Noise, Air, Odour and Light

The damage cost approach to air quality contributions

7 min readBy PlanScope Editorial Team

Air quality contributions are usually calculated from predicted emissions times a published cost per tonne. The errors sit in the assumptions, not the arithmetic.

When a council asks for an air quality contribution, the figure has almost always come from the damage cost approach: the emissions your development is predicted to release, in tonnes, multiplied by a published cost per tonne for each pollutant. The method is quick, it is transparent once you see the working, and it produces sums that range from a few thousand pounds to six figures on a large scheme. It also produces requests that fail the statutory tests for planning obligations when nobody checks the inputs.

Ask for the calculation before you agree the sum. Most authorities will send it, and the errors are usually in the assumptions rather than the arithmetic.

Where the approach comes from

Damage costs were developed by central government as a tool for appraising policy, not for pricing individual planning applications. Defra publishes values per tonne of pollutant, differentiated by pollutant and by the type of source, and updates them.

Local authorities began using those values in air quality mitigation guidance produced for planning purposes, and the practice spread. That origin matters when you are negotiating. The numbers were designed to compare national policy options, which is why they are averages rather than site specific figures, and why a scheme in a rural district can attract a contribution derived from values reflecting urban population exposure.

None of that makes the approach unreasonable. It makes it a starting point that has to be tested against the site.

What the calculation counts

The standard calculation has four elements: the emissions the development generates, the pollutants counted, the period over which emissions are summed, and the cost per tonne applied.

Emissions normally come from two sources. Road traffic associated with the development, calculated from predicted trip generation, vehicle kilometres and an assumed fleet composition. And building energy, where combustion plant is proposed, calculated from fuel use and plant emission rates.

Pollutants are usually nitrogen oxides and particulate matter, sometimes with sulphur dioxide and ammonia where relevant. The summation period is where authorities diverge most: five years is common, some use the assumed lifetime of the development, and the difference between the two changes the answer by an order of magnitude.

Input What to check
Trip generation Whether it reflects the consented use and the site's accessibility
Fleet composition Whether it assumes the current fleet or a projected cleaner fleet
Vehicle kilometres Whether trip length is local evidence or a national default
Assessment period Five years, a longer horizon, or development lifetime
Plant emissions Whether a heat pump scheme has been priced as if gas fired
Baseline Whether existing site emissions have been deducted

The last row is the one most often wrong. A change of use from a warehouse with lorry movements to residential flats may reduce emissions, and a calculation that ignores the extinguished use produces a contribution for an improvement.

Inputs an authority will expect

Supply the emissions calculation yourself rather than leaving the authority to build it. A calculation you have prepared, with sources stated, is easier to defend than one produced from defaults.

Provide the trip generation with the database and site selection criteria stated, the trip length assumption and its source, the assumed fleet year, the energy strategy with plant type and fuel, the floor area and use by class, and the baseline emissions from the existing use where one exists. Where the Energy Statement commits to electric heating with no combustion on site, say so in the air quality chapter, because the two documents are frequently read by different officers.

Trip based emissions fall quickly when the scheme's travel commitments are real. A Travel Plan with monitored targets, secured cycle parking and a car club offer changes the trip generation input rather than only the mitigation narrative.

How a contribution is justified as necessary

An obligation may only be taken into account where it is necessary to make the development acceptable in planning terms, directly related to the development, and fairly and reasonably related in scale and kind, under regulation 122 of the Community Infrastructure Levy Regulations 2010.

Apply those tests to the request. If the air quality assessment concludes the effect is not material and no mitigation is required, a contribution is difficult to characterise as necessary to make the development acceptable. Where the effect is significant and on-site mitigation cannot address it, a contribution is far easier to justify.

Two further checks. Is the contribution supported by an adopted local plan policy or an adopted supplementary planning document, since a request resting only on an officer's practice is weaker. And does the authority already collect the Community Infrastructure Levy for measures that overlap with the proposed spend, which risks charging twice for the same effect.

Spending the money and monitoring it

A contribution that cannot be spent on anything identifiable is the weakest kind of request.

