DEFRA Trading Platform

Solent Nutrient Trading Pilot Project: DEFRA, Natural England and Partnership for South Hampshire

 

About the Solent Nutrient Trading Pilot

The Solent area, like several other water catchments in England, is suffering from excess nutrient pollution, which is having adverse impacts on our internationally important wildlife habitats. This has led to challenges for new housing development as Natural England has advised that such developments should demonstrate ‘nutrient neutrality’; i.e. zero net impact by nitrogen pollution on the protected sites.

Objective of the Solent Nutrient Trading Pilot

The Solent nutrient trading pilot project seeks to develop and trial a nutrient trading process, testing the feasibility and costs of a market-based approach to trading nutrient credits.  We hope to match landowners willing to offer long term land use changes that will reduce nitrogen pollution with developers who need to invest, via an online platform trading nutrient credits. The project will also explore how multiple benefits for people and nature can be maximised (e.g. biodiversity gains, carbon reduction). It is being progressed alongside wider work on agricultural policy reform and investment in wastewater treatment works to tackle key pollution sources.

Who we are working with

The project team is working closely with key partners such as the local planning authorities (LPAs) that make up the Partnership for South Hampshire (PfSH), to understand the needs of key user groups: specifically, landowners, land managers, consultants, developers and LPAs. We are also working closely with Ministry of Housing, Communities and Local Government (MHCLG), Environment Agency and Forestry Commission.

Progress to date

1) User Research

  • We held virtual engagement events with landowners, developers and LPAs in late 2020 and followed up with 33 interviews with developers, landowners and consultants. Thanks again to all of those who contributed, we are grateful for the insights you have provided. This research will inform ongoing stakeholder engagement.
  • We also undertook a targeted landowner/land manager survey to build on what we heard in our initial interviews with landowners.
  • Key messages we have heard from you so far:
    • There is widespread interest in learning more about the pilot project across all key user groups;
    • Landowners are looking to apply for other schemes on the same parcels of land as nitrogen mitigation such as Environmental Land Management (E.L.M.), carbon offsetting and Biodiversity Net Gain;
    • Developers wish to know the cost and availability of mitigation land, or ‘credits’, when they are seeking land for projects;
    • All users want clear guidance on the process they need to follow.
  • We are currently working on answers to all the questions people have asked through this user research phase (see next steps).

 

2) Technical advice on market design

  • We recently secured expert advice on market options from economists at Exeter University, which we have used to inform the specification for the trading platform/process.

 

3) Water quality modelling and opportunity mapping

  • Initial high-level mapping and modelling work has been completed by the Environment Agency (EA) to better understand pollution sources and pathways as part of the Solent Agricultural Pollution Investigation (SAPI). We hope results will be used to fine tune priority locations for land use change so that mitigation will have the greatest impact on nutrient pollution reduction, these results are expected in early June.
  • In doing so, we are building our evidence on nitrogen pollution sources and pathways.

 

Next steps

  • We will be commissioning a contractor in late June to work with us to design the trading process, build the online platform and ultimately run the pilot trading process in early 2022. The specification for this work has been directly informed by the user research.
  • As we develop the detail of how the trading process will work, we want to continue engaging with stakeholders and testing our emerging thinking. We have put together a set of frequently asked questions (FAQs) and will pull together other guidance and test this with users to ensure it answers your questions about the project.
    • A link to some initial FAQs is included at the bottom of this page. We aim to update these regularly as we talk to stakeholders and develop the project further.
    • We are also developing an inventory of current mitigation project sites and some case study examples which will be made publicly available shortly.
  • We will also be commissioning further water quality mapping/modelling work to identify locations where land use change would maximise nitrogen pollution mitigation and deliver important wider benefits for people and nature.
  • We will be talking to farmers and landowners’ groups and encouraging individuals to explore potential opportunities with us on a one to one basis. We hope this will lead to the development of suitable mitigation projects that can be used for the pilot trading process in early 2022.

We are keen for stakeholders to remain involved in helping us develop the project and to maintain links with farmers, landowners and their representatives who will be instrumental in its success.

We will provide updates on the project via email regularly and will aim to consolidate any queries or questions into these updates. If you are interested in joining our mailing list or participating in the pilot, please contact us via the project email: Solent.Pilot@defra.gov.uk

Frequently asked Questions (FAQs)

Solent Nutrient Trading Pilot – FAQs for nutrient credit suppliers (farmers and landowners)

Frequently asked Questions – Solent Nutrient Trading Pilot July 2021

 

*This page is being provided by the Partnership for South Hampshire to host information from Defra relating to the Solent Nutrient Trading Platform.