950: Update on the cross-sectoral National Policy Statement, Sizewell C and Parliamentary shenanigans
Today’s entry provides an update on the potential cross-sectoral National Policy Statement for infrastructure, the Sizewell C Nuclear Power Station, and a number of recent Parliamentary debates relating to infrastructure.
End of the road (for now) for the cross-sectoral NPS
Over the years there has been talk of a ‘super’ National Policy Statement for (all) infrastructure. The proposal was most recently referenced in a Business, Energy and Industrial Strategy Committee report on the revised suite of energy National Policy Statements. That committee recommended that the: ‘Department for Business, Energy and Industrial Strategy work with the Department for Levelling Up, Housing and Communities to consider the potential merits of implementing a single National Policy Statement across sectors with sub-sector statements linked to different technology developments. Consideration of this change should be assessed in the light of flexibility and the ability to review parts of the NPS more frequently.’
The recommendation gave an expectation that a conclusion would be provided by February 2023 – but the government has seemingly provided a clear response in the form of a recent written answer:
‘At present, the Government has no plans to create a single National Policy Statement for Infrastructure. Our strategies for infrastructure investment and performance are set out in the National Infrastructure Strategy (NIS) and Transforming Infrastructure Performance: Roadmap to 2030. The NIS includes ambitious reforms to the planning system for nationally significant infrastructure projects. Proposed infrastructure investments during the next decade are set out in the National Infrastructure and Construction Pipeline 2021, which identifies a pipeline of projects with a value of over £600 billion. The Pipeline is updated on a regular basis.’
This isn’t entirely surprising: leaving aside the ongoing review of the energy suite of NPSs (EN1 through to EN-5), the government announced a review of the National Networks NPS in the Transport Decarbonisation Plan, and a review of the NPS relating to nuclear (EN-6) in the Benefits of Brexit document. I’m sure that’s enough to keep the civil service busy for some time!
Update on Sizewell C
The government announced earlier this week that the special purpose vehicle established to promote the Sizewell C Nuclear Power Station would, subject to consultation with the Environment Agency, Office for Nuclear Regulation and Ofgem, be designated under the Nuclear Energy (Financing) Act 2022. Being designated under that Act enables the company to benefit from the Regulated Asset Base (RAB) model.
The RAB model was used for the Thames Tideway project and in effect allows for cost-sharing between consumers and developers (infrastructure costs are passed down to consumers via some mechanism such as their bills), and is to be contrasted with the Contracts for Difference model (used for Hinkley Point C) and direct investment (which at one point was considered for Horizon’s Wylfa Newydd Nuclear Power Station project). To cut a long story short, the government’s view is that the CfD model puts quite a lot of risk on investors (which may be more suitable where a particular project is subject to significant uncertainty) whereas the RAB model provides more comfort and cost saving (particularly on interest payments) where a project has more certainty. You can read the government’s views on this issue in their response to the RAB Model for Nuclear consultation.
Interestingly the government’s draft statement of reasons in relation to the Sizewell C projects records the following:
The Secretary of State is aware that there could be a perception of a conflict of interest between his role in determining the DCO application for the Sizewell C project and his role in determining whether or not to designate the nuclear company. To avoid any perceived conflict of interest, the Secretary of State will delegate the final decision on the DCO, which must be taken by the 8 July 2022, to another BEIS Minister.
Infrastructure-related Parliamentary proceedings
The big news is that the Second Reading for the HS2 Phase 2b Bill will be on 20 June 2022, leading to the kick off of the Petitioning period. But we don’t talk about Hybrid Bills in these parts. Over the last couple of months, Parliament has held a number of debates and proceedings relating to specific DCO projects.
Earlier this week, there was a debate on the Hinckley National Rail Freight Interchange as well as a debate on the MetroWest Portishead Railway scheme. Back in March there was a debate on the Lower Thames Crossing.
Interestingly, there was also a more general debate about ‘Solar Farms and Battery Storage’ in which a nod to future NPPF changes relating to solar is made by Eddie Hughes MP (the Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities):
On toughening up planning regulations in the NPPF to make sure that ground-mounted solar panels are not blighting the countryside, I can tell my hon. Friend the Member for North Wiltshire that we will consult on amending planning rules in England to strengthen policy in favour of solar development on non-protected land. We intend to do this while making sure that local communities continue to have a real say over applications, with all the existing environmental protections remaining in place, and we will publish the consultation in due course.
This exchange between the Under-Secretary of State and James Gray MP is amusing but also telling:
Eddie Hughes: At the moment, my understanding is that there is more or less a 50:50 balance between the production of solar energy in fields and on roofs. The Government intend to maintain that balance…
James Gray: …did I understand him correctly to say that he intends to maintain the split between green fields and roofs at 50:50? The whole thrust of the debate this afternoon has been that we do not want that maintained. We want significantly more solar power to be generated on brownfield sites and on buildings, and significantly less on fields. I would like to see it going to 70:30 or 80:20, or, come to that, 100% of solar farms being on reused land.
Eddie Hughes: It was meant to be reassuring. I was just saying that we will maintain the status quo at the very least, and that in terms of that balance it is not our intention to push for dramatically more farmland to be used for solar.
Somewhat relatedly, an interesting correction of the Parliamentary record relating to the NPPF can be seen here. Michael Gove had initially referred to ‘the national planning policy framework that will be published in July’ giving rise to interest that an NPPF update was imminent. This has now been corrected and what the Secretary of State had intended to say was that ‘a document setting out how we intend to change national planning policy that will be published in July’.