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Natural capital markets remain a talking point in the rural sector, heightened by the Environment Act which puts the environment at the heart of policy making. The extensive legislation is aimed to reverse long-term trends of environmental decline, including the government’s targets on air, water quality, biodiversity and waste. Local Nature Recovery Strategies (LNRS) and Biodiversity Net Gain (BNG) are two particular elements which are of relevance to the rural sector, both to be introduced through the Act.
BNG is a new planning approach for development and its aim is to increase biodiversity and leave it in a better state than before. This will require, in many instances, developers having to offset the impact of their developments by securing offsite creation or enhancement of habitat in the local area.
LNRS are a new England-wide system of spatial strategies that establish priorities for local nature recovery, identifying areas which need improvement as well as coming up with proposals for improving habitat for nature and wider environmental goals. This will be one of the most significant policies for farmland owners as they are to be used to target spending in the new ELM scheme. LNRS will be important to keep a close eye on when determining opportunities for funding and natural capital markets.
There are also opportunities for carbon offsetting through woodland creation and peatland restoration. The Woodland Carbon Code and the Peatland Carbon Code provide important verification standards necessary in order to access the market.
All of these elements have the opportunity to open up new markets and create new income, with the Green Alliance estimating they could be worth as much as £1.7bn a year in the UK.
So how can these markets benefit landowners?
Natural capital has been at the forefront of people’s minds and, as a result, there has been wide interest in the limited supply of land coming to the market. The opportunities for public goods, tree planting and carbon credits coming from a wide range of buyers has consequentially driven up demand and values. As the 2030 nature goals and the 2050 net zero target creep closer, more and more people are seeking land for offsetting and this could provide a window of opportunity for farmers and landowners to seize if they are thinking about selling. Stags have a team of experienced land agents and Chartered Surveyors who are here to help provide professional advice. Please contact Andrew Ranson on 01566 774999 if you are considering a sale.
