Energy Bill

Written evidence submitted by the Independent Renewable Energy Generators Group ( IREGG) (EB 16)

Submission to House of Commons Public Bill Committee on the Energy Bill [HL] 2015-16

The Independent Renewable Energy Generators Group (IREGG)

IREGG is a partnership of seven leading independent UK energy generators including Airvolution , Banks Group, Element Power, Fred.Olsen , Infinergy , Infinis and RES that have collectively invested hundreds of millions of pounds in onshore wind generation.

All of this investment has been made to support the Government’s power decarbonisation obligation and, based upon the commitments made previously by Ministers, under the legitimate expectation that they will qualify under the RO mechanism.

75% of the IREGG members’ pipeline is in Scotland. This reflects the location of the sites with the best wind speeds for energy generation, and recognition of the preferences of local communities.

Fair grace periods: Energy Bill and early closure of the Renewable Obligation.

This document outlines the necessary conditions needed to ensure the grace periods clearly and fairly ensure projects with local and democratic consent are delivered, that independent generators are not unfairly disadvantaged and that those who invested in good faith are not unfairly pe nalised .

Ensuring fairness p rojects that received democratic local consent before 18 June but S106 / S75 agreement and formal notice after

· The Conservative Party Manifesto made a commitment to give "local people have the final say on windfarm applications". It is widely considered that a decision made by a democratically-elected local planning committee embodies the principle of giving local people the final say.

· The Government’s proposed grace periods for the early closure of the RO currently exclude projects which received democratic local planning consent before 18 June 2015 in a planning committee resolution, but did not complete a Section 106 (in England and Wales) or Section 75 (in Scotland) agreement and receive the formal written decision notice until after the cut-off date. This distinction prevents local people having the final say on windfarm applications.

· The publication of a written decision notice is considered by developers and local authorities to be a procedural step. IREGG is not aware of any commercial project that received local community consent at planning committee and was not awarded the written decision notice because of failure to complete a S106 / S75 agreement .

· Given that developers have been working on the basis that planning consent has been democratically approved, projects at this stage have greater sunk costs, as although a decision notice has not been formally issued it is expected as a real and substantial commitment has been .


Grace period conditions should allow for the delays in the issuance of the decision notices resulting from the time taken to produce them to enable locally approved windfarms to be
built out .

The Government’s view on legal consent and "minded to approve"

· The Government has been advised, as indicated in Minister of State for Energy and Climate Change Andrea Leadsom MP’s letter to the Chair of the Energy and Climate Change Select Committee on 23 November 2015, that:

"Another scenario that was considered is applications which went to planning committee for consideration of their planning application. The planning committee could have been "minded to approve" on or before 18 June, subject to a S106/S75 agreement, but no formal consent was granted on or before 18 June. Unfortunately, there is no legal consent given with "minded to approve". We understand that negotiations for S106/S75 can be lengthy, and are not always successful. So this can represent a significant hurdle that needs to be cleared before granting of planning permission. There is an indication that consent is likely to be granted provided such an agreement is reached. It does not seem to us equivalent to the grant of consent in terms of the extent to which a developer can rely on it to proceed with their development."

· The Minister states that there is "no legal consent given with "minded to approve"". However, in that same letter when referring to the grace period that allows projects to go through on appeal it is stated that this is because "we believe that the grant of planning permission on appeal will have established a legal right to planning permission on or before 18 June. The legal advice IREGG has received is that if this is the approach that the Government is taking with appeal projects, then this "legal right" should apply equally or with an even greater effect to permissions resolved at a local level but issued after the 18 June cut-off date.

· A development which has been refused permission at a local level and which goes to appeal is more likely than not to be rejected on appeal, particularly in the light of the advice in the Written Ministerial Statement of 18 June 2015 issued by the Secretary of State for the Department for Communities and Local Government Greg Clark MP, which attributes great, even conclusive, importance to community support for onshore wind developments.  If there is a resolution for approval at a local level then this surely demonstrates community support far more than a refusal at a local level which could not, on the face of it have such support. In terms of a legal entitlement to a permission, this must be an important factor.

· For these reasons, the legal advice IREGG has received categorically states that there is as much "legal right" to a planning permission resolved at a local level as there is to a permission granted on appeal following a refusal by the planning committee representing the community.

The Government’s view on S106/S75 and their success rate

· IREGG has consulted with other developers, planning lawyers, planning advisers and Local Planning Authorities to assess whether there are any examples in which consent was withheld because a S106/S75 agreement was not issued.

· Following an extensive scrutiny of the eight largest independent UK developers’ experience across hundreds of development projects, IREGG has been unable to identify a single instance of a commercial project which has failed because it failed to agree a S106/S75 agreement. Please see statements below attesting to this from those with whom IREGG consulted:

"I have never come across a case where an application has been resolved for approval subject to conditions and a S75 /106 Agreement and then refused. I have known cases where S75 /106 demands have been rejected by an applicant who has gone to appeal on the point or where excessive delays have led to a non-determination appeal, but those are different cases. Thus a resolution to approve can be viewed as a real and substantial commitment, if not a legal one."

Marcus Trinick QC, Partner, Eversheds

26 October 2015

"We cannot recollect any instance where we have seen an inability to agree upon the terms of a planning obligation preventing the grant of planning permission following a resolution to grant by Committee."

Patrick Robinson, Partner, Burges Salmon LLP

4 November 2015

"I have not had any cases where planning permission for a wind energy scheme has been refused by a local planning authority because of a lack of a S106 agreement."

Richard J. Glover, Partner, Squire Patton Boggs (UK) LLP

5 November 2015

"Like Richard we have not had any cases where planning permission for a wind energy scheme has been refused by a local planning authority because of a failure to conclude a planning agreement."

Jennifer Ballantyne, Partner, Pinsent Masons LLP

5 November 2015

· Additionally, Element Power asked Dumfries and Galloway Local Planning Authority of its experience with S75 planning agreements. It confirmed that it is not aware of any commercial wind farm which did not proceed because it was unable to complete a S75 planning agreement.

· As per the evidence above, overhanging S106/S75 agreements are not considered to be a factor that would cause planning consent to not be given. Projects with local democratic consent in advance of June 18 th are those that have embraced the spirit of the Conservative Party manifesto commitment to give " local people have the final say on windfarm applications" . They are arguably the most important to protect as part of a commitment to fairness for sunk costs invested in good faith.

January 2016

 

Prepared 27th January 2016