In this briefing, we consider recent planning developments in the energy sector. We select one consultation, one legislative development, one court case and one planning permission and comment on their implications.
Consultation - Government responds to consultation on National Infrastructure Commission
The National Infrastructure Commission (‘NIC’) was set up by the Government on an interim basis on October 5, 2015 in order to provide a long-term assessment of the UK’s infrastructure needs. The Government announced in May 2016 that it will bring forward legislation to place the NIC on a permanent independent footing as soon as parliamentary time allows.
The NIC will deliver a long-term plan and assessment of national infrastructure needs early in each parliament (a ‘NIA’), looking 30 years ahead across all key sectors of economic infrastructure including, but not limited to, energy, transport, water and sewage, waste, flood defences and digital communications. The NIC will also consider the potential interactions between its infrastructure recommendations and housing supply.
The Government held a 10 week consultation on the governance, structure and operation of the NIC between January 7 and March 17, 2016. In its response to the consultation, the Government states that it will aim to ensure that the NIC achieves the status of a non-departmental public body in order to provide it with the necessary independence from Government.
It is proposed that the NIC will, in addition to delivering the NIA once every five years, also complete specific studies on the most pressing and significant infrastructure challenges. The Government will set the terms for the specific studies and will aim to respond to all of the NIC’s recommendations in both the NIAs and specific studies within 6 months, with a statutory deadline of 12 months.
NIC recommendations that the Government intends to take forward will be accorded a special legal status, becoming ‘Endorsed Recommendations’ and government policy. Part of the consultation focused on the planning status of Endorsed Recommendations. The Government notes that Endorsed Recommendations are likely to be material considerations for decision makers both pursuant to the Nationally Significant Infrastructure Projects (‘NSIP’) regime and the Town and Country Planning Act 1990 (‘TCPA 1990’) regime.
The consultation proposed that the Government should update National Policy Statements (in accordance with which decisions pursuant to the NSIP regime must be taken and which are material considerations for decision making at local level pursuant to the TCPA 1990) to reflect Endorsed Recommendations. In its response to the consultation, the Government states that it will set out a timetable for reviewing a National Policy Statement in response to Endorsed Recommendations on a case by case basis. In the event of any conflict between National Policy Statements and Endorsed Recommendations, the Government will legislate to ensure that the Secretary of State can take a decision in line with an Endorsed Recommendation. Further, the Government will amend the National Planning Policy Framework so as to give decision makers clarity on how Endorsed Recommendations should be taken into account.
The Government’s decision to delegate powers to assess and make recommendations for the UK’s long-term infrastructure needs to a non-departmental public body represents an attempt to de-politicise a pivotal area of government policy. It recognises the inherent tension between the short-termism of parliamentary politics and the long-term approach required to deliver major infrastructure projects. Changes in the direction of government policy from one government to the next lead to wasted taxpayer expenditure, uncertainty for investors and a lack of cohesive long-term planning. A cynic might also observe that there is a temptation for Governments to bring forward projects on the basis of ulterior motives – providing a boost to a marginal seat, providing an economic stimulus, launching a so-called ‘vanity’ project. These are temptations which should prove less alluring to a dispassionate observer tasked with prioritising the UK national interest. The fact that Endorsed Recommendations will become part of planning policy indicates that the NIC’s findings will, once endorsed, have weight and will influence decision making in respect of major infrastructure projects at national and local level.
National Infrastructure Commission: response to the consultation, HM Treasury - May 2016
Legislation – onshore wind removed from NSIP regime
The Government has introduced legislation to remove large onshore wind farms from the ‘Nationally Significant Infrastructure Project’ (‘NSIP’) regime under the Planning Act 2008.
As a result, it will no longer be possible for developers of onshore wind farms of over 50MW capacity to apply for development consent pursuant to the Planning Act 2008. Applications made pursuant to this regime are determined by the Secretary of State. Instead, applications for such wind farms will be made to local planning authorities pursuant to the Town and Country Planning Act 1990.
