Guide to Nutrient Neutrality

Our comprhesive guide to Nutrient Neutrality takes you through everything a landowner needs to know.

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The problem

Developers need to offset the additional nutrient pollution caused by new developments within 'nutrient sensitive catchments.' They cannot get planning permission without doing this. They can either purchase nutrient credits or create nutrient mitigation schemes themselves.

What we do

Greenshank Environmental develops wetlands and other innovative schemes to provide nutrient offsets in areas affected by Nutrient Neutrality. The nutrient offsets our schemes create become nutrient credits that can be used by developers to offset the additional nutrient pollution caused by new developments within protected areas. Our expert team has been behind some of the UK’s first nutrient mitigation projects for Nutrient Neutrality, including phosphorus treatment wetlands in Herefordshire, decommissioning industrial sites in Hampshire and taking agricultural land out of production in the Solent. We have experience advising regulators and Local Planning Authorities on the evidence and standards needed to secure nutrients credits with sufficient certainty. We will use this expertise to ensure our mitigation projects will deliver nutrient credits with the certainty needed to unlock housing development.

What is Nutrient Neutrality?

Nutrient Neutrality is a new legal requirement under the Habitat Regulations. New development must show compliance with the habitat regulations through Habitat Regulations Assessments. This is because nutrient pollution from new development can damage the rare ecology of protected aquatic ecosystems. Where sites protected under the Habitat Regulations already have unsustainable levels of nutrient pollution, all proposals for new development are now required to show that the new scheme will not make the pollution worse. In other words, the new scheme needs to be ‘nutrient neutral.’ Nutrient Neutrality for new developments is delivered by offsetting the nutrients that the new scheme will produce. A key way to do this is through offsetting schemes such as new wetlands.

What causes Nutrient Pollution?

Nutrient pollution is released into freshwater and coastal areas from a range of different sources, including agriculture, aquaculture, septic tanks, treated and untreated wastewater, urban stormwater runoff, industry and fossil fuel combustion. These nutrient sources can either be carried in water that comes from various sources on land or be deposited from the atmosphere. Although various actions have been taken to reduce nutrient pollution, it is still at unsustainable and damaging levels in many protected ecosystems.

Which areas are under nutrient pressure?

27 areas of England and most of Wales have been impacted by Nutrient Neutrality. In these areas, more than 72 of the UK’s 333 Local Planning Authorities have been affected by Nutrient Neutrality and cannot consent to new development without showing it is nutrient neutral. Over the next 5 years, the issue is likely to more than double in scale, with the potential to affect more than 140 Local Planning Authorities.

Nutrient Neutrality hits hardest in areas where there is a lot of planned development.

The areas of the UK now facing the largest challenges are: England
‍The River Tees catchment
‍The River Wensum and Norfolk Broads catchments
‍The Somerset Levels
‍The Solent
‍The Hampshire Avon catchment
‍The River Eden catchment
‍The Derwent and Bassenthwaite Lake catchmentThe River Wye and Lugg catchment (Herefordshire)
‍The Poole Harbour catchment The River Stour and Stodmarsh catchment The River Wye catchment (Derbyshire)The River Camel catchment

‍Wales
‍The River Usk catchmentThe River Dee catchmentThe River Wye catchment

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How Do Developers Offset Nutrients?

Most of the mitigation schemes providing nutrient offsets are based on abandoning agricultural land. By stopping farming, you remove a source of nutrients by removing fertiliser or animal manure inputs to the land. This is how development has been unlocked in The Solent region. However, this approach is not cost efficient, has big impacts on the livelihoods of farmers and is problematic at a time when food security is more important than ever.Agricultural land use change schemes are also rarely cost-effective for phosphorus as you need too much land for them to be financially viable. Land use change is only a scalable solutions in areas where nitrogen is the only nutrient of concern.

