Net Zero Carbon Development Plan Document - Regulation 19
(2)8 Carbon Offsetting
Policy NZC2(C): Carbon Offsetting
Where a development proposal of one or more new dwellings (C3 or C4 use class) and/or 1,000sqm or more of new non-residential floorspace, hotels (C1 use class) or residential institutions (C2 use class) cannot demonstrate that it is net zero carbon, it will be required to address any residual carbon emissions by:
- a cash in lieu contribution to the District Council's carbon offsetting fund
and/or - at the Council's discretion, a verified local off-site offsetting scheme. The delivery of any such scheme must be within Warwickshire or Coventry, guaranteed and meet relevant national and industry standards. If it is a nature-based carbon sequestration scheme, then it must be backed by the national government's Woodland Carbon Code initiative (or future replacement/equivalent national scheme) and meet the Warwickshire ecosystem service market trading protocol.
Where full compliance is demonstrably not feasible having regard to the type of development involved and its design, proposals must offset any residual carbon emissions to the greatest extent viable.
Contributions to an offsetting scheme shall be secured through Section 106 Agreements and will be required to be paid prior to the occupation of the development.
The amount of carbon to be offset will be calculated according to the SAP or SBEM carbon emissions submitted in the energy statement required under policy NZC(1). This must then be multiplied to reflect emissions over a period of 30 years from completion. Where "zero-carbon ready" technology is proposed, associated carbon emissions should be calculated in accordance with the stated national trajectory for carbon reduction of the energy source (i.e. annual Treasury Green Book BEIS projections of grid carbon intensity or future national equivalent).
The carbon offset contribution amount will be calculated within the energy statement at the submission of the application. It must then be recalculated at completion and pre-occupation. Where assessment undertaken at completion shows that there is a performance gap between the design and the performance of the completed building, carbon offsetting contributions will be required to reflect any associated additional carbon emissions not accounted for at the point of determination of the planning application and an adjusted payment made if necessary.
The carbon offset price is the central figure from the nationally recognised non-traded valuation of carbon, updated annually as part of the Treasury Green Book data by BEIS.
Funds raised through this policy will be ringfenced and transparently administered by the Council to deliver a range of projects that achieve measurable carbon savings as locally as possible, at the same average cost per tonne. The fund's performance will be reported in the Authority Monitoring report on: amount of funds spent; types of projects funded; amount of CO2 saved.
8.1 Offsetting should only be used where a developer has maximised on site carbon reductions through applying NZC2(A) and NZC2(B). Offsetting will only be acceptable where it is demonstrated that it is the only option available to enable necessary development to be brought forward. As such the Council considers offsetting to be an option of final resort. It has been estimated that it would take the planting of 160 trees to offset a 4 tonne carbon footprint.
8.2 Using the most up to date Standard Assessment Procedure (SAP) or SBEM, planning applications will be required to set out in full the anticipated annual operational carbon emissions from the development for each of the 30 years after completion. The sum of this will be the amount of carbon to be offset over the 30 year building life. The resulting financial contribution will be calculated as follows:
The estimated amount of residual CO2 emissions from the development over 30 years from the completion of the development, multiplied by the central carbon figure from the Treasury Green Book (data by BEIS) average carbon market price per tonne for the 12-month period preceding the completion of the development.
8.3 The carbon offset price of £245/tonne is the central figure for 2021 from the nationally recognised non-traded valuation of carbon, released annually as part of the Treasury Green Book data by BEIS. This is the same approach precedented in other local plan carbon offset schemes.
8.4 New development is expected to get as close as possible to zero-carbon on-site through fabric performance and the inclusion of renewable energy. Where residual carbon emissions are identified, the associated carbon emissions will be calculated in accordance with the stated national trajectories for the carbon reduction of the relevant energy source. As an example, if an electrical heating system based on supply from the national grid is utilised, the calculation of carbon emissions associated with this will be based on any published national government carbon reduction targets (including where possible a reduction trajectory) for the electricity grid. Where there are no published government targets, existing levels of carbon will be assumed unless robust evidence can be provided regarding future decarbonisation of the energy source.
8.5 Offset contributions will be paid into the Council's Carbon Offset Fund. Some carbon-saving interventions are more expensive while others will be cheaper, so the actual cost per tonne of carbon saved will vary between different projects. The Council's S106-based offset fund will support a portfolio of projects that deliver measurable carbon savings at an average cost per tonne equal to that paid per tonne by developers. This approach is precedented in other planning areas such as London.
8.6 This average cost of carbon savings delivered by the fund will consider the cost of fund administration, project identification and setup, and insurance against failure/reversal of delivered projects. Projects are yet to be formalised by Warwick District Council, but will deliver carbon-saving interventions that would otherwise not be deliverable with other available funds. Projects could include but are not limited to: renewable energy generation; energy retrofitting in existing buildings; large-scale tree planting. Projects will be delivered within Warwick District wherever possible but could include neighbouring authorities elsewhere in Warwickshire and Coventry and cross-border initiatives where there is a benefit to doing so (e.g. deliverability; economies of scale; social benefits). The same localism principles will be required in any alternative offsetting solution proposed by developers, whereby the Council will seek that the offsetting solution is delivered within Warwick District and/or delivers benefits to the district, and must contribute to securing a net zero carbon future for Warwick District.
8.7 In the event that Warwickshire County Council or Warwick District Council operate a local carbon market that gives value to the growth and enhancement of local natural assets, this will be the preferred scheme.
8.8 The Council will prepare and maintain supplementary planning guidance setting out how contributions to the Carbon Offset Fund will be utilised to enable net-zero carbon, and how the Council's discretion will be exercised with regards to assessing the acceptability of any alternative off-site offsetting solutions that may be proposed by developers. This will include a list of projects to be funded and regularly reviewed in line with the Council's Climate Emergency Action Programme to ensure that there is transparency throughout the process.
8.9 Monitoring of the funds and progress made by adopting this policy will be included in the Authority Monitoring Report produced annually and will include details of:
- The amount of carbon offset fund payments collected
- The amount of carbon offset fund payments spent
- Types of projects being funded
- Amount of CO2 offset and price.