Approved work: Nutrient trading markets

The Conservation of Habitats and Species Regulation 2017 requires that the condition of 27 protected sites is improved via nutrient neutrality in their given river catchment, applied by 72 local planning authorities. Nutrient neutrality seeks to prevent freshwaters in a catchment already polluted with nitrogen and phosphorus nutrients from sewage and agriculture being subject to increasing levels. The likely increase in nutrient levels from new developments is quantified and interventions are required to prevent the same amount from entering that catchment.

Nutrient trading involves allowing sources, both point and non-point, to trade nutrient reduction credits to achieve the local and regional water nutrient neutrality. For example, developers can bid for nitrogen and phosphorus credits generated by farmers and other landholders reducing agricultural pollution or wastewater treatment measures. For a development to gain planning permission, a Habitat Regulation Assessment should demonstrate these measures will ensure no increase in nutrient levels.

This POSTnote will summarise the benefits and challenges of the nutrient neutrality and trading concepts, evidence for the effectiveness of nature-based mitigation measures such as constructed wetlands, and implications of proposed regulatory changes under the Planning and Infrastructure Bill. Protected sites with Environmental Development Plans in place drafted by Natural England will require developer payments to the Nature Restoration Fund rather than purchasing nutrient credits.

Work will commence in April 2025, with publication expected in June 2025.  We will accept stakeholder contributions until 23:59 29 April 2025.