The market for BNG units has really taken off during the past two years and, while it is still nascent, is gradually finding a rhythm and marketplace. There are 197 sites registered to sell units, which is an increase from 46 sites just a year ago. The registered sites cover a total area of nearly 7,000ha, with around 28,000 habitat units available and only approximately 1,500 sold.

In short, this means there is a healthy supply of BNG units nationally, although there are certain ‘blackspots’ with no coverage – in fact only 107 of 309 local planning authorities (LPAs) have registered habitat banks. In these locations, developers have the choice of pursuing an ‘insetting’ option on additional land under their control locally, or finding options further afield in the same National Character Area (NCA) or adjacent LPAs. While this may be contrary to the objective of keeping biodiversity gains as local as possible to the site of loss, the data shows that off-site delivery in more distant LPAs/NCAs is still common (around 300 of the total 1,500 allocations).

However, it’s likely that as more habitat banks come online LPA coverage will increase and boost local nature recovery. The rate of habitat bank registrations may slow in time as the market becomes saturated with providers, but with the mandate for BNG associated with Nationally Significant Infrastructure Projects (NSIPs) expected soon this may also require significant off-site unit procurement.

The scale of NSIPs and regular conflict with rare/irreplaceable habitats may, however, result in made-to-order and bespoke off-site solutions rather than ‘off-the-shelf’ units. It is no secret that the BNG market slowed given its inextricable link to the planning system and discharge of planning conditions, but with wider planning reforms we expect that a streamlined planning system will also streamline and boost the BNG unit market.

What’s next for BNG?

At the end of 2025, the government announced some answers to the long-awaited consultation on amendments to BNG exemptions. We now know that sites up to 0.2ha will be exempt from BNG at some point in the latter half of 2026, albeit there is no detail yet regarding how this will apply to sites already in the planning system. While this is a marked and generally welcomed increase from the current 25sqm threshold, caution still remains in the industry as to how this will affect the supply and demand of BNG units.

A rapid consultation on targeted exemptions for brownfield sites is due in early 2026, with suggestions of residential sites up to 2.5ha being exempt. While there is no further detail on this consultation yet, we also expect the definition of open mosaic habitat will be revisited to give greater clarity to all, alongside a potential relaxing of the trading rules relating to these habitats. Currently, these habitats have to be replaced on a like-for-like basis, and given the scarcity and cost of units, procurement of off-site units is often not viable. 

BNG and Local Nature Recovery Strategies

Proposed changes to the National Planning Policy Framework (NPPF) may also restrict the ability of councils to push mandatory BNG beyond 10% locally via local plans, limited only to certain allocations and where it is justifiable and deliverable. These reforms would also give more weight to Local Nature Recovery Strategies (LNRSs) in plan-making and decision-making. These areas could be seen as opportunities for development to embed LNRS priorities into masterplans and allocations rather than being an obstacle to development. Over half of all LNRSs have now been adopted, and we expect 2026 to see the remainder in place. Early adopters are now shifting priorities to LNRS delivery through exploring blending finance models and using the private BNG market, coupled with public funding, to deliver nature recovery at scale. 

Further information

Contact Joe Dance