will there be a move by developers away from unconditional acquisitions of land with the benefit of outline planning consent to acquisitions conditional on detailed consent or reserved matters approval on the basis of an acceptable HRA and mitigation measures?
- Developers may be more likely to seek to link agreed minimum prices to net developable acres rather than gross acres so as exclude land required for mitigation measures as well as for Biodiversity Net Gain.
- Developers may seek to increase the land they control to accommodate mitigation measures.
- Developers may seek additional rights over further land held by the seller.
- Where developers are already collaborating on larger sites, consideration will need to be given to the developing planning picture.
Some of the above are also relevant in respect of other emerging mitigation requirements such as Biodiversity Net Gain (particularly bullets 3 and 5).
So is this all fine and simply a matter of making the correct revisions to our contracts? Unfortunately not. The difficulty is that some mitigation proposals are very land hungry, such as the setting aside of productive land as fallow in order for it to process the nutrients to a neutral position. Leaving land permanently fallow and unproductive might be a short-term fix, but a moment's thought confirms that in the longer term it is simply unsustainable.
The concept of nutrient neutrality is relatively new, but it can have a huge impact on areas such as the Solent, Somerset Levels, or anywhere similar. If Natural England expand their advice to other local authorities not to grant planning permissions, then this will really ramp up the issue of nutrient neutrality.