Biodiversity Net Gain (BNG) – the exemptions

In this article, legal director Joanna Crow explores the latest reforms to Biodiversity Net Gain (BNG), including the new exemption for developments of 0.2 hectares or less, additional proposed exemptions, and the practical implications for developers and local authorities ahead of changes expected in 2026.

A new exemption was announced in December 2025 so that development with a site area of 0.2 hectares or less will not need to deliver BNG. The exemption recognises that for smaller sites the BNG requirement may prove disproportionately costly and indeed unviable. Note that this new area-based exemption will not apply where there are onsite priority habitats (list of habitats and species identified as priority in the UK Biodiversity Action Plan). Existing rules on the treatment of irreplaceable habitat will continue to apply as BNG does not apply to irreplaceable habitat. In these cases, developers must minimise impacts and agree bespoke compensation strategies where irreplaceable habitat is impacted.

In terms of impact, Defra said it expected this change to exempt around 50% of residential planning permissions. The change will undoubtedly benefit local authority capacity focusing resources on fewer, larger projects. In its response to the results of the consultation, the government has cautioned developers that even with this exemption, developments will continue to be subject to a strong suite of other environmental protections through national policy and guidance, wider regulatory requirements and that planning decisions must still apply the mitigation hierarchy and refuse permission where significant harm to biodiversity cannot be avoided, adequately mitigated or as a last resort compensated.

In addition to the area-based exemption above, regulations are proposed to introduce exemptions for the following:

1. Development whose primary objective is to conserve or enhance biodiversity. How this is defined will be important and Defra will need to consult with stakeholders and provide adequate guidance but the intention would be to exempt works which are primarily concerned with enhancing or conserving biodiversity for example the creation of ponds. Within the biodiversity metric, deviations are allowed from the standard approach to trading rules in certain defined circumstances to support development that delivers biodiversity improvements but has a more significant capital infrastructure element meaning it would not qualify for an exemption and this “Rule 4” in the metric is also being reviewed as part of the consideration of this exemption.

2. Temporary permissions (defined as those for a limited period under section 72 of the Town and Country Planning Act 1990) for development which are for 5 years or less. The whole of the development must comprise temporary development to qualify for the exemption. This exemption recognises that because the land is to be restored to its previous condition, the cost of BNG, particularly if it can only be mitigated offsite, would be disproportionate. The exemption would not apply where onsite priority habitats are affected. Concerns were raised within the consultation responses about applicants misusing the exemption by seeking temporary permissions more frequently and then renewing them. Current guidance (on the imposition of planning conditions) addresses this and provides that it will rarely be justifiable to grant a second temporary permission. The guidance also states there is no presumption that a temporary grant of planning permission will then be granted permanently. Further guidance is expected to issue on BNG where a temporary scheme later becomes permanent.

3. Enhancement of playing fields. This will be a targeted exemption to apply where the development is not already exempt (for example below 0.2 hectares) and where no onsite priority habitats are impacted. In the case of playing fields, this is targeted at community and local authority playing fields and grounds, where development is ancillary to and directly related to the existing lawful use of the site as a playing field. Such improvements provide social and public health benefits. Playing pitches within a sports stadium or a wider residential/mixed-use scheme will not be included.

4. Enhancement of parks and public gardens. The exemption here is intended to apply to development that seeks to enhance these facilities (upgrading paths, boundary treatments, toilet facilities). The BNG baseline is likely to be high as the planning redline will tend to include the entire park/garden and therefore achieving a 10% gain would require substantial onsite or off-site enhancements.

Regulations are proposed to remove the current exemption enjoyed by small scale self-build and custom build development. Small scale single dwellings and other small schemes would be covered by the new area-based exemption referred to above.

The government is considering a targeted exemption for brownfield residential development. Consultation on this concluded on 10 June 2026 and feedback on this is presently being analysed. Depending on the outcome, changes to the de minimis exemption are being considered as the consultation includes options that would exempt even more development from BNG if taken forward. Notwithstanding this, the government does recognise there may be sites with an area greater than 0.2 hectares that will have little or no impact on habitat and thus the application of BNG could be disproportionate to the benefits, for example change of use applications, installation of solar panels on an industrial building, upward extension of flats. For now the de minimis exemption continues to apply within the existing thresholds.

Subject as always to parliamentary scheduling, we are told that Defra intend to implement some of the changes via secondary legislation before 31 July 2026. This will include regulations introducing the area-based exemption and the exemption for temporary permissions as well as removal of the self and custom build exemption. Regulations are also expected to be introduced to amend the biodiversity net gain hierarchy for minor development so that offsite biodiversity gains are given the same preference as onsite habitat creation/enhancement. The upcoming 0.2 ha exemption is materially broader than the current de minimis test and could remove BNG entirely for many urban infill schemes (particularly in London boroughs). The exemptions for development whose primary objective is to conserve or enhance biodiversity and the targeted development for enhancement of parks, playing fields and public gardens is expected later in 2026 and after the government publishes its response to the BNG exemption for brownfield residential development.

Guidance is expected to issue in tandem, updating current information and templates where appropriate but also addressing transitional arrangements. When BNG came into effect in 2024, transitional provisions exempted s73 variations to schemes which previously did not need to provide BNG. It remains to be seen whether a similar approach would apply here, as falling within additional exemptions would be more beneficial to a developer who amends a scheme which previously did not qualify for an exemption. The Planning Advisory Service will provide targeted support on these changes to local authorities.

Until the changes take effect, development (that is not presently exempt) will continue to be subject to a pre-commencement condition requiring the approval of a biodiversity plan demonstrating the 10% net gain before commencing onsite. There may be strategic value in timing (for example holding off submission or determination where small sites will benefit from the new exemptions).