Introduction

This report comprises the Design Manual for Roads and Bridges (DMRB) Stage 3 Natural Capital Assessment (NCA) for the A9 Dualling Programme: Pass of Birnam to Tay Crossing (hereafter referred to as the proposed scheme).

Historically, Transport Scotland (TS) has explored how best to capture environmental outcomes within decision making and is fully committed to the protection and enhancement of the natural environment for transport projects.

A retrospective natural capital assessment (Transport Scotland, 2022), focussing on the Preferred Route Option as assessed within the Environmental Statement, was previously conducted for the A9 Dualling Programme: Pitlochry to Killiecrankie. The assessment enabled TS to consider the benefits of adopting a natural capital approach in the future and found that NCAs present an opportunity to reframe the way transport schemes interact with their surrounding environment and better identify the value of both the existing environment and proposed mitigation. Following on from this retrospective assessment, TS commissioned a NCA for the proposed scheme as part of DMRB Stage 3 environmental assessment process, building on the learning from the A9 Dualling: Pitlochry to Killiecrankie NCA.

It was identified that the Environmental Impact Assessment (EIA) processes could be supported by additional assessments to:

• Better identify the value of environmental mitigation and enhancement of schemes.
• Shift approaches from the traditional identification of adverse impacts to include scheme benefits and associated value.

A natural capital approach was identified as a potential approach to support the above and capture the true value of TS schemes.

Key concepts and definitions

The Scottish Natural Capital Accounts (SNCA) (Scottish Government, 2024d) define natural capital as “the stock of natural resources including air, water, minerals and all living things. These natural resources are crucial to the functioning of our society and economy as they underpin and provide a wide range of social, environmental and economic benefits to the people living and working in Scotland.”

Our stocks of natural capital provide flows of ecosystem services over time. These services, often in combination with other forms of capital (human, produced and social) produce a wide range of benefits to people individually and to wider society. These benefits may be direct or indirect and some of these benefits are less obvious than others but still exist and are nonetheless important. For example, ecosystem service benefits can include use values that involve interaction with the resource, and which can have a market value (minerals, timber, freshwater) or non-market value (such as outdoor recreation, or landscape amenity). They also include non-use values, such as the value people place on the existence of particular habitats or species (HM Treasury, 2024). The various types of ecosystem service benefits (as defined in the SNCA) are explained further below:

• Provisioning services: material outputs such as fish, timber, and fossil fuels.
• Regulating services: the regulation of natural processes that help to maintain the quality of the natural environment we rely upon, such as carbon sequestration (the removal of greenhouse gases from the atmosphere), air pollution removal and noise mitigation.
• Cultural services: non-material benefits such as recreation and aesthetics.

The ability of natural assets to provide goods and services depends on their quality, quantity, and location. These factors can, in turn, be influenced by background pressures or drivers of change, such as climate change and resource extraction (IPBES, n.d.), as well as direct interventions as a result of management practices. Some services may also need extra inputs to actualise benefits, (e.g. manufacturing to produce food from raw agricultural outputs) while in other instances, the benefit arises directly from the service without the need for additional capital or human input (e.g. carbon sequestration). The natural capital logic chain, as detailed in Defra’s (the Department of Environment Food and Rural Affairs) ENCA guidance (Defra, 2023), is summarised in Figure 1-1.

The key advantage of the use of natural capital approaches is to ensure that the benefits nature brings are not overlooked and can be protected and enhanced. A NCA aims to understand the baseline stocks of natural capital relevant to (which could be impacted by) a given scheme and the flows of ecosystem service benefits they generate, based on the above the logic chain. The assessment then looks to understand how these services (and associated value) will be impacted as a result of the scheme. As such, the approach provides a framework for improved appraisal of environmental effects alongside externalities (unintended negative environmental effects such as air and water pollution), which are typically the focus of environmental impact assessment (EIA). Figure 1‑2 below (taken from the HM Treasury Green Book (HM Treasury, 2024)) demonstrates this, with the focus of environmental assessment represented by the top row (‘environmental externalities’) and the focus of NCA represented by the bottom row (‘stocks of natural capital’ and ‘changes in environmental goods and services’). The figure thus depicts how NCA supplements and sits alongside, as opposed to attempting to replace, traditional environmental appraisal for a more comprehensive assessment of environmental and social impacts.