There are various mitigation options that could be delivered by different types of land management. These options include riparian buffers, engineered logjams and blocking drainage ditches, which collectively are termed ‘catchment management solutions.’ These solutions have relatively low land take, are supported by evidence and are backed by the regulator. We know this as our experts are currently writing guidance for the regulators on how these options could be deployed.Catchment management solutions also have a range of extra environmental benefits including biodiversity improvements, natural flood management and carbon sequestration.Wetland schemes are another potential mitigation option that can deliver nutrient offsets at scale and without a significant land take, making them both space- and cost-efficient. These solutions are also supported by a methodology from the regulator.

What is a Nutrient Credit?‍

Credits are created on an 'offset per year basis' in units of kg/year. Mitigation schemes will quantify the kg/year of nutrient offset the scheme can provide and this is the number of nutrient credits available from the scheme. Developers need to calculate nutrient budgets for new development and these nutrient budgets are also quantified in units of kg/year of nutrients requiring offsetting. A nutrient budget therefore shows the number of nutrient credits a developer needs from a mitigation scheme.

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How are Nutrient Credits Priced?

As credits can only be sold within a very specific catchment area, credit price is driven by local supply and demand. On the open market, in areas with high demand but limited supply, there will be significant competition which will drive the price up.

Prices as high as £100,000/kg for Phosphorus have been seen in some catchments. Nitrogen credits, while typically lower on a per kg basis, are required in higher numbers per house. We have seen a high range of nutrient credits costs on on a per house basis, from £2,500 to £7,000 per house, depending on catchment.

Nutrient Neutrality FAQ

Explore some commonly asked questions related to Nutrient Neutrality.

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What is Nutrient Pollution?

Nutrient pollution is released into freshwater and coastal areas from a range of different sources, including agriculture, aquaculture, septic tanks, wastewater, urban stormwater runoff, industry and fossil fuel combustion. These nutrient sources can either be carried in water that comes from various sources on land or be deposited from the atmosphere. While there are various actions that have been taken to reduce nutrient pollution, it is still at unsustainable and damaging levels in many protected ecosystems.

What is the DEFRA Nutrient Neutrality Exchange?

DEFRA is launching a trial exchange platform for the purchase and sale of credits in the Solent region. This has been done to minimise the administrative burden on developers and mitigation schemes and allow greater price transparency.
While we would welcome this development, the exchange is not yet active and is only being piloted in an area where the market is most well established and, in places, saturated. As such the Solent region is not an initial target for us. We feel the majority of our sales will occur ‘off market’ as we will target areas where there is little supply and no established strategies for the generation and sale of credits, thus giving us a competitive advantage.

Who will need to engage during the process of deploying wetland schemes?

The organisation or people that own the dirty water our wetlands will be treating. They are the key stakeholder to get onboard in the first instance.
The relevant Local Planning Authority, who we will seek to partner with in order to ease our sale of credits within a given area.
Natural England, who are the regulator for the protected ecological sites that the nutrient offsetting is needed for and who will ultimately sign off on our wetlands. We have a close working relationship with key members of the national team at Natural England who are dealing with Nutrient Neutrality at a strategic level.
The Environment Agency will need to be engaged to obtain discharge permits for the wetlands to discharge to certain water bodies. They may also need to be engaged for other regulatory assessments.
Environmental NGOs or other relevant community groups will be engaged to manage the wetlands and meet the ‘in perpetuity’ requirements for long-term maintenance of the schemes.

What is a technical report and why is it needed?

Why is Nutrient Neutrality important?

It helps protect water quality, supports biodiversity, and complies with legal requirements to protect designated habitats. By preventing excess nutrients from entering water bodies, we can avoid problems like algal blooms and fish kills.

Who will need to engage during the process of deploying mitigation schemes?

The relevant Local Planning Authority, who we will seek to partner with in order to ease our sale of credits within a given area.
Natural England, who are the regulator for the protected ecological sites that the nutrient offsetting is needed for and who will ultimately sign off on our wetlands. We have a close working relationship with key members of the national team at Natural England who are dealing with Nutrient Neutrality at a strategic level.
The Environent Agncy will need to be engaged to obtain discharge permits for the wetlands to discharge to certain water bodies. They may also need to be engaged for other regulatory assessments.
Environmental NGOs or other relevant community groups will be engaged to manage the wetlands and meet the ‘in perpetuity’ requirements for long-term maintenance of the schemes.