Evaluation of the Biodiversity Offsetting Pilot Phase, WC 1051
Summary of Interim Report, July 2013
Collingwood Environmental Planning Limited
in partnership with
The Institute for European Environmental Policy (IEEP)
Introduction
The Biodiversity Offsetting Pilot Scheme was established in April 2012, consisting of six voluntary pilot areas that agreed to establish pilot groupings of Local Planning Authorities (LPAs) and other interested stakeholder organisations to pilot the concept of voluntary biodiversity offsetting in England. In so doing, the pilot areas would also test the biodiversity offsetting metric developed by Defra (The metric is contained in detailed guidance for developers and offset providers – see https://www.gov.uk/biodiversity-offsetting)
The six pilots are:-
1. Coventry, Solihull and Warwickshire.
2. Devon (including three sub-pilots North, South and Heart of Devon).
3. Doncaster.
4. Essex.
5. Greater Norwich.
6. Nottinghamshire.
This is the Executive Summary to the Interim Report of the Evaluation Project of the Biodiversity Offsetting Scheme – a two year study which began in July 2012. This report therefore presents the findings of the first year of the pilot scheme. The stated objectives of the Evaluation are to assess the extent to which the biodiversity offsetting pilots:-
A: Help to use resources more effectively to deliver greater benefits for biodiversity.
B: Streamline the process of agreeing compensation for biodiversity loss as required by planning policy, in a cost effective way.
The pilots are being evaluated across four distinct stages:-
Stage 1: Setting up of the pilot;
Stage 2: Development of the pilot biodiversity offsetting strategy;
Stage 3: Individual development projects and associated offsets: including the identification and accreditation of offset providers and engagement with developers; development of legal agreements, formal approval and monitoring arrangements; and use of the metric around specific development projects.
Stage 4: A review of existing planning cases in which biodiversity has had an impactto test whether the consideration of biodiversity has increased project time, reduced the number of sites available for development or reduced net developable area of sites that have been given planning permission and present information gathered in a form suitable for incorporation into a government economic impact assessment.
This interim report covers Stages 1 and 2 only – the establishment of the pilot groups and the development of their biodiversity offsetting strategies. There are limited biodiversity offsetting projects within the pilots at the time of writing, hence the decision to focus on Stages 1 and 2.
This research for the evaluation has been undertaken primarily through document analysis, review of the biodiversity offsetting strategies for each pilot, and an on-going series of semi-structured interviews undertaken with the pilot leads, key stakeholders and Natural England’s pilot advisers.
Key findings
The findings to date are presented according to the Evaluation Themes with the results collated thematically across all the pilots:
The lack of suitable biodiversity offsetting projects coming forward to date is noted and should be considered as a significant finding in itself. There are numerous external reasons for this, including the economic recession, changes to the planning system and reduced demand for development, but it does appear that developers are cautious about what they appear to perceive as an additional process with limited obvious benefits. Interim Report June 2013
On the other hand, discussions on a number of projects are coming forward in a few of the pilot areas, notably in Coventry, Warwickshire and Solihull; Essex; and Greater Norwich. There are also numerous examples where the metric has been used, even if no formal offsite compensation / biodiversity offsetting has been undertaken. These examples will provide a focus for Stage 3 (and Year 2) of the Evaluation Project along with investigations in the other pilot areas of the reasons for projects not coming forward, should this continue to be the case, and/or specific challenges that emerge.
Governance
1. The pilots have developed a range of governance structures that appear to be viable, fit for purpose and which have produced final or advanced drafts of offsetting strategies.
2. The numbers of organisations involved in each pilot varies from 2 to 22 and a wide range of ecological, procedural and spatial planning expertise appears to be necessary for the effective delivery of the offsetting strategy. This indicates there is no clearly universal governance structure that has emerged to date but that there is a need for multi-sectoral pilot groups to develop the strategies and to support any projects.
Process and management
3. The pilots have developed final or advanced drafts of offsetting strategies that explicitly address many of Defra’s Principles of biodiversity offsetting2 – especially with regard to biodiversity protection and contributing to local and national biodiversity priorities and policy. Some of the challenges around the Principles remain insufficiently explored including addressing concepts such as ‘in perpetuity’, ‘additionality’ and the involvement of communities.