An NCA can add significant value to the appraisal process through a more holistic consideration of impacts, as well as the wider benefits schemes can generate as a function of environmental mitigation efforts and enhancements. It is recognised that in the context of the proposed scheme, there are likely to be both losses and gains of potentially high value habitats (such as woodland). It will thus be critical to understand the impacts to ecosystem services across the project lifespan, as part of the appraisal. The DMRB guidance sets out UK wide guidance on the development of trunk road schemes and provides guidance on environmental assessment, describing the level of assessment required at each of the key stages of development of a trunk road scheme. It should be noted that DMRB LA 108 Biodiversity (National Highways et al., 2020) section 2.1.1, Note 2 specifically promotes the inclusion of NCA within the environmental assessment, stating that “the reporting of the scale and nature of biodiversity changes can include ecosystem services assessment, natural capital assessment or biodiversity metric evaluation.”

In addition to acting as a standalone output contributing to appraisal and supplementing environmental assessment, NCAs can also add value in demonstrating alignment with key policies around wider benefits and environmental enhancements. In helping to identify opportunities to optimise socio-economic and environmental outcomes and being able to evidence the associated benefits, assessment outcomes can be used to support scheme consenting. In addition to the DMRB recommendation for the inclusion of NCA within trunk road environmental assessment, Section 1.3 below provides a summary of the relevant strategies, guidance and policies from Scottish Government and TS that are relevant to the range of ecosystem services considered as part of this NCA.

Relevant strategies, guidance and policies

The Scottish Government has recognised the urgent need to consider and address the issues of climate change and biodiversity loss together. The two are inextricably linked, with the changing climate driving the loss of biodiversity. Vice versa, the destruction of ecosystems is affecting the ability of nature to mitigate the impacts of, and our vulnerability to, climate change. Nature plays a critical role in the regulation of greenhouse gases, sequestration of carbon emissions and protection against extreme weather. As a result, as part of The Scottish Biodiversity Strategy to 2045 (Scottish Government, 2024c), the Scottish Government has declared twin, interlinked crises of climate change and biodiversity loss. Scottish Ministers have agreed two key commitments:

• A halting of biodiversity loss by 2030; and
• And to reach Net Zero emissions by 2045, whilst restoring and regenerating biodiversity.

The Biodiversity Strategy, in recognition of the contribution that natural capital makes to underpinning our society and economy, also states that by 2045: natural capital will be embedded in policy making; ecosystems will be diverse, healthy, resilient and deliver a wide range of ecosystem services; and that nature-based solutions will be central to efforts to deliver NetZero and adapt to climate change.

The Edinburgh Declaration (Scottish Government, 2022) recognises the link between climate change and biodiversity and seeks nature-based solutions for transformative change – this established a definitive framework for action to be adopted and embraced by all public sector organisations in Scotland.

The National Planning Framework 4 (NPF4) (Scottish Government, 2023a) states ‘to respond to the global biodiversity crisis, nature recovery must be at the heart of future places. We will secure positive effects for biodiversity, create and strengthen nature networks and invest in nature-based solutions to benefit natural capital and contribute to net zero’. Policy 4 states a requirement to “protect, restore and enhance natural assets making the best use of nature-based solutions” to ensure that “natural assets are managed in a sustainable way that maintains and grows their essential benefits and services.”

The Scottish Government Draft Planning Guidance (Scottish Government, 2023b) on Biodiversity, which sets out the Scottish Ministers’ expectations for implementing NPF4 policies which support the cross-cutting NPF4 outcome ‘improving biodiversity,’ lays out a number of core principles, one of these being to ‘integrate nature to deliver multiple benefits.’ The principle states that, “development should consider opportunities to maximise contributions to ecosystem services more generally and deliver multiple benefits for both people and nature.”

Scotland's National Strategy for Economic Transformation (Scottish Government, 2022) discusses natural capital in the context of a ‘nature-positive economy’ citing how ‘rebuilding Scotland’s natural capital is key to long-term productivity of the many sectors of our economy which rely on the resources and services nature provides’. It also states that Scottish Government is committed to ensuring that local communities are empowered and benefit from investment in natural capital.

The Infrastructure Commission for Scotland recognised the role of infrastructure in supporting environmental as well as social and economic outcomes. Natural infrastructure has since been included within the definition of infrastructure in Scotland’s Infrastructure Investment Plan to 2025-26 (Scottish Government, 2021). The plan recognises that natural capital is ‘fundamental’ to Scotland’s ‘economy and wellbeing,’ and the contribution that investment in natural infrastructure can have toward amenity, wellbeing, economic growth, reducing carbon emissions, climate adaptation and wider benefits.

