Nutrient neutrality, we hardly knew ye

Before they tip their hard hats to the housing secretary, who last week announced plans to abolish unpopular nutrient neutrality (NN) rules, housebuilders and developers should be mindful of the growing challenges around environmental regulation that the change presents.

Introduced in 2017, NN rules were designed to stop pollution caused by increased nutrients in rivers speeding up the growth of plants and upsetting ecosystems. Sewage and waste water typically lead to nutrient increase (mainly phosphates and nitrates), hence the focus on house building and development. In river catchments with high nutrient content (equating to around a quarter of local authorities in England), builders had to show as part of the planning consent that their development caused no net nutrient increase. This could be done either on site (creating wetlands or installing better sewage treatment) or off site (buying credits). The Government says abolishing NN rules will “unblock” 100,000 new homes currently stuck in the planning system.

A noble aim perhaps, as NN undoubtedly impacted housebuilding in places where homes are needed. Discharging NN obligations was expensive and difficult even for those who were ready to pay and the market for credits never quite took off. Calculating the future nutrient saving of a particular action is also an uncertain science. Developers would argue that the burden fell disproportionately on housebuilders, when farmers and water companies also contributed to the problem. 

Nevertheless, NN will be missed, not so much for what it was, but for what it represented and could have become – a viable nature based solution to a clear problem, underpinned by regulation but largely built by the private sector. Supporters say NN has been cut down just as it began to function and a viable marketplace for nutrient credits was emerging. In its Nature Markets Framework published in March 2023 (as part of the "Green Day" of environmental announcements), the Government said “nutrient credits are making good progress in building a pipeline of affordable mitigation”. It was supposed to be a model for how other nature markets (biodiversity, carbon, etc.) might work.

Six months on from Green Day and the Nature Markets Framework, environmental policy direction is unclear. Along with the Government’s recent release of new licences for North Sea oil and gas and the ongoing ULEZ controversy, NN’s end could be attributed to a wider anti-environmental reaction. Mandatory Biodiversity Net Gain (BNG), another environmental levy on development, is due to be introduced in November but key guidance is still awaited. It would be no surprise if BNG was delayed or scaled back.

Developers will shed few tears for NN, but as much they resent regulatory burdens perhaps they should fear the uncertainty more. Confidence in natural capital investment and nature based solutions meanwhile has taken a hit. Parliament still needs to sign off the change and there is rumour of rebellion in the Lords. Until the horizon (and the streams) are a bit clearer, people will carry on counting their nutrients.