The proposal set out binding rules and targets to restore ecosystems with the goals of both ensuring recovery to biodiverse and resilient nature, and of contributing to climate change mitigation and adaptation.

Now that Member States have, in the European Council, adopted the consolidated text of the proposal, it will be published in the OJEU and enter into force 20 days later. It will be directly applicable in Ireland.

The proposal flowed from UN commitments and the EU Biodiversity Strategy for 2030, part of the European Green Deal to decarbonise the economy. Decarbonising the economy will require significant new infrastructure. The Commission considers tackling climate change and securing biodiversity to be interlinked, with nature and nature-based solutions (like carbon stocks and sinks) being fundamental to climate action.   

In its impact assessment, the Commission estimated the key benefits of restoring ecosystems to be €1860 billion, as against an estimated cost of less than a tenth of that figure: €154 billion.

What does the proposed Regulation aim to achieve?

Barriers to the success of biodiversity policy include lack of legally binding targets, shortcomings in existing environmental law, and lack of an integrated approach across policy areas.

The Regulation will therefore set an overarching objective for Member States to put in place effective, area-based restoration measures with the aim of covering at least 20% of in scope areas by 2030, and all ecosystems in need of restoration by 2050.  

The Regulation then provides for eco-system specific targets, outlined below.

What are the targets for restoration of terrestrial, coastal and freshwater ecosystems?

Restoring degraded habitats

Member States will have to put in place ‘restoration measures’ necessary to improve to ‘good condition’ areas of habitat types listed in Annex I which are not in good condition for at least 30% of the total area of all habitat types not in good condition by 2030. These targets will rise to at least 60% by 2040 and at least 90% by 2050.

Derogations have been introduced to the text. Member States may, where duly justified, apply lower targets in respect of very common and widespread habitat types that cover more than 3% of their territory. This is significant in Ireland where, according to Teagasc, peat soils cover 21% of the land surface.

Re-establishing habitats

Member States will have to put in place restoration measures necessary to re-establish Annex I habitat types in areas where those habitat types do not occur, with the aim of reaching the ‘favourable reference area’ of those habitat types. The measures will be required on areas representing at least 30% of the additional surface needed to reach the total favourable reference area for each group of habitat type by 2030. These targets rise to 60% by 2040 and 100% of that surface by 2050.

Member States which consider it not possible to meet the 2050 target may be permitted to set a lower target for 2050 (between 90% and 100%). 

Restoring habitats of species

Member States will have to put in place restoration measures for habitats of the species listed in annexes of the Habitats Directive, and of birds in the scope of the Birds Directive, necessary to improve the quality and quantity of those habitats, including by re-establishing them, until sufficient quality and quantity of those habitats is achieved.

Overall, Member States must put in place measures that aim to ensure that areas subject to restoration measures show a continuous improvement until good condition / sufficient quality of habitats is reached. Where good condition / sufficient quality of the habitats is reached, measures must aim to ensure such habitats do not significantly deteriorate.

What are the habitat types listed in Annex I?

Extensive habitat types are listed under the following categories: (1) wetlands (coastal and inland), (2) grasslands and other pastoral habitats, (3) river, lake, alluvial and riparian habitats, (4) forests, (5) steppe, heath and scrub habitats, and (6) rocky and dune habitats.

Are marine ecosystems addressed?

Provisions structured similarly to those outlined above address the restoration and re-establishment of Annex II habitat types and marine habitats of species.

Annex II sets out extensive lists of habitats under the following categories: (1) seagrass beds, (2) macroalgal forests, (3) shellfish beds, (4) maerl beds, (5) sponge, coral and coralligenous beds, (6) vents and seeps, and (7) soft sediments (above 1000 metres of depth).

How does the Regulation build on existing environmental law?

The intent is to complement the Birds and Habitats Directive, which do not set deadlines for maintaining or restoring natural habitats and species to favourable conservation status, and do not require restoration of ecosystems outside the Natura 2000 network of protected areas designated under those Directives. Member States should, up to 2030, prioritise Natura 2000 sites when putting in place measures to restore habitat types to good condition.

The Regulation also seeks to complement the Water Framework Directive, the Marine Strategy Framework Directive and the Invasive Species Regulation.

How does the Regulation address existing obligations to accelerate deployment of renewable energy infrastructure?

