Measuring your natural capital assets

If you are considering whether your land can produce biodiversity units for Biodiversity Net Gain (BNG), you may be thinking about where to start. To enter into a BNG contract or any nature market, you need to understand the natural capital assets you have and their condition. To progress a BNG project, you will need to appoint an ecologist who understands the Biodiversity Metric, but it is possible to make an initial assessment yourself.

Documenting and assessing your natural capital assets will help to identify land that is suitable for BNG or other nature markets.

A natural capital assessment should identify your land’s natural capital assets. This could simply be about mapping the holding’s land types (woodland, boundary features, grassland, water bodies and so on). Publicly available national and regional data, such as the Multi-Agency Geographic Information for the Countryside and local records centres, can supplement your knowledge. A simple list or map of natural capital assets provides a foundation on which you can build by adding more detailed information, such as condition assessments. It is also helpful to capture other features, such as public footpaths and other rights of way, and the type of farming land used.

At a local level, it is worth identifying your local planning authority and their local plan policies and validation requirements, and the priorities highlighted in your area’s biodiversity action plans. Local authorities will be developing Local Nature Recovery Strategies with the explicit intention of helping to better target BNG and nature recovery activities more generally.

For offsite BNG (where the BNG is happening away from the development site), there is a preference for biodiversity units that are in the same local planning authority as the development site. This is calculated by a “spatial risk multiplier” in the Biodiversity Metric - a term that means you will be able to deliver more units within the same land parcel.

A natural capital assessment will identify all natural assets and evaluate their state or condition. This information is used to show the ecosystem services that are being delivered, or could be delivered with changes in land management. You can get an idea of their condition by using the UK National Ecosystem Assessment, which has eight broad habitat types.

Focus on habitats that work for your land type, not just local developer needs. Assessing your habitats’ condition will require you to think about physical characteristics such as soil, and biotic characteristics such as what species you have and what ecosystem processes take place in the habitat.

Once the information about your natural capital assets has been gathered and recorded, you can use it to inform where best to carry out certain activities, such as BNG. It is helpful to consider BNG in a way that could enrich other activities on your land – for example, wildflower meadows near crop fields to help pollination. The type of changes that will be made, such as wetlands, will impact what other farming activities, if any, can be continued on the land. Land that is currently low in biodiversity will provide the greatest potential uplift, so poor-quality farmland might be more suitable. You can use land that has been in agri-environment schemes, but it may not produce as many biodiversity units. Typically, biodiversity units should be a minimum of 25m squared, or 5m linear if it is a hedgerow.

To find your biodiversity baseline and calculate how many offsite biodiversity units you can deliver, you must use the statutory Biodiversity Metric calculator, which requires a qualified ecologist – otherwise you won’t be able to register your units. For most farmers and landowners, this will mean hiring a qualified ecologist to do your baseline and work out the possible net gain from your land.

Make sure your ecologist is familiar with the Biodiversity Metric and has experience with the relevant habitats and as a habitat surveyor. Ecologists will be able to produce the ecological reports to verify your baseline if requested by the developer, local authority or responsible body.

For BNG, you can create or enhance habitat before selling your biodiversity units, known as habitat banking, or you can find a buyer first and then start the work. It is worth bearing in mind the pros and cons of each option: the further in advance you create the habitat, the more units you will receive. Likewise, any delay to the start of habitat creation will reduce the number of units available on that land due to the calculations in the Biodiversity Metric.

The BNG flowcharts accessible here show how the step-by-step process would work for advance and post-sale habitat creation.

Creating habitat in advance means it is delivered sooner – a significant win for nature recovery. Developers will likely see pre or partially created biodiversity units as a better buy in terms of their reputational value: they’ll be able to point directly to the outcomes of their investment in your biodiversity units.

The CLA has recently updated its range of natural capital guidance notes for members, which provide a detailed overview of nature markets, how to access the market, and what to think about before you do.

You can also explore the CLA Natural Capital Directory, which has listings of companies that can help you with assessments and access to markets.