The Government describes the motivation behind these amendments as “seeking to achieve the manifesto commitment to give local people a greater say in determining onshore wind applications”.
The amendments to the Planning Act 2008 are effected by the Infrastructure Planning (Onshore Wind Generating Stations) Order 2016 which came into force on March 5, 2016. These exclude generation stations which generate electricity from wind from the list of NSIPs set out in section 15 of the Planning Act 2008.
In order to ensure that removal from the NSIP regime does not result in applications for such onshore wind farms being made pursuant to section 36 of the Electricity Act 1989, the Government has also introduced the Onshore Wind Generating Stations (Exemption) (England and Wales) Order 2016 which came into force on March 1, 2016. This disapplies section 36(1) of the Electricity Act to onshore wind generating stations in England and Wales, save for any which were granted under section 36(1) before March 1, 2016.
These amendments are the latest in a series of measures introduced by the Government designed to give local communities more influence over applications for onshore wind farms. For instance, in a written ministerial statement on June 18, 2015, the Government announced that, when determining planning applications for wind energy development involving one or more wind turbines, Local Planning Authorities should only grant planning permission if the development site is in an area identified as suitable for wind energy development in a local or neighbourhood plan and, following consultation, it can be demonstrated that the planning impacts identified by affected local communities have been fully addressed and, therefore, the proposal has their backing. The Secretary of State for Communities and Local Government has only recently (end of June 2016) refused permission for a single wind turbine in Northamptonshire (against the recommendation of a planning inspector) on grounds of lack of evidence that local concerns surrounding the visual impact of the turbine had been addressed, hence the proposal not having the backing of the local community and, therefore, being contrary to the written ministerial statement.
Notwithstanding the move towards a more local-led approach, there is still an opportunity under section 35 of the Planning Act for the Secretary of State to give a direction for development to be treated as development for which development consent is required. This power applies when the Secretary of State thinks the project is alone, or in combination with other projects, of national significance. Therefore, there remains scope for certain applications for large onshore wind projects to be determined by the Secretary of State although this is unlikely under the current Conservative Government.
While the policy climate for new onshore wind farms is less favourable than was previously the case, developers should not be deterred but should focus attention on designated sites and also give significant consideration to engaging with local communities in order to gain their backing. A case to watch will be the called-in application by Peel Energy for an expansion to the Scout Moor wind farm. The application was recommended for approval by both Rochdale and Rossendale Councils, being deemed to meet the new tests set out in the written ministerial statement. The public inquiry opens on October 11, 2016.
Case review - High Court quashes planning permission for wind turbine over £1m community benefit donation
The High Court has quashed a wind turbine planning permission on the basis of the Local Planning Authority (‘LPA’) unlawfully treating the applicant’s offer to make an annual community donation from the profits of the turbine as a material consideration in the grant of the permission.
The High Court held that a material consideration has to serve a planning purpose, be related to land use and be fairly and reasonably related to the proposed development.
In this case, the applicant had expressed an intention in its planning application to make an annual community donation based on 4 per cent turnover which would be spent on any projects, activities and initiatives for the benefit of the community as determined by a panel of members of the community. It was clear that the LPA had treated this offer as a material consideration when determining the planning application and imposed a condition on the planning permission that the benefit would be delivered via a Community Benefit Society.
In assessing whether the donation met the ‘material consideration’ test, the judge noted that the contribution was a purely financial contribution and so did not in any way regulate how the development might operate and was an off-site contribution but not an off-site contribution designed to ameliorate or address some impact on social or physical infrastructure or a contribution designed to address some adverse land use consequent on the grant of planning permission. While an off-site contribution can be a material consideration, the judge noted that it is essential for the off-site benefits to have a real and not a remote or fanciful connection with the development. In this case, the judge noted that “the community donation is an untargeted contribution of off-site community benefits which is not designed to address a planning purpose.”
