Energy Bill

Written evidence submitted by Velocita Energy/2020 Renewables Ltd. (EB 23)

BACKGROUND

We make this submission to the Energy Committee to present a counter-argument to the Government’s plans to close the Renewable Obligation for onshore wind in March 2016 as opposed to March 2017.

ABOUT VELOCITA/2020 RENEWABLES

2020 Renewables was established in 2010 and specialises in developing, constructing and operating onshore wind projects throughout the United Kingdom. The team has extensive working knowledge of the renewable energy industry dating back to 1990.

To date the team has developed a portfolio of projects with a total capacity of over 530MW of onshore wind projects, principally in Scotland.

2020 Renewables merged with Velocita Energy Developments (Velocita) in July 2012. Velocita was established in early 2011 in partnership with Riverstone Holdings to finance the development, construction, ownership and operation of utility-scale wind energy projects in several countries across Europe.

SUMMARY OF MAIN POINTS

· The trigger date of 18 June 2015 for grace period protection should be extended to any project that has a reasonable expectation of being granted planning permission, rather than only those for which consent has already been granted by that date.

· The concept of "Planning agreement" needs to be clearly defined, covering agreements under all planning authorities.

· There is no apparent justification for treating Section 42 variation differently to variations of Section 36 planning consents, as s42 planning permissions only amend the conditions to the planning permission and cannot extend the scope of the planning permission. The problem can be addressed by inserting a provision which provides that, if there is a planning permission in place on 18 June, and subsequently a further planning permission is granted under s42, then the implementation of the later permission will not prevent the windfarm from being eligible for protection.

· The grid connection application is not a reliable indicator of the extent of work or progress on a project. The making of an application by 18 June would be a fairer trigger for eligibility.

1. Legitimate Expectation of Grant of Consent on or before 18 June 2015

Proposed wording

Option 1: Evidence that an application for planning permission for the station or additional capacity was made on or before 18 June 2014, and that the planning permission for the station or additional capacity was granted after that date.

Option 2: Evidence that an environmental statement relating an application for planning permission for the station or additional capacity was submitted on or before 18 December 2014, and that the planning permission for the station or additional capacity was granted after that date.

1.1 The principle of grace period protection is to protect developers who had invested considerable time and money on developments on the basis of the policy in place before 18 June. Therefore, we think that this should be extended to any development that had a legitimate expectation of being granted consent prior to 18 June 2015. The use of the grant of planning consent as the trigger for eligibility will lead to unfair outcomes given that planning authorities take different lengths of time to make determinations of planning consent and that many projects have been in the planning system for some time before 18 June.

2. Provisional Decision made on or before 18 June 2015

Proposed wording

Evidence that the relevant planning authority has made a decision to grant planning permission for the station or additional capacity, or has made a decision to grant planning permission for the station or additional capacity subject only to the execution of a planning agreement, on or before 18 June 2015, and that the planning permission for the station or additional capacity was granted after that date.

2.1 This amendment is intended to address cases where the decision has been made, but due to procedural delay permission has not been legally granted. Again, it is known that different authorities have different practices in this area – some, for example, will require a s.75 or equivalent agreement where others will only impose a condition.

2.2 For the purposes of this subsection, "planning agreement" would need to be defined covering, for example, agreements entered into under s.75 of the Town and Country Planning (Scotland) Act 1997, or under s.106 of the Town and Country Planning Act 1990.

3. Variations to Planning Permissions

Proposed wording

For the purposes of subsection 32LJ(4) – if one or more conditions attached to a planning permission for a station or additional capacity which satisfies the Approved Development Condition are amended after 18 June 2015 by way of a planning permission under section 42 of the Town and Country Planning (Scotland) Act 1997, the implementation of that section 42 planning permission will be deemed to be an implementation of the original planning permission for the station or additional capacity.

3.1 The drafting of the legislation originally proposed by the Government would result in an unintended outcome. If a developer obtains a section 36 consent for a windfarm before 18 June and then varies it by a section 36C consent, the windfarm will be eligible for grace period protection. A section 36C consent varies the original section 36 consent. This means that the developer is implementing the original consent as varied and therefore, based on the drafting of the legislation originally proposed by the Government, the windfarm would be eligible for protection.

3.2 If, however, a developer obtains a Town & Country Planning Act planning permission and then varies it by a Section 42 application, the section 42 variation is deemed by legislation to be the grant of a new planning permission. This means that the developer is implementing the section 42 planning permission not the original planning permission, and the windfarm will not be eligible for protection. There appears to be no reason to treat the two situations differently.

3.3 Section 42 planning permissions only amend the conditions to the planning permission and cannot extend the scope of the planning permission so there is no risk of new wider planning permissions becoming eligible. The problem can be addressed by inserting a provision into the Energy Bill which provides that, if there is a planning permission in place on 18 June, and subsequently a further planning permission is granted under s42, then the implementation of the later permission will not prevent the windfarm from being eligible for protection.

4. Grid connection condition

Proposed wording

Evidence that an application for a grid connection for the station or additional capacity was made on or before 18 June 2015 and that an offer of a grid connection has been made after that date

4.1 The grid application is often left until later in the development process because grid connection costs are incurred as soon as the offer is accepted. As a result, it is not a reliable indicator of the extent of work or progress on a project. We think it would be more appropriate to use the making of an application, rather than the making of an offer, by 18 June as the fairest trigger for eligibility. We suggest that the requirement to demonstrate a valid grid connection at 18 June is deleted.


January 2016

 

Prepared 2nd February 2016