6 Conclusion
106. The suite of six National Policy Statements
on energy provides an important new tier in the planning process
at a time when the need for investment in new nationally significant
infrastructure projects is acute. We welcome the improvements
made in the revised draft NPSs, where the Government has accepted
our predecessor Committee's recommendations. It has, however,
rejected a number of important recommendations regarding need,
spatial planning and decarbonisation. The changes introduced in
the Localism Bill have raised several new issues, which we have
considered in this report.
107. The energy NPSs are intended to contribute
toward energy security and climate change mitigation by expediting
significant investments in new energy infrastructure. However,
we believe that they do not place enough emphasis on the decarbonisation
agenda.
108. The need case for new infrastructure has been
improved in the revised draft NPSs. However, it is important that
individual applications for planning consent should be assessed
on the basis of need relative to the amount of capacity already
consented. Failure to do this would risk encouraging a second
"dash for gas", as developers hurry to take advantage
of low-cost, high-speed opportunities. While we see a continuing
role for abated gas in baseload, as well as peak-time use of unabated
gas capacity, the development of too much gas capacity could crowd
out opportunities for renewables to form a substantial component
of the energy mix. This could cause the UK to miss its greenhouse
gas emissions reduction targets. The Government recognised this
risk in its response to our predecessors' Report. The overarching
NPS must make it clear that decisions will be made in the light
of consents already granted for other capacity.
109. While we accept that a prescriptive approach
to the location of new projects could undermine the Government's
market-based approach and introduce new costs, we conclude that
more strategic coordination for new energy infrastructure is
necessary, given the massive scale of investment required. This
could take place through the new National Planning Framework.
110. We recommend that the timing of the NPSs
and other significant planning policy developments should be coordinated.
In particular, the NPSs must be in harmony with the changes introduced
in the National Planning Framework and in the Electricity Market
Reform process. Ill-timing could create uncertainty rather than
certainty for new energy infrastructure investment. To this end
delaying ratification of the NPSs for a few months would allow
them to be coordinated with the other significant planning reforms
underway Furthermore, the ratification procedure needs to ensure
that consent for the NPSs is real and detailed, not just a symbolic
vote on a take it or leave it basis.
111. Other changes introduced in the Localism Bill
also pose potential difficulties. We consider that the abolition
of the IPC, the creation of MIPU and the transfer of authority
for decision-making on applications for planning consent improves
the democratic accountability of the process but raises new questions
about the impartiality of decision-making by Ministers. Under
new arrangements, the Minister will be able to decide against
the advice of the MIPC or the IPC. We recommend that the Government
publishes criteria against which the Secretary of State may choose
to exercise his or her discretion and the reasons for going against
the advice of the IPC or MIPU in individual cases. This matters
not just for this Parliament but for decades and even centuries
to come, as there are very long-term consequences of decisions
on energy policy taken now. It is vital that this issue is addressed
or much of the anticipated gain of the NPS system may be squandered
by the reintroduction of political uncertainty in a field where
investment planning horizons are twenty or more years ahead.
112. A lot of work needs to be done in order to meet
the Government's investment objectives and their greenhouse gas
emissions reduction and energy security goals. The evidence presented
to us suggests that, at the moment, the level of investment required
will be difficult to achieve. The National Policy Statements will
form an important component of this project, but their contribution
will be compromised unless the important changes outlined in this
Report are made. Other challenges remain, including the improvement
of skills and institutional capacity in the energy sector. We
will return to many of these issues in our Electricity Market
Reform inquiry, announced on 23 November 2010 and we will monitor
these developments carefully alongside the other changes in the
planning policy process.
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