Guidance

Local Nutrient Mitigation Fund Round 2: expression of interest

Updated 25 April 2024

Applies to England

As confirmed in the Autumn Statement 2023 and announced on 19 December, the government has committed to providing direct grant funding to local planning authorities to deliver high quality, locally-led nutrient mitigation schemes.

Round 2 of the government’s call for expressions of interest seeks high quality proposals to boost the supply of mitigation and that the government can fund.

Introduction

Nutrient pollution is an urgent problem for our freshwater habitats and rivers, many of which are internationally important for wildlife. While the government recognises the need to protect these habitats, and is taking steps to address the underlying pollution, it is important to acknowledge the significant burden nutrient neutrality has placed on housebuilders despite the limited impact extra wastewater from residents in new developments has on waterbodies.

In line with the ambition to support the environment and enable sustainable development, we recently confirmed £110 million for the Local Nutrient Mitigation Fund, to deliver local nutrient mitigation schemes which will boost the supply of mitigation available to support housing delivery and sustainable development.

This funding works alongside the Natural England - Nutrient Mitigation Scheme to increase the capacity to deliver − boosting the supply of mitigation where it is needed. This will ensure we are able to move forward with delivering the homes we need.

Approach

This funding complements existing action being taken by the government, which include meaningful steps to reduce pollution at source and ameliorate the issue of nutrient neutrality. Further details of the action being taken by government can be found in the Nutrient Neutrality Update.

Where high quality proposals are identified in line with the relevant criteria, the government will provide funding to support clearer routes for housing developers to deliver ‘nutrient neutral’ sites in line with their environmental obligations.

This expression of interest invites Local Planning Authorities affected by nutrient neutrality advice to submit costed expressions of interest for programmes or strategies to deliver nutrient mitigation. The aim is to boost the supply of nutrient mitigation available locally, to enable housing delivery in catchments of Habitats Sites affected by nutrient pollution, with the funding being recycled locally.

For most catchments of Habitats Sites, the area covered expands beyond the boundaries of a single local planning authority - it is therefore important that strategic mitigation solutions are delivered, and catchment-based approaches are prioritised.

Due to the scale of stalled housing delivery, it is unlikely that a single mitigation measure alone will provide a long-term, sustainable supply of mitigation. As such, it is expected that proposals will come forward as part of a wider strategy. We therefore welcome strategies and programmes which can ensure the sufficient supply of both interim/bridging mitigation and in-perpetuity mitigation within catchments to unlock housing as quickly as possible. We expect proposals to have regard to forthcoming upgrades to wastewater treatment works following the designation of nutrient sensitive catchment areas.

We are open to receiving proposals for both blue/green and grey infrastructure (ie nature-based solutions as well as efforts to fix legacy infrastructure issues like septic tank upgrades). We encourage proposals for innovative and technical solutions for reducing nutrient pollution and so generating mitigation.

Round 2 is open to all nutrient neutrality catchments. Funding will be prioritised to the bids demonstrating need and impact particularly those catchments that have not yet received, or low levels, capital funding to boost mitigation.,

We are requesting capital bids of up to £10 million (from a single catchment or area where two catchments overlap). Any funding awarded will be as a grant, paid from DLUHC to a lead local planning authority for catchment-level working.

The funding will be used cyclically within the catchment until nutrient mitigation credits for development are no longer needed. At this point, recovered funds should be invested in measures identified as part of actions to help restore the relevant Habitats Sites to a favourable condition, including as part of a Protected Site Strategy or Nutrient Management Plan if applicable.

The government, drawing on expertise of the Department for Environment, Food and Rural Affairs (DEFRA), Natural England and relevant arms-length bodies, will consider expressions of interest based on the responses to the questions set out below.

See details of the original Local Nutrient Mitigation Fund Call for Evidence.

Call for expressions of interest

Questions

Section 1: Contact information

1. Please state the local planning authority name.
2. Please state the local planning authority named officer and contact details.
3. Please state the catchment(s) affected.
4. Please state the type of nutrient pollution in the catchment.
5. Are you responding for an individual local planning authority or on behalf of a number of local planning authorities? Do these local planning authorities cover the whole catchment area?
6. If you are responding for a single local planning authority, does the local planning authority cover the whole of the nutrient catchment? If not, please outline why a joint return is not being made alongside other affected local planning authorities.
7. If you are responding on behalf of a number of local planning authorities as a consortium please list those local planning authorities.

