Combining Biodiversity Units and Nutrient Credits – how does it work?

by Jo Hanslip

Who can sell biodiversity or nutrient credits – or both?

  • the landowner
  • the long-term leaseholder
  • the tenant farmer
  • a business or organisation that carries out habitat creation or enhancements

What are Biodiversity Units?

Biodiversity units are calculated using the size of the habitat, its quality and location. The biodiversity metric should be used (version 4.0 will be issued later in 2023). This metric is anticipated to become statutory.


What are Nutrient Credits?

Nutrient mitigation makes sure a new development does not add to nutrient loads in water bodies where protected sites (or Habitats Sites) are in ‘unfavourable condition’ resulting from the polluting effects of excessive nutrients. Nutrient mitigation is also known as nutrient neutrality. Nutrient credits can be created by reducing or capturing nutrients that would otherwise end up in protected water bodies.

What is a Nature Market?

Nature markets enable land managers to receive payment for undertaking improvements that benefit nature. If land is used for different environmental projects, it might be possible to sell the services as credits or units to different buyers. Nature markets include carbon sequestration and flood alleviation.

Can I stack credits from different Nature Markets?

In some instances, yes. Stacking is when multiple credits or units from different nature markets are sold separately from the same activity on a piece of land. biodiversity units and nutrient credits can be stacked, subject to meeting the eligibility criteria for each market.

Can I sell more Units on an existing BNG Site?

Potentially yes, you can sell more biodiversity units if:

  • the original planned habitat creation and enhancements have been completed.
  • a new or updated legal agreement to cover the remaining time on the initial agreement, plus at least 30 years for the new habitat works is neutered into.

Do BNG and Nutrient credits agreements have the same timescale?

No, BNG agreements will be generally for 30 years.

Nutrient agreements can commit assets for nutrient mitigation for up to 125 years.

What if my BNG Agreement has ended by the nutrient agreement has not?

If your BNG agreement has ended but your nutrient agreement is still in place, you can still sell more biodiversity units if you:

  • calculate the baseline after the original BNG legal agreement has ended
  • only sell the biodiversity units created by the new changes in habitat condition or distinctiveness
  • have a new or updated legal agreement to cover any remaining time on the initial agreement, plus 30 years for the new habitat works

Can you get any environmental public grants if you are selling biodiversity or nutrient credits?

Potentially for the following purposes:

  • help get your project ready for investment – this could mean preparing the land to sell biodiversity units or nutrient credits on an otherwise unsuitable site or project
  • access funding which is repaid in full on sale of the biodiversity units or nutrient credits
  • pay for a specific aspect of the project, which is not part of the habitat creation or enhancement

Do agri-environmental schemes qualify?

Yes, you may still be able to sell biodiversity units and nutrient credits and receive funding from agri-environmental schemes such as:

  • Sustainable Farming Incentive (SFI)
  • Countryside Stewardship (CS)
  • Environmental Stewardship (ES)
  • Landscape Recovery (LR)

Can you sell biodiversity units and nutrient credits from the same land you used to sell carbon credit?

Yes, if you can demonstrate further enhancements to the habitats and do not impact its carbon value.

Can Corporate social responsibility (CSR) habitats qualify?

If you have created or enhanced habitat to sell to a private company as part of their CSR, you should not sell them as biodiversity units or nutrient credits.

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