New Nature Restoration Levy and Environmental Delivery Plans in England and Wales

An EDP is a plan prepared by Natural England and made by the Secretary of State, setting out environmental features likely to be negatively affected by development, the conservation measures to be taken, the amount of the NRL payable by developers, and the environmental obligations that may be discharged or modified if the NRL is paid. The EDP applies to specified developments in England or adjacent waters.

• Scope: An EDP must specify the development to which it applies by reference to both the area in which the development is (with a map) and the kind of development.  The EDP must specify the maximum amount of development.  
• Consideration: EDPs must be prepared (and amended or revoked) with regard to the development plan for the development area, any current environmental improvement plan, Environment Agency strategies; marine plan, marine policy statement and UK marine strategy and any other strategies or plans so far as Natural England and the Secretary of State consider relevant.  
• Period: the start and end dates of the EDP must be set out and it may not exceed a period of ten years.
• Environmental features and impacts: An EDP must identify environmental features (i.e. protected features of protected sites, or protected species) likely to be negatively affected by the development to which the EDP applies and the ways in which those negative effects may occur (known as the ‘environmental impact’).  The Act says that ‘the environmental impacts identified in a EDP may only affect nutrient neutrality, water quality, water resource, or air quality’.  Essentially that constraint bites across the application of the entire EDP and NRL regime and the extent to which it relieves developers of other legal obligations.  This was a late amendment to the Bill introduced at Report stage in the House of Lords.  It was originally intended that the Bill’s provisions would apply more widely to impacts.
• Conservation measures: An EDP must set out measures to address the identified environmental impacts and to improve the conservation status of the identified environmental feature(s).  The EDP must set out the anticipated sequencing of the implementation of the conservation measures by reference to the development to which the EDP applies.  This suggests a close connection between the EDP and specific development – it will be interesting to see how and to what extent conditions are imposed on consents for development to mirror the sequencing intended under the EDP with implementation brakes, if necessary.  
• In relation to conservation measures that apply to protected features of protected sites, the EDP may set out conservation measures that do not directly address the environmental impact of development of that feature at that site but instead seek to improve the conservation status of the same (or presumably similar type of) feature elsewhere – however, that can only be done if Natural England considers that such measures would make a greater contribution to the improvement of the conservation status of the feature than measures at the protected site itself.  
• There is also a requirement for the EDP to provide a buffer or contingency – i.e. include measures that are not, at the time the EDP is made, expected to be needed, but which must be implemented in the circumstances set out in the EDP.  It is not clear whether this is in relation to (i) the environmental impacts of the development turning out to be greater than expected or (ii) the initial measures not working as hoped; or (iii) both.  
• The Explanatory Notes to the Act give the example of an EDP in respect of housing development and nutrient pollution on a protected watercourse.  The conservation measures suggested include ‘the building of a wetland and a requirement for local authorities to apply a condition on all planning permissions that houses include septic tanks.  
• The EDP must also set out information on the measures as to their cost, how they are to be maintained (and over what period) as well as how effectiveness will be monitored.  
• Charging schedules: An EDP must include schedules detailing how the nature restoration levy is to be calculated for each type of development and impact, in accordance with regulations.
• Other requirements: An EDP must describe the conservation status at the start date, rationale for chosen measures, alternatives considered, terms of relevant licences, strategies/plans considered, monitoring arrangements, and any additional measures by Natural England or other authorities.

• Notification and consultation: Natural England must notify the Secretary of State and publish this decision. A draft EDP is then published for public consultation, seeking views from specified authorities (Environment Agency, JNCC, local planning/highway authorities, Network Rail, Mayor of London, Marine Management Organisation, devolved administrations if relevant, and others as appropriate).
• Decision and publication: The Secretary of State may request further information, decide whether to make the EDP (with reasons published if declined), and must publish the EDP within 28 days of making it. The EDP start date cannot precede its publication.

The Secretary of State may only make an EDP if he or she considers that it passes the overall improvement test – the Act provides that an EDP will pass that test if, by the EDP end date, the effect of the conservation measures will materially outweigh the negative effect of the EDP development on the conservation status of each environmental feature. The negative effect of the EDP development is to be taken as the effect caused by the environmental impact identified in the EDP (i.e. on nutrient neutrality, water quality, water resource, or air quality) of the maximum amount of development to which the EDP may apply. 

• Reporting: Natural England must publish reports at the EDP midpoint and end date, or on revocation, detailing development progress, levy receipts, implementation and effectiveness of conservation measures, costs, amendments, and whether the EDP passes the overall improvement test.
• Amendment: The Secretary of State may amend an EDP (but not so that it no longer applies to development in respect of which a developer has already committed to pay the NRL).  Amendments which increase the amount of development, change the development area or add new conservation measures must be subject to consultation.  There is also a further limitation that amendments may only be made if the Secretary of State considers that the EDP as amended passes the overall improvement test.  