Section 2: Mitigation supply

8. As a result of DLUHC funding, how many homes will mitigation be available for within six months?
9. As a result of DLUHC funding, how many homes will mitigation be available for within 6-12 months?
10. As a result of DLUHC funding, how many homes will mitigation be available for within 12-24 months?
11. As a result of DLUHC funding, how many homes will mitigation be available for in total?
12. What percentage of mitigation credits required for your catchment will the DLUHC funding help?

Section 3: Mitigation

13. Are you mitigating Nitrate, Phosphorus or both?
14. How many “kG/yr” mitigation will be delivered? Please estimate and summarise the calculations and main assumptions behind this.
15. Will the mitigation be interim/bridging (up-to 2030), in-perpetuity, or both?
16. Do the measures accord with the Habitats Regulations Assessment (HRA) requirements in your opinion?
17. Which areas of the catchment are you targeting? One, some or all?
18. What are your proposed mitigation measures? Please list all of them.
19. The DLUHC funding should be recycled (for example, once developer payments are made).  Please briefly confirm this and outline how you plan to facilitate this.
20. What are the additional benefits this DLUHC funding brings as opposed to existing nutrient mitigation schemes in the catchment? Why are LA led mitigations needed?
21. Is there evidence to support the answers above, such as technical reports? Please list this below or send evidence for this question to Nutrient.PPD@levellingup.gov.uk.

Section 4: Secondary benefits

22. What are the secondary benefits? Examples may include enhanced public access to nature, natural flood risk management, improvements to legacy infrastructure which otherwise would not be improved.
23. Will the proposal deliver or aim to deliver forthcoming site restoration for the Habitats Site and remove the need for nutrient neutrality?
24. How will you support small sites and small and medium sized enterprise (SME) builders and their developments and how will mitigation be allocated towards supporting small sites and SMEs?
25. Will the mitigation be used for other economic development, such as overnight accommodation or tourism?
26. Will the proposal support emerging Local Plans in the catchment?

Section 5: Funding

27. What is the total funding for 2024/25 you are seeking from DLUHC? Funding will need to be committed in 2024/25.
28. If applicable, what is the total match funding being contributed on top of DLUHC funding?
29. Please outline the estimated cost of each measure/intervention (DLUHC funding and match funding). Please list them all.
30. What is the anticipated cost of mitigation credits per kilogram of Nitrate?
31. What is the anticipated cost of mitigation credits per kilogram of Phosphorus?
32. What is the developer cost per dwelling for each scheme?
33. How is your proposal value for money?
34. Please outline how you have accounted for inflation in your costings.

Section 6: Delivery

35. At what state of delivering the mitigation measures are you?
36. Are there any innovative measures being used?
37. Do the measures form part of a wider nutrient mitigation strategy? If yes, please explain.
38. How will you ensure there is capacity to deliver proposed mitigations within your LPA?
39. What feasibility work has happened? If none, please outline a timeline.
40. List any Environment Agency engagement including which local Environment Agency teams on permitting issues.
41. Please outline the key delivery partners. Who will deliver the mitigation?
42. Please confirm that you will not be using Grade 1 farmland to deliver the scheme.
43. Where available please provide any data on the Agricultural Land Classification of any land you will be using to deliver the scheme.
Any submissions that propose potential conversion of land from alternative uses should note other relevant government commitments such as to food security, which will be considered as part of the funding allocation process.

Section 7: Risks

44. What are the key risks to delivery and success, and how are you mitigating these?
45. When considering risks, what have you done to consider potential licences and/or consents required that may limit nutrient mitigation?

Geographical scope

This expression of interest relates to England only and is targeted at local planning authorities affected by ‘nutrient neutrality’ advice (see Annex).

Duration

This expression of interest will close on 26 April 2024.

How to respond

To submit an expression of interest, please complete the form.

If you would like to submit any supporting documents with your response, please label which question they pertain to and send them to Nutrient.PPD@levellingup.gov.uk. Please mark the subject as Supporting Documents - Local Nutrient Mitigation scheme – [Local Planning Authority Name].

It is expected that a response will be submitted by a local planning authority on behalf of all affected local planning authorities in catchments or, if appropriate, by individual local planning authorities.

Next steps

The Planning Advisory Service will provide support to local planning authorities as part of the on-going support for local planning authorities affected by nutrient neutrality advice. Further details of this support may be found on the Planning Advisory Service website.

When the expression of interest closes, the government will consider the responses and contact relevant local planning authorities regarding funding.

Enquiries

For any enquiries on this, please contact Nutrient.PPD@levellingup.gov.uk