The BNG Rules Just Changed — Here's What It Means for Developers and Habitat Banks
On 15 April 2026, the government published its long-awaited responses to two major consultations on Biodiversity Net Gain: one covering minor, medium and brownfield development, and a separate response on BNG for Nationally Significant Infrastructure Projects (NSIPs).
These are the most significant changes to BNG since it became mandatory in February 2024. Some of them will reshape how the off-site market works. Here is what you need to know.
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Small Sites Are Out
The 0.2 hectare exemption is confirmed. If your development site falls within a red line boundary of 0.2 hectares or less, mandatory BNG will no longer apply — unless on-site priority habitats are impacted.
This was first announced in December 2025, but it was not yet law. It still is not — the secondary legislation is expected before 31 July 2026. Until then, current rules remain in force.
The government estimates this will exempt approximately 50% of residential planning permissions previously subject to BNG. It also acknowledges a corresponding reduction: around 12% fewer baseline biodiversity units compensated, and roughly 10% less demand for off-site units.
But here is the thing: the developments that still require BNG will tend to be larger and more complex — exactly the schemes that struggle to deliver gains on-site and turn to off-site solutions. The market is shifting, not disappearing.
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Going Off-Site Just Got Easier
This is the change that matters most for the off-site market. For minor development, off-site BNG delivery is now placed on equal footing with on-site delivery in the biodiversity gain hierarchy.
Previously, the hierarchy required developers to deliver on-site first, even when that meant cramming marginal habitat into a tight plot. That distinction has been removed for minor schemes. Purchasing units from a registered habitat bank is now treated as equally valid.
This is better for developers — less administrative burden on constrained sites — and better for biodiversity outcomes. A well-managed habitat bank delivers far more durable, higher-quality habitat than a token intervention on a building site.
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Trading Boundaries Are Changing
BNG units will now be traded within Local Nature Recovery Strategy (LNRS) boundaries, replacing the current system based on Local Planning Authority areas and National Character Areas.
For Dorset, this means the Dorset LNRS boundary becomes the key trading geography. Developments anywhere within that boundary can purchase units from habitat banks within the same LNRS area. This is a welcome simplification — one clear boundary instead of the current patchwork.
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Self-Build Exemption Removed
The existing self-build and custom housebuilding exemption is being scrapped. It is replaced by the broader 0.2 hectare area-based exemption, which is simpler and does not require developers to prove self-build status.
### New Exemptions Introduced
Several additional categories will also become exempt:
- Temporary permissions of 5 years or less
- Development whose primary purpose is biodiversity conservation or enhancement
- Improvements to parks, playing fields and public gardens
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NSIPs Are Finally In — From November
BNG will become mandatory for all NSIP applications submitted on or after 2 November 2026. This date has slipped twice already, but it is now formally confirmed.
The key details:
- The 10% BNG target is retained, consistent with the wider planning regime
- A new BNG boundary replaces the full order limits — only habitats actually impacted by development need to be included in the baseline. This is significant for large linear schemes like roads and railways, where order limits can cover vast areas
- On-site and off-site gains are treated as equivalent in the hierarchy
- Temporary loss exemptions are extended from 2 to 5 years for low and very low distinctiveness habitats, reflecting NSIP construction timescales
- Statutory credits remain a last resort
This opens a significant new market for off-site units. Large infrastructure projects rarely have the space or inclination to deliver everything on-site.
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What This Means
The 0.2 hectare exemption will reduce overall demand — the government says so explicitly. But it also concentrates the remaining demand onto larger, more complex developments that are more likely to need off-site solutions. The hierarchy change for minor development actively encourages going off-site where it makes more sense. And NSIPs coming online in November creates entirely new demand that did not exist before.
These reforms feel like the government tidying up the elements that were not working — disproportionate burden on small sites, an overly rigid hierarchy — while keeping the core policy intact. BNG is not going away. It is maturing.
If you are working on a development in Dorset and need off-site BNG units, The Ferals can help. Our habitat bank at Tarrant Keyneston is registered on the Natural England BNG Register (BGS-180925001) and offers a range of habitat types including traditional orchard, grassland, and hedgerow units.
Get in touch to discuss your project's requirements.
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Sources: [Government response — improving BNG for minor, medium and brownfield development](https://www.gov.uk/government/consultations/improving-the-implementation-of-biodiversity-net-gain-for-minor-medium-and-brownfield-development/outcome/government-response-and-summary-of-responses) |
