1032: A phantom DCO, a made DCO and four still standing DCOs

Today’s bumper entry reports on the grant of development consent for Net Zero Teesside, the curious case of the Medworth Energy from Waste Combined Heat and Power Facility, which seemingly had its consent withdrawn, and yet two more failed legal challenges to DCOs (this time against the re-litigation of the A303 Stonehenge and the A47 road projects).

Stone dead

The A303 Stonehenge DCO was first made in 2020, quashed, re-determined in 2023, and then subject to another legal challenge. Mr Justice Holgate, at the High Court has this week dismissed all of the grounds of challenge except one which is stayed pending the outcome of the Court of Appeal in relation the A47 projects (discussed below). It was he who allowed the challenge first time round, mind you.

Mr Justice Holgate’s characteristic barb is present throughout the judgment (referring the futility of the ‘scattergun’ approach of the claimants, he is ‘surprised to see the second example [relied upon by the claimant] was relied upon at all’, ‘absurd’, ‘hopeless’, ‘it was not easy to discern exactly what was the claimants’ legal complaint’). There were 8 grounds (all, except the carbon-A47 ground) which he found to be unarguable. Given the amount of DCO news this week, I am confining myself to Grounds 1, 2, 3, 5 and 6, which are the grounds that I think have useful lessons to learn.

The first of the claimants’ grounds was that there was a failure to reopen the examination and that this was in some way a breach of Article 6 of the ECHR. The High Court could not be clearer: ‘the court has not been shown anything to suggest that the officials handling the re-determination were any less qualified than the Panel of Inspectors to assess and interrogate those issues’. The bizarre suggestion that the relationship between the DfT and National Highways (the promoter) required re-opening the examination was also rejected (‘the officials handling the redetermination and advising the SST acted separately from other parts of the Department and IP1 [the promoter]’).

In rejecting this ground, the High Court makes a useful point in relation to business cases. There is a misplaced undercurrent that business cases are determinative, or a substitute, for planning decisions. They are not: business cases are for investment decisions, and planning decisions are regulated under the statutory terms of the Planning Act 2008. A low or high BCR says nothing – by itself – about whether the planning case for a project and compliance with policy is made out. Mr Justice Holgate agrees: ‘the cost benefit analysis was not a proxy for the overall planning balance or judgment to be made by the SST. It formed part of a value for money exercise.’

The second ground was fundamentally an alternatives ground, and, at least more interestingly, the Secretary of State had apparently failed to have regard to a ‘non-expressway’ option (by which the claimants meant a rail alternative). This multi-modal alternatives challenge was ‘hopeless’ according to the High Court, and a rail option was not a ‘genuine alternative’ because the promoter’s proposal ‘seeks to fulfil the objectives of Government policy.. and the Road Investment Strategy.’ Eminently reasonable conclusion, and it flows from many other decisions where the strategic objective of projects is clear enough to allow for even more obvious ‘alternatives’ to be dismissed.

The third ground was the allegation that the Secretary of State acted irrationally by giving no weight to the risk of Stonehenge being removed from the List of World Heritage Sites. For context, the Secretary of State’s decision letter noted that ‘if ‘it’ were to happen, it would happen as part of a separate process.’ The ‘it’ in question is the risk of delisting. Mr Justice Holgate is clear that ‘the SST was entitled not to second guess the outcome of any consideration… of delisting’ and, in any event, his view that there was less than substantial harm was consistent with the weight provided to the risk of de-listing.

The fifth ground was that the Secretary of State failed to have regard to an obviously material consideration, namely the Carbon Budget Delivery Plan (‘CBDP’) and the Net Zero Growth Plan (‘NZGP’) both published in March 2023. Those documents note that ‘risks to delivery [of carbon reduction targets] are highest where there is reliance on nascent or immature technologies and associated markets, such as zero-emission vehicles or flight technologies or utilisation of lower carbon fuel,’ There, say the claimants, the reliance therefore placed by the Secretary of State on future changes to conclude there was no material impact on carbon targets was irrational. The world stops, a man approaches, he reveals himself to be Mr Justice Holgate, and he whispers, ‘There is nothing in this complaint’ (paragraph 241). In short, those policies are consistent with the considerations taken into account by the Secretary of State, so the ground also failed.