• Liability to Pay: an EDP may provide that payment of the NRL is mandatory in relation to a kind of development and a kind of environmental impact (and if does make such provision in must explain why).  Otherwise, the NRL is voluntary, and developers may request to pay the levy or not – a developer would do so to obtain the benefits set out below.  Once a request to pay has been accepted by Natural England, the developer is obliged to pay.  
• Amount: the NRL will be set by Natural England according to provisions to be set out in ‘Nature Restoration Levy Regulations’.  The overall purpose of the NRL is to ‘ensure that costs incurred in maintaining or improving the conservation status of environmental features can be funded (wholly or partly) by developers in a way that does not make development economically unviable’.  It appears that that the NRL may operate in a similar manner to the Community Infrastructure Levy (CIL) as the Bill provides that the Nature Restoration Levy Regulations may provide for charging schedules that operate by reference to descriptions of development, amount / nature of the development, nature or existing use of the development site as well as inflation etc.  
• The Nature Restoration Levy Regulations will also provide the detail of exactly who is liable / who can assume liability to pay the NRL, joint and several liability and apportionment.
• Use: the NRL must fund conservation measures relating to the environmental feature in relation to which the NRL is charged.  The Nature Restoration Levy Regulations may specify conservation measures that may or may not be funded by the NRL and maintenance and operational activities in connection with the conservation measures that may or may or may not be funded by the NRL.  It appears that it may be possible for the NRL to be used to reimburse expenditure already incurred and to cover administrative expenses.  
• Payment: payment in kind should be possible (e.g. making land available or carrying out works or services) as well as payment in instalments.  The enforcement powers for failure to pay are not set out in the Bill – the detail will be set out in the Nature Restoration Levy Regulations (but those powers might include financial penalties, criminal offences or injunctive relief).  It may be possible to register the NRL liability as a local land charge. 

• Natural England: responsible for administering, implementing, and monitoring EDPs, and may pay others to take conservation measures. The Act gives Natural England sweeping new powers to enter and survey or investigate land as well as to seek powers to acquire land compulsorily.  
• Public authorities: must cooperate with Natural England in preparing and implementing EDPs, including providing information and assisting with conservation measures.  Notable the duty to cooperate includes a requirement for a local planning authority to impose or vary conditions on development.  Public authorities may also be charged with collecting the NRL. 

Schedule 3 to the Act sets out the legal effects of EDPs on existing obligations under environmental legislation biting on development.  It provides that where a developer commits to pay the NRL as set out in an EDP for a particular environmental impact (or is obliged to do so), certain regulatory requirements and assessments are modified or disapplied as follows:

• For European sites or Ramsar sites, the environmental impact of the development on the protected feature is disregarded for the purposes of Part 6 of the Habitats Regulations 2017, meaning that the usual assessment requirements do not apply.
• For Sites of Special Scientific Interest (SSSIs), the impact is disregarded for the purposes of consents, appeals, duties, and certain offences under the Wildlife and Countryside Act 1981.
• For Marine Conservation Zones, the impact is disregarded for the purposes of the duties of public authorities under sections 125 and 126 of the Marine and Coastal Access Act 2009.
• Where the environmental feature is a protected species (under the Habitats Regulations 2017, Wildlife and Countryside Act 1981, or the Protection of Badgers Act 1992), payment of the levy results in a licence being treated as granted to the developer, on the terms set out in the EDP.

In summary, Schedule 3 ensures that, subject to payment of the NRL, developers can proceed with certain developments without being subject to the usual environmental assessments or licensing processes for protected sites and species, as these are replaced by the regime established under the EDP.

However, it should be noted that this all only applies to the specified environmental impacts.  As set out above, environmental impacts identified in a EDP may only affect nutrient neutrality, water quality, water resource, or air quality’.  

Where there is an effect on a protected feature of an European site or Ramsar site that is identified in a EDP which is caused by development which is within a EDP but that effect is caused by an environmental impact other than nutrient neutrality, water quality, water resource, or air quality, then an appropriate assessment under Habitats Regulations will need to be carried out - that impact and its affect on the SPA needs to be included within that appropriate assessment, and the full provision of Part 6 of the Habitats Regulations will apply.  That is to say, if the assessment identifies that there is material adverse impact on integrity after mitigation, the development should not go ahead unless there are imperative reasons of overriding public interest and no reasonable alternatives to the development.  Compensatory measures will then have to secured (over and above the payment of the NRL).  So, for example, this would include any development that reduces the overall area of a European site or where there are likely significant effects on designated bird species within a Special Protection Area caused by human activity, lighting, noise or similar.  

As such, the utility of the EDP / NRL provisions in bringing forward will be limited, in particular it is not likely to assist with most type of infrastructure where impacts, particularly on European sites, are likely to be caused by environmental impacts other than on nutrient neutrality, water quality, water resource, or air quality.

To note, EDP / NRL will not supplant other similar regimes.  The requirements to provide Biodiversity Net Gain remain and where applicable, Community Infrastructure Levies will still have to be paid over and above any NRL payments.