NatureScot is committed to integrating natural capital into decision-making and investment strategies. This has been reflected in various recent natural capital initiatives, including:

• Scotland’s Natural Capital Asset Index (NatureScot, 2023) – NatureScot developed the index to help track the contribution of ecosystems to wellbeing and prosperity at a national scale. The tool is intended to promote the inclusion of nature in policy decisions, where it has been historically overlooked.
• Landscape Scale Natural Capital Tool for Scotland (NatureScot, 2025) – NatureScot is in the process of developing a tool to support land managers in Scotland in using a natural capital approach to recognise the benefits delivered by nature in their decision making.
• NatureScot Natural Capital Account (Nature Scot, 2024)– NatureScot has tested a natural capital approach on land under its ownership/management to understand the benefits currently obtained. This will support them in considering how best to manage their land portfolio sustainably, in the future.

A natural capital approach is embedded within the Tayside Local Biodiversity Action Plan (Tayside Biodiversity Partnership, 2016), which considers the ecosystem services provided by Tayside’s natural assets throughout.

The quality and interconnectivity of ecosystems associated with TS’s assets are therefore required to be carefully managed to ensure they are in the best condition to mitigate and adapt to climate change and for delivering positive outcomes for biodiversity and society.

Natural capital is also linked to several TS policies such as:

• Fitting Landscapes (Transport Scotland, 2014), which is TS’s mandatory Landscape Policy. The key aims within this policy (such as enhancing and protecting natural heritage and building adaptability to change) can be supported by natural capital approaches.
• Landscape and Biodiversity (Transport Scotland, 2025), is TS’s published policy and states that wherever possible, any management interventions are designed to protect and enhance roadside biodiversity and respect and integrate with the wider environment, all of which an understanding of the baseline natural capital assets and values can help to achieve.
• The National Transport Strategy (Transport Scotland, 2020), sets out the vision for Scotland’s transport system over the next 20 years. There are four interconnected policies underpinning the vision, with ‘take climate action’ and ‘improves our health and wellbeing’ being supported by the integration of natural capital approaches. Each year, delivery plans are developed which set out how TS will deliver against the four policy pillars. Consideration of natural capital can help support the development of these plans and delivery, for example supporting prioritisation of habitat creation to deliver multiple benefits.

Transport Scotland’s approach to climate change adaptation and resilience (Transport Scotland, 2023), sets out the vision for a well-adapted transport system in Scotland which is resilient to current and future impacts of climate change. The vision will be delivered through TS’s Adaptation and Resilience Framework which is developed to address the 7 climate risks to transport as set out by the Climate Change Committee. An understanding of natural capital assets can help to identify habitats providing carbon sequestration services and support holistic catchment management, delivering benefits across multiple ecosystem services, such as hazard regulation.

In addition to the relevant Scottish Government and Transport Scotland strategies, the community engagement undertaken as part of the project resulted in a series of community objectives being developed (further detail on this can be found in the DMRB Stage 3 Environmental Impact Assessment Report (EIAR) Chapter 7: Consultation and scoping). Some of these are particularly relevant to this NCA, including the following objectives:

• Reduce current levels of noise and pollution in the villages of Dunkeld, Birnam and Inver to protect human health, and well-being of residents and visitors and to enable them to peacefully enjoy their properties and amenity spaces.
• Protect and enhance the scenic beauty and natural heritage of the area and its distinctive character and quality
• Examine and identify opportunities to enhance the levels of wheeling, cycling and walking for transport and leisure, including the improvement of existing footpaths and cycle ways, to promote positive mental health and well-being.
• Preserve and enhance the integrity of the unique and rich historical and cultural features of the Dunkeld, Birnam and Inver communities, thereby supporting well-being and the local economy.

Aims and objectives

The NCA at DMRB Stage 3 aims to understand the natural capital asset base relevant to, and how this will change as a result of, the proposed scheme and the consequent impacts on ecosystem service benefits. The following objectives have been set out for the delivery of this aim:

• Produce a natural capital asset register for the NCA boundary (see definition in Section 2), quantifying the stocks of natural capital under a baseline and post-development scenario;
• Identify the ecosystem service benefits which could be impacted by the proposed scheme and assess the potential impacts in qualitative, and where possible, quantitative and monetary terms;
• Identify key risks and opportunities related to natural capital to provide recommendations for the ongoing proposed scheme development;
• Assess natural capital impacts in such a manner that they could demonstrate the consideration of relevant legislation and policy identified in Section 1.3 and the business case for the proposed scheme;
• Demonstrate alignment with the DMRB Stage 3 Environment Impact Assessment Report (EIAR), recognising and, where possible, utilising the outcomes from relevant disciplines to inform the assessment of ecosystem service impacts. The NCA will thus supplement the EIAR to provide a more a comprehensive understanding of the impacts of the proposed scheme.

Approach

The remainder of this report is set out according to five key analytical steps involved with delivering a NCA, following the logic chain set out in Figure 1‑3. For each of the steps, the analytical approach (methodology) is explained, followed by the outcomes for that step.