Nearly half of all BNG applications to date would have been exempt under new rules
In December 2025, government announced a significant update to Biodiversity Net Gain (BNG) policy, introducing a new exemption for sites smaller than 0.2 hectares.
Pivotal new data from TerraQuest, operator of Planning Portal, shows that the new exemption would have excluded 43.1% of all BNG applications since the policy’s launch. This, however, only accounts for less than 1% of the total land area applied on.
This follows TerraQuest’s research last year, which found that 75% of planning applications expected to comply with BNG were instead claiming exemptions during the policy’s first year. The majority of these fell under the ‘de minimis’ exemption category, suggesting that smaller developments were facing challenges in meeting BNG requirements.
‘Pragmatic recalibration’ – but balance needed
All of this paints a complex picture. The new exemption could certainly ease BNG burdens on smaller developers, and our data suggests the environmental impact may be limited - but striking the right balance going forward will be crucial.
Geoff Keal, TerraQuest CEO:
“This move is a pragmatic recalibration of the BNG requirements to reduce the burden on developers of the smallest sites, while only removing a relatively small area of land from its scope.
“It aligns with the government’s push to accelerate housebuilding, and it is welcome to see smaller developers being more comprehensively recognised as a distinct group within the updated NPPF. However, while the revised threshold may offer SMEs greater flexibility, maintaining the strategic focus on protecting and strengthening ecological connectivity remains essential.
“The governments’ moves to support smaller housing developers, as well as their prioritisation of urban brownfield land, may mean that small sites begin to represent a larger proportion of the total land subject to planning applications. In that case, we’d start to see a greater percentage of land excluded from BNG.
“It’s also worth highlighting that these updates will certainly impact businesses operating within the BNG space, just as the BNG industry has begun to start developing. The priority now must be ensuring that the cohort of smaller sites which remain subject to BNG following this change fully understand and are comfortable with fulfilling their obligations.”
“It is critical that environmental requirements are kept under review to ensure an appropriate balance is maintained between environmental protection and development.”
Industry opinion
Naturally, both the policy update and our exclusive data are already having an impact across the built environment.
Oliver Lewis, Joe’s Blooms:
‘‘The introduction of an area-based threshold is a sensible first step towards simplifying BNG for smaller sites. However, the Government now needs to take steps to stop the misuse of existing exemptions. Replacing the old exemptions with a simple, clear, and properly policed set of area-based enforcement measures would provide certainty for developers and LPAs. It will also help ensure that the nascent BNG industry in the UK can invest in nature’s restoration at scale.”
Phoebe Tucker, Green Finance Institute:
"The provision of the Planning Portal's analysis highlights the growing momentum and legitimacy of the BNG landscape. While the data indicates that the proposed changes will have a limited impact on headline land area, ongoing analysis will be required to show the full picture. Policies like these are nuanced and can have broad impacts - such as the high ecological value of some small parcels of land, and the impacts of reduced demand in the off-site market, which currently heavily relies on fractional unit sales. As the full consultation response emerges, monitoring not just exempted land area, but how these changes affect development decisions, investment, and long-term nature recovery outcomes is imperative."
Shane Aherne, Edit Land:
“The proposed 0.2-hectare exemption is a welcome and practical step for small-scale development. In practice, it removes a significant layer of cost, delay and risk for minor schemes, helping smaller infill and edge-of-settlement sites become deliverable again. This will undoubtedly assist SME developers - whose presence in the market continues to decline and sadly now represent a much smaller share of housing delivery - in bringing forward high-quality, locally considered developments.
“However, the threshold itself feels somewhat arbitrary and may not go far enough. Biodiversity Net Gain is now shaping site selection, land values and layouts much earlier in the process, and in some cases has rendered otherwise sustainable small sites unviable due to high baseline values. While the industry broadly supports the principle of enhancing biodiversity, there is a growing consensus that the current system is overly complex. A simplified and more proportionate approach would better balance environmental outcomes with the need to deliver viable housing.”
Charlie Cliff, Cypher Climate Brokers:
“Raising the BNG exemption threshold to 0.2ha could be positive for smaller developers, helping to recognise their value in the market by reducing disproportionate costs and delays on very small sites. This may support viability, encourage delivery, and level the playing field with larger schemes better able to absorb BNG requirements.
“However, it also brings challenges. An area-based exemption does not reflect the ecological value of what is being lost, meaning small but high-quality habitats could still be impacted without mitigation. There is also a risk of cumulative losses across many small sites, which could undermine local biodiversity objectives”
Press response
Our unique data informs policy and evidences policy, which is why it’s had a breadth of coverage across industry and environmental press. You can find some of the key coverage below:
- Environment Journal: 43% of planning applications now exempt from Biodiversity Net Gain – EnvironmentJournal
- The Planner: New BNG exemption would have seen nearly 50% of applications not subject to requirements – data | The Planner
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