4. Biodiversity offsetting and the metric appear to be seen as delivery mechanisms for delivering existing biodiversity and green infrastructure policy – in this way, to date, the pilots are more about evolution than revolution. This may change when projects come forward for consideration.
5. The pilots have established a good degree of coordination with notable initiatives such as the NIAs and LNPs.
2 Defra (2011) Guiding Principles for Biodiversity Offsetting [Online] Available from: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/166036/110714offsetting-guiding-principles.pdf.pdf
Legal and Development Planning
6. The pilots have developed strategies that vary in: their approach to integrating biodiversity offsetting into biodiversity and spatial planning policy; structure; level of detail; procedural arrangements, formality and technical characteristics.
7. A majority of the participating LPAs have indicated a preference for offset receptor sites to be located within the same LPA as the impact.
8. While the biodiversity offsetting strategies that have been developed to date are felt to be appropriate for the voluntary, pilot programme, it is likely they will need to be more integrated into planning policy and will need a robust evidence base in a mandatory system. The exception being the Coventry, Warwickshire and Solihull strategy, which is designed for the delivery of ‘mandatory’ biodiversity offsetting.
9. There remains a significant degree of reluctance from developers and potential offset providers to engage with biodiversity offsetting. This is felt to be due to the negative perceptions of the concept in some quarters, concerns that it is an additional requirement for developers, and specifically for providers the upfront costs, uncertainty around the definition of ‘in perpetuity’ and additionality including the price that will be paid for biodiversity units provided, e.g. compared to alternative income from land, such as from Environmental Stewardship schemes.
Costs
10. The cost of establishing pilots and developing biodiversity offsetting strategies varies considerably across the diverse nature and size of the pilot groups. Estimates provided by the pilots vary from tens to hundreds of hours of officer time to set up the pilot groups themselves, and between c. £1,000 - £13,000, to develop the offsetting strategies. A considerable amount of time that has been provided has also not been recorded as the time spent by the pilots on biodiversity offsetting is increasingly seen as part of their everyday roles, meaning cost estimate are likely to be underestimated.
11. The amount of time and resource spent raising awareness and capacity within the pilot areas is significant and appears to exceed that spent forming the pilot groups and developing the strategies. This is felt to be due to the newness of the concept as well as its technical nature.
Conclusions
It is possible to provide some, interim conclusions against the Evaluation Objectives – noting the focus of this report on Stages 1 and 2 only.
Firstly, it is notable that significant resources have been expended by the pilots in getting to the point where most have final strategies and are exploring development projects. That the Devon and Coventry, Warwickshire and Solihull pilots have not, after 15 months, produced final strategies should be recognised and this lack indicates that strategy development is not necessarily a simple and straightforward process. Many of the pilots feel the lack of specific resources for biodiversity offsetting has hampered progress in the pilot areas, particularly given the need to raise awareness internally and among developers, LPAs and potential providers. The offsetting strategies draw on existing data sources and use staff, resources and expertise which are already in place within the pilot groups; in this respect biodiversity offsetting does not necessarily require new structures and roles. If biodiversity offsetting is to become a normal part of the planning process there is a view among the pilots that their strategies will require review and that better data and more capacity will be required at the LPA level. Whether resources will be used more effectively through biodiversity offsetting in the long run remains to be seen and requires evidence from projects (Stage 3) before conclusions on this can be drawn.
Secondly, It is too earlier to say whether biodiversity offsetting will help deliver a streamlining of compensation processes since to date it does not always appear well integrated with existing compensation mechanisms, e.g. under Habitats Regulations. No clear pattern has emerged around how it will work in relation to existing mechanisms for compensation such as s.106 agreements or conditions imposed as part of planning consent. Understanding these aspects will require actual projects agreeing specific arrangements.
The metric itself has been seen to be helpful in agreeing the scale of biodiversity loss from development, whether or not offsetting enters into the discussion. The application of the metric therefore appears to help support the mitigation hierarchy, perhaps encouraging design modification to reduce biodiversity loss and improve consistency in compensation or biodiversity offsetting.
Finally, within the pilots the issue of delivering offsetting as locally as possible has been raised and there is a preference for it to be delivered within the same LPA that the biodiversity units are being lost from within the majority of the pilots. This issue is likely to come into focus in the context of individual developments as they come forward.