The sixth ground was that given the decision to review the NPSNN (because it is out of date in relation to obligations under the CCA 2008), he failed to consider not applying policies on climate change in the NPSNN. This too was meritless: the existing NPS continues to have effect. The High Court considered that the draft NN NPS was appropriately considered. What’s more interesting is an obiter comment (at paragraph 249) where Mr Justice Holgate casts ‘serious doubt[s] as to whether the claimants are entitled to pursue’ such a ground given the clear statutory provision allowing for a NPS under review to continue to have effect.

The end of carbon challenges?

Probably not, but the judgment is very firmly making the already-low success rate of these challenges even lower still. As we previously noted, these challenges are somewhat bizarrely treated as though they are substantively new matters, but the principles are now well-trodden and the repeated challenges have consistently failed.

The Court of Appeal yesterday made the position even clearer. Above, we mentioned the A303 Stonehenge ground was stayed, but the result it was stayed for has now occurred. This case, published yesterday, relates to three A47 schemes. It was alleged by the claimant that the Secretary of State breached the EIA Regulations by failing to conduct any lawful cumulative assessment of the combined carbon emissions from the three A47 schemes, and that the calculation was only done for the particular A47 scheme under scrutiny. Except for the promoter of the schemes, each assessment was inherently cumulative.

Not to be outdone on colourful language, the Court of Appeal unanimously rejected this ground in fairly stark terms:

The Court of Appeal goes onto hold that the suggestion that just because the other A47 schemes would have been in the ‘do minimum and do something’ for the assessment of each A47 scheme, that there was some fault is incorrect. Each project was ‘procedurally independent, and the primary focus therefore had to be on the emissions from the Scheme by itself.’ Their Lordships go on to hold that they were ‘equally unimpressed by the argument’ that there was a failure to provide a cumulative assessment for the same reasons.

No doubt there will be attempts to re-litigate this, including by way of an appeal to the Supreme Court. My only comment is that both the A303 Stonehenge and the A47 court cases support the position set out here in relation to repeat, and persistently failing, litigation in the DCO context. I’d humbly suggest that this is an area where Government needs to decide whether we have the balance right in allowing spiralling costs on grounds which have now been pled to death.

Phantom of the opera (at Medworth)

Something rather bizarre happened this week. The government published a press release confirming it was granting consent to the Medworth Energy from Waste Combined Heat and Power Facility. The DCO and the decision letter were published on the PINS website. Then they were all taken down. The decision was due yesterday, and the DCO decision is now delayed. In the decision letter (which we’ve retrieved), the Secretary of State confirms that it was granting consent.

The PINS website, at the time of writing, now states that ‘We have removed previously published content. Clarification is being sought on the Medworth Energy from Waste Combined Heat and Power Facility Development Consent Decision. A further update will be provided in due course.’ How bizarre, as the band Cornershop would say. A full consideration of the decision (and how it compares to the phantom decision) will be provided when the DCO is (re?)made.

Here’s a question for you: section 118 of the Planning Act 2008 states that a legal challenge may commence before the end of 6 weeks starting with ‘the day on which the order is published, or (ii) if later, the day on which the statement of reasons for making the order is published..’ The decision letter (ie, the statement of reasons) and the DCO was published on 20 February – has the 6 weeks started running? If the Secretary of State makes the same decision, does the 6 weeks starting to run from that period? Answers on a postcard. By the way, ‘Medworth Power Facility’ can be turned into an anagram of ‘Certified Lymph Rot, Wow’.

Net Zero Teesside

Here’s our usual summary table for the grant of development consent for the Net Zero Teesside project:

• Project: Carbon Capture, Usage and Storage project comprising a new gas-fired electricity generating station, and a carbon dioxide (CO₂) pipeline network.
• Promoter: Net Zero Teesside Power Limited and Net Zero North Sea Storage Limited.
• Application made: 19 July 2021.
• Application decided: 16 February 2024 (~2 years and 7 months).
• Three inspectors: Kevin Gleeson, Susan Hunt and Beth Davies..
• 41 relevant representations (low).
• 261 questions in the first round (low to moderate).
• 6 Issue Specific Hearings, 2 Compulsory Acquisition Hearings, and 0 Open Floor Hearings (moderate).
• Two local impact reports.
• 1,583 documents were on the Planning Inspectorate web page on the date of the decision: very high.

