Nutrient Neutrality News– What do developers need to know as of Spring 2023?

Nutrient pollution is a big environmental issue. In freshwater habitats increased levels of nutrients such as nitrogen and phosphorus can speed up the growth of certain plants, which can have a detrimental impact on their surrounding environment.

Nutrient neutrality is one of the Government’s environmental initiatives to deal with this issue as it provides a means of ensuring that a planned development or project does not add to existing nutrient burdens so there is no net increase in nutrients as a result of the plan or project. This initiative has had wide reaching effect on developers with the main issue being the impact on their ability to obtain planning permission without first illustrating that the nutrient impact of the proposed development cannot be mitigated or neutralised. This has caused delays for both developers and Local Planning Authorities (LPAs).

For further information on the background of this initiative including information on affected areas please see our previous article on this subject by clicking here .

In July 2022 the Government issued a statement acknowledging that, nutrient neutrality requirements place “significant additional requirements on development and assessment by LPAs when plan-making or taking decisions. This has delayed the granting of planning permissions until mitigation is secured. To date there has been a high mitigation requirement, to achieve the necessary offsetting of nutrient pollution related to development, as well as an insufficient supply of accessible mitigation.”

Further to this statement there are three key updates which may aid the implementation of nutrient neutrality – :

Legal duty on Water Companies in England

The Government announced measures aiming to reduce the mitigation that new development must secure, as well as making access to mitigation easier.

One of the measures announced in July 2022 was a plan to introduce a legal duty on water companies in England to upgrade wastewater treatment works by 2030 in ‘nutrient neutrality’ areas to the highest achievable technological levels.  This will be an amendment to the Levelling Up and Regeneration Bill tabled by the Secretary of State.  At today’s date the amendments to the Bill are at the “Report Stage” in the House of Lords.

The amendment will introduce a legal obligation (subject to certain specific exceptions) on sewerage undertakers to upgrade any plant that discharges effluent into a nitrogen or phosphorus sensitive catchment area to meet the required nitrogen or phosphorus nutrient pollution standard by 1 April 2030.

Critics, including trade bodies, have described the proposed amendments as “a blunt solution that won’t solve the problem for nearly a decade, cost bill payers much more money than it needs to, stymie the growing practice of using markets and partnerships, and prevent the generation and restoration of habitats”.  The amendments will require the rebuilding of sewage works with hard engineering methods rather than looking at mitigation options that are more beneficial to the natural environment.

Watch this space as to whether the amendments to the Levelling Up and Regeneration Bill are approved meaning that this obligation on water companies becomes legally binding.

Nutrient Mitigation Scheme

As part of its two-pronged approach to the issue (along with the above), the Government also announced the “Nutrient Mitigation Scheme” as a mitigation-solution-option for LPAs.

The Nutrient Mitigation Scheme will create new wetlands and woodlands in England and Wales.  Natural England (NE) will work in partnership with Department for Environment, Food & Rural Affairs (DEFRA) and the Department for Levelling Up, Housing and Communities’ (DLUHC) both of which are proposing to provide substantial funding to the scheme.

The scheme will support investment in new wetlands and woodlands which will ‘soak up’ or mitigate the impacts of nutrient pollution, whilst also providing wildlife habitats. Developers can then purchase ‘nutrient credits’, to help fund these schemes, which will go towards discharging the requirement to provide mitigation.

The intention is that the scheme will be open to all developers, with priority given to smaller developers who are most affected.  Developers can also continue to put their own mitigation schemes in place.   The Government has suggested that the scheme will enable LPAs to grant planning permission for development subject to conditions or obligations securing mitigation and phasing developments (if needed) so that mitigation is operational and in place, prior to any nutrient pollution being discharged.  Once payment for credits has been made, and any related planning conditions discharged, new homes can be occupied.

Natural England (NE) has confirmed that the first projects are being negotiated in the Tees catchment where the first round of applications to developers was launched on 31 March 2023.  We understand that that NE are progressing feasibility studies in five further catchments to determine possible next mitigation site and that NE has also started to approach landowners to invite them to offer their land as potential sites for nutrient mitigation to enable the mitigation projects to expand across the country.

In the 2023 Spring Budget the Government confirmed their commitment to provide funding for “high quality”, local mitigation schemes and a call for evidence from LPAs about the best way to fund these mitigation schemes – again watch this space as to what will come of these and the outcome of the first projects currently underway.

The case of Wyatt v Fareham Borough Council (Fareham)

In July 2022, the Court of Appeal handed down its judgment in this case. They confirmed the legality of NE’s guidance to LPA’s on nutrient neutrality and dismissed an application for judicial review of Fareham Borough Council’s decision to grant outline planning permission for development (which included the demolition of existing buildings and construction of eight detached houses at a site located in Warsash, Southampton).

The main reason why this case is interesting is that the planning authority with NE’s approval deviated from NE’s guidance which encourages the refusal of planning permission where mitigation cannot be achieved thereby increasing nutrient levels.   NE’s methodology is based on an average occupancy rate of dwellings including a “precautionary buffer”.  The use of the average rate and application of the methodology by Fareham and NE’s advice were challenged as part of the judicial review claim.

The court found, amongst other things, that the methodology used by Fareham did not render the assessment carried out by it unlawful for the purposes of the judicial review claim, and that as Fareham had consulted NE about the proposed development (and NE stated that it had no concerns) Fareham was entitled to have regard to this.

The judgment is therefore useful in respect of suggesting the court’s approach to the application of the methodology and confirming the significance of consultation with NE, and the NE’s advice on the matter.

Our Comment

 The Government has acknowledged the significant impact of nutrient neutrality on development progressing through the planning system but it seems it is here to stay.  Hopefully, we will soon see progress with an accessible scheme which will provide developers with a suitable option for mitigation of this pertinent issue.

If you wish to discuss any of the issues raised by this article please do not hesitate to contact one of our specialist planning or development lawyers.