Failure to meet obligations around continuous improvement and prevention of deterioration of habitat types / habitats of species can be justified if caused by: (i) a project of overriding public interest for which no less damaging alternative solutions are available, to be determined on a case-by-case basis (outside Natura 2000 sites), or (ii) a plan or project authorised in accordance with the overriding public interest provisions of the Habitats Directive (inside Natura 2000 sites). This applies to terrestrial, coastal and freshwater ecosystems, as well as marine ecosystems.

For the purposes of the above derogations for areas outside Natura 2000 sites, plants for the production of energy from renewable sources, their connection to the grid, the related grid itself and storage assets, should be presumed by Member States as being of overriding public interest. Member States may exempt such projects from the requirement that no less damaging alternative solutions are available, provided that a strategic environmental assessment has been carried out and they have been subject to an environmental impact assessment. 

The Regulation also requires Member States to coordinate the development of national restoration plans (see below) with the designation and functioning of their renewables go-to areas (under the Recast Renewable Energy Directive).

What about the urban environment?

Up to 2030, Member States must ensure that there is no net loss of urban green space and urban tree canopy cover.

After 2030, Member States must achieve an increasing trend in the total national area of urban green space, including through integration of urban green space into buildings and infrastructure, as well as an increasing trend in urban tree canopy cover, until a satisfactory level is reached (as determined by guiding frameworks to be made under the Regulation).

What further areas are covered?

The Regulation includes obligations to restore natural connectivity of rivers and natural functions of the related floodplains; pollinator populations, agricultural ecosystems, and forest ecosystems.

This includes an obligation to put in place measures which shall aim to restore organic soils in agricultural use constituting drained peatlands. The measures must be in place on at least 30% of such areas by 2030 (of which at least a quarter shall be rewetted), 40% of such areas by 2040 (of which at least a third shall be rewetted), and 50% of such areas by 2050 (of which at least a third shall be rewetted).

Member States may include restoration measures in areas of peat extraction in meeting these targets. They may also achieve up to 40% of the targets through restoration measures on drained peatlands under land uses other than agricultural use and peat extraction. 

What are the governance structures around implementation?

Member States will prepare national restoration plans to cover the period up to 2050 which must include intermediate deadlines.

The first draft plan is required 24 months after the Regulation enters into force. The Commission will assess the plans, and Member States must take into account any observations when finalising them. Revised plans will be due by mid-2032 and 2042.

In preparing plans, Member States are required to take into account the governance framework under the Energy Union and Climate Action Regulation, as well as measures developed under other policy areas including environment and agriculture.

Member States will have obligations to carry out preparatory monitoring and research to identify the measures needed to meet targets, as well as ongoing monitoring and reporting to the Commission across a range of indicators.

Will there be funding?

National restoration plans must include estimated financing needs, including a description of support for stakeholders affected by restoration measures or other new obligations under the Regulation, and the means of intended financing, public or private, including co-financing with EU funding instruments. The Regulation identifies the EU budget and numerous EU financing programmes as sources of support.

Member States may promote the deployment of private or public support schemes to the benefit of stakeholders implementing restoration measures.

Next steps

Including biodiversity measures from an early stage of project development is not new for entities at the forefront of integrating ESG considerations into their decision-making processes.

While obligations in the Regulation are imposed on Member States, it will be prudent for developers to diligence technical provisions dealing for example with biodiversity indicators (and the Regulation provides for further delegated and implementing acts to be made in respect of indicators).

In the renewables sector, the wind industry at European level has indicated its support for the targets. As Ireland’s offshore planning progresses, it will be important to ensure strategic coherence as between, for example, its nature restoration plan and Offshore Renewable Energy Development Plan II. It will be important for developers to have clarity on how they can align with Irish development policy and nature restoration objectives.

Ireland’s draft nature restoration plan will not be available for two years. However, the Regulation indicates that it is important that the public is given early and effective opportunities to participate in the preparation of the plans. Member States will be obliged to ensure that the preparation of their plan is open, transparent, inclusive and effective and that the public, including all relevant stakeholders, is given early and effective opportunities to participate in preparation.

In the meantime, Ireland’s National Biodiversity Action Plan notes that 85% of our most precious EU-protected habitats are in unfavourable status. Almost half (46%) are demonstrating ongoing decline. It outlines the current roadmap of actions and the work of the National Biodiversity Data Centre, and points to €3.15 billion earmarked for climate and nature from the Infrastructure Climate and Nature Fund, as well a number of other domestic and EU funding instruments.

The authors would like to thank Enya Levy for her contribution to this briefing.