The fact that the National Planning Policy Framework refers to supporting ‘local strategies to improve health, social and cultural wellbeing for all’ and to delivering ‘sufficient community and cultural facilities and services to meet local needs’ was insufficient. The judge noted that “policy cannot make a consideration material if as a matter of law it is not. The consideration must pass the legal tests set out above before it can legitimately be taken into account by the decision-maker. When the policy refers therefore, for instance, to taking account of local strategies to improve health, social and cultural well-being it intends that that should be done in the context of the lawful regulation of land use. It does not mean that any matter or proposal touching on issues of health and social and cultural well-being will inevitably be a material consideration in development control or forward planning.”
The lesson from this case is to take care when setting out proposals to make community donations as part of an application for planning permission. If these are taken into account by LPA when granting permission and fail to meet the tests as set out in the case, then any decision made by the LPA risks being subject to a claim for judicial review.
R. (on the application of Wright) v Forest of Dean DC  EWHC 1349 (Admin)
Planning Permission - Local Planning Authority grants permission for first legal fracking scheme since 2011
On May 23, 2016, North Yorkshire County Council’s planning committee voted to approve developer Third Energy’s application to frack for shale gas on a site currently used for conventional gas drilling following a two day sitting.
Permission was sought to hydraulically stimulate and test the various geological formations that were identified during an earlier drilling operation, then produce gas from one or more of these formations into the existing production facilities and then restore the wellsite at a site in Kirby Misperton.
The Planning Officer recommended approval of the application despite 4,000 representations being made in opposition. The Planning Officer considered that the impacts of the proposal could be mitigated and controlled by the imposition of suitable planning conditions.
In a statement issued following the grant of planning permission, the Local Planning Authority (‘LPA’) stated that “the planning committee was satisfied that in this particular application mitigation of the effects of the development with regard to safeguarding the natural environment, protected species and habitats, the amenity of local residents, the protection of ground and surface water quality and traffic management can be achieved through the discharge of the planning conditions.”
The LPA’s decision to issue a statement is reflective of the sensitivity of the application which resulted in over 100 speakers making representations to the planning committee. The statement reads almost apologetically in parts as the LPA explains that “local councils are required to work within the national policy framework that indigenous oil and gas remain key to energy security while facilitating the reduction of greenhouse gas emissions. This must be a material consideration, as is the need for economic growth and development that will provide jobs and sustainable communities. Nevertheless, North Yorkshire did not choose to be the first authority to make a decision on fracking within this policy framework.”
The conditions attached to the planning permission cover limiting the duration of the planning permission until 2026, restricting the fracking to certain timescales, limiting noise emissions and requiring production of a noise management and monitoring programme, requiring production of an air quality monitoring plan and various ecological protection plans and detailed requirements for the restoration and aftercare of the site.
Campaign groups Friends of the Earth and Frack Free Ryedale have since applied to the High Court for a judicial review of the decision.
No fracking has taken place in the UK since 2011 when developer Cuadrilla suspended test fracking operations in Lancashire as a result of earthquakes in the area. Since then, two high profile applications to frack by Cuadrilla were rejected by Lancashire County Council on grounds of noise and traffic impacts. The refusals have since been the subject of co-joined appeals and called in for determination by the Secretary of State. The Planning Inspector has now reported to the Secretary of State for Communities and Local Government with a decision expected in October.
The grant of planning permission by North Yorkshire County Council in the face of considerable opposition is encouraging for fracking operators. Although the Government lifted its fracking moratorium in December 2012, no fracking has taken place since. The decision of the Secretary of State in the Cuadrilla appeals will also be particularly interesting in light of the Government’s eagerness to support the development of a vibrant shale gas industry in the UK. The Government states that “the government believes that shale gas has the potential to provide the UK with greater energy security, growth and jobs. We are encouraging safe and environmentally sound exploration to determine this potential.”
Planning application - NY/2015/0233/ENV - Online planning register, North Yorkshire County Council