Here are a few of the useful points to note from the decision letter.

First, the issue of s104 vs. 105 rears its head again. Readers will recall the rigamarole on whether section 104 or section 105 applied in relation to the Wheelaborator energy from waste DCO project. The former applies where a National Policy Statement has effect, and the latter applies where it does not. The former required decisions to be made in line with the relevant NPS, and the latter is broader requiring consideration of important and relevant matters.

On the Wheelaborator project, the 104 / 105 issue was important because deciding something under section 105 effectively gives more weight to local policies. The applicant challenged the decision on the basis that the SoS was correct to decide all of the project under section 104, but did not properly reconsider the section 105-reliant parts of the inspector’s reasoning. In a strange reversal during the hearing, the SoS changed his mind and agreed that he should have decided part of the project under section 105 after all, but that he would have reached the same conclusion.

In the case of Net Zero Teesside, there were some elements which were not straightforwardly within the rubric of the NPS – so would the Secretary of State consider that section 105 applies to those elements? No, and this is because the section 35 direction for the project specifically directed that the NPS should have effect in relation to the project.

Second point to note is that the ExA questioned why further consents were not included in the scope of a DCO. Two of those consents were storage permits for offshore works. The decision letter (wrongly) sets out this is because ‘they are not included in the list of prescribed consent regimes under Schedule 2 to the Infrastructure Planning (Interested Parties and Miscellaneous Prescribed Provisions) Regulations 2015’. Those regulations do not limit the scope of consents which may be disapplied, they merely require the consent of a discharging authority for particular consents. This fact is acknowledged in the Recommendation Report so this is likely just a transposition error.

Third point to note is useful reminder about the scope of alternatives. In particular, one interested party contended that alternatives to constructing a methane burning gas fired power plant at the centre of the wider CCUS network in Teesside have never been properly considered. The Secretary of State’s decision on this point is that such an alternative is ‘a fundamentally different project to the proposed development and that [the interested party has] not taken in to account the clear policy support in both the designated and draft NPSs for gas fired generating stations which are [carbon capture ready]’. Alternatives which are ‘not commercially viable, or alternatives which are vague or inchoate, can be excluded from consideration on the grounds that they are not important and relevant to the decision.’

Fourth point worth noting relates to the baseline for greenhouse gas emissions assessments. The promoter, in this case, suggested that the effects of GHG emissions from the Proposed Development as being both significant and beneficial. This is based on comparing the Proposed Development to a baseline of a similar CCGT operating without CCS. The discrepancy between using a no-CCGT baseline vs. a CCGT baseline was quite stark: the promoter submitted a figure of -32,556,291 tCO2e as the whole life GHG emissions from the Proposed Development and Offshore Elements while CEPP (‘Climate Emergency Policy and Planning’, ie the same Dr Boswell as above, it’s not just roads he doesn’t like) countered with a figure of +20,808,127 tCO2e.

The Secretary of State was concerned there was a ‘double counting’ error which arose from accounting for 90% carbon capture in the calculation of operational GHG emissions, and, later, deducted the carbon already accounted for in this calculation again. The promoter suggested that this was not the case, but – at least initially – ‘the Secretary of State considered that the Applicants’ response did not adequately address the purported double counting error.’ Ultimately, the Secretary of State favoured the higher carbon impact, and concluded that ‘the GHG emissions from the Proposed Development itself must result in negative weight in the planning balance’ (which, on the face of it, may seem odd for a carbon capture project).

Fifth interesting point is an issue which comes up a lot, and over which there is little consistency across DCOs: namely, the question of whether a DCO should include ‘consent provisions’ in relation to the compulsory acquisition powers in protective provisions for statutory undertakers. In this case the Secretary of State rejected them, and her basis is that ‘in light of the conclusion that the case for CA and TP has been made out, the Secretary of State does not consider the provision to be necessary and notes that such provisions risk impeding the Applicants’ ability to deliver the Proposed Development.’ A similar conclusion is littered in the detail of the decision in relation to other statutory undertakers. This is an area where selective reliance on single precedents is unlikely to assist, and all parties should watch out for misplaced attempts to cite one project as though it has decided the fate of all such claims (in either direction).

Finally, we previously noted that this project appeared to be the first time that a change request was made during the decision stage. The change is to remove part of a work and associated land rights.

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