Ask what the money will fund, when, and how the authority will report it. Air quality action plans usually identify measures, and a contribution tied to a named measure in an adopted action plan is both more defensible for the council and easier for the applicant to accept. Authorities publish infrastructure funding statements annually, which show what was collected and what was spent, and that record repays a look before any negotiation.

Include a repayment clause. Where the sum has not been spent or committed within a defined period, it should return to the developer with interest. Authorities agree this more readily than applicants expect.

Challenging an excessive request

Negotiate on the inputs, not on the principle, unless the principle has no policy support at all.

The productive challenges are: an assessment period longer than the evidence supports, a fleet assumption that ignores projected improvement, trip generation taken from an unrepresentative site, failure to deduct the existing use, double counting between transport and energy emissions, applying damage costs to a pollutant the scheme barely emits, and requesting a contribution where the assessment already concludes there is no material effect.

Where agreement cannot be reached, the request can be tested on appeal, and inspectors do consider whether an obligation meets the regulation 122 tests. That is a slow and expensive route, so treat it as a negotiating position rather than a plan.

Recording it in an obligation

Get the drafting right and the clause is straightforward to discharge.

  1. State the sum, the index used and the base date for indexation.
  2. Identify the measure or category of measures the sum may be spent on.
  3. Set the payment trigger, normally before commencement or before first occupation.
  4. Include a spend-by date and a repayment mechanism.
  5. State the monitoring fee separately rather than rolling it into the contribution.
  6. Record any agreement that the sum satisfies the authority's air quality policy in full, so the point is not reopened at reserved matters.

An illustrative example: an 80 unit scheme on a former builders merchant inside an air quality management area. The council's opening request applies damage costs to 15 years of predicted traffic emissions with no deduction for the extinguished commercial use. The applicant supplies a calculation over five years, deducts the previous lorry movements, evidences all electric heating and a delivery management plan, and offers a contribution towards a named bus stop upgrade in the adopted action plan. The agreed sum is a fraction of the opening request, and the clause identifies where it goes.

Emissions evidence belongs in the Air Quality Assessment, and PlanScope drafts one from your site details and answers, structured to UK planning policy, flagging the modelling inputs a qualified author has to supply. Councils usually expect an air quality report from a practitioner with relevant experience, and professional review is strongly advised before submission.

This is general guidance, not legal advice; check the current damage cost values and your authority's adopted policy before relying on it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.

Frequently asked questions

What is the damage cost approach?

A calculation that multiplies the emissions a development is predicted to release, in tonnes, by a published cost per tonne for each pollutant. Defra publishes the values, differentiated by pollutant and source type. The method was designed to appraise national policy options, so the figures are averages rather than site specific numbers.

Which inputs change the answer most?

The assessment period and the baseline. Some authorities sum emissions over five years and others over the development's assumed lifetime, which changes the result dramatically. Failing to deduct the emissions of the use being extinguished is the second common error, and it can produce a contribution for a scheme that improves local air quality.

Can a council require a contribution where no mitigation is needed?

It is hard to justify. An obligation must be necessary to make the development acceptable in planning terms under regulation 122 of the Community Infrastructure Levy Regulations 2010. Where the assessment concludes there is no material effect and no mitigation is needed, the necessity limb of that test is difficult for the authority to satisfy.

Should the contribution be tied to a named measure?

Yes, and it helps both sides. A sum linked to a measure in the adopted air quality action plan is easier for the council to defend and easier for the applicant to accept. Ask for a spend-by date and a repayment clause returning unspent money with interest, which authorities agree to more often than applicants expect.

Does the Community Infrastructure Levy already cover this?

Sometimes it overlaps. Check whether the authority's levy funds transport or air quality measures that address the same effect, because charging through both routes risks paying twice. Also check whether the contribution rests on an adopted plan policy or supplementary document, since a request based only on officer practice carries less weight.

Sources and further reading

air qualitysection 106planning obligationsdamage costsmajor development

This article is general guidance about the planning system in England and, where stated, the rest of the UK. It is not legal or professional advice. Check your local planning authority’s validation requirements and take professional advice for your specific site.

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