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Revised Draft Overarching National Policy Statement for Energy (EN-1)

I am very pleased to open this debate on the revised draft energy national policy statements—the NPSs. The NPSs are a suite of documents that will comprise the decision-making framework for major energy infrastructure proposals. I will briefly explain the changes that we have made to them since the first consultation in November 2009. First, I should explain briefly the role of Parliament in ensuring that the revised documents are as robust as possible. This debate is part of the scrutiny process set out in the Planning Act 2008. It is an opportunity to comment on the revised energy national policy statements, apart from the nuclear one, which we will debate on Thursday. The coalition Government believe that NPSs should be subject to approval by Parliament so that they have the strongest possible democratic legitimacy. This House has an important role in scrutinising draft NPSs, and this debate will help the Government prepare the final versions of NPSs. I hope your Lordships agree that we have taken on board the very helpful comments by noble Lords in shaping these NPSs. We intend to lay the final NPS for ratification in the spring. The revised versions of the five non-nuclear NPSs take into account the previous Grand Committee debates and the recommendations from the Energy and Climate Change Select Committee. Details of these are set out in the response to parliamentary scrutiny. I have also placed a memorandum on the changes to the NPSs in the Library. Throughout the NPSs we have tried to improve the clarity and consistency and we have removed repetitive material from the technology-specific NPSs where it could be said once in the overarching NPS. We have made significant changes to the statement of need in the overarching NPS, EN-1. This now includes research that was not available for the first draft, including more detailed analysis of scenarios to achieve an 80 per cent reduction in carbon emissions by 2050. However, the conclusions remain the same: we urgently need a new energy infrastructure. In fact, the Pathways 2050 model shows that we might need at least twice the electricity-generation capacity by comparison with today in order to meet our climate change targets because we will need to electrify large amounts of industry, heating and transport. Our modelling shows we need about 59 gigawatts of new electricity capacity by 2025, of which more than half will come from renewables. We would like a significant proportion of the remaining non-renewable generation to be filled by either low-carbon technologies, such as nuclear or coal with CCS. New nuclear should be free to contribute as much as possible to this. We also need gas generation as part of our transition to low-carbon. We have also included more detail in EN-1 on what is required for an economic feasibility assessment to ensure that fossil fuel generation stations are carbon-capture ready. In this Committee last February, the noble Lord, Lord Woolmer, suggested that the provisions in the fossil fuel generation stations NPS—EN-2—which require applicants to demonstrate the economic feasibility of carbon-capture readiness, were such that developers would have difficulty demonstrating economic feasibility. We have therefore added more detail in EN-2 on how applicants might demonstrate that their proposals for CCR would be economically feasible, including a model for an economic assessment that takes into account the difficulties of calculating variable costs over a long period. The revised overarching and fossil fuel NPSs also note that operators of fossil fuel generating stations will have to comply with an emissions performance standard. That may be introduced but it is not currently envisaged that it would be a development consent condition. We have clarified that the renewables NPS—EN-3—does not cover alternative renewable energy technology, such as tidal and wave power or solar energy. We do not anticipate that most of these technologies will become commercially viable above the Planning Act 2008 thresholds in the near future. However, applications for consent for tidal range schemes may be submitted to the IPC or its successor in the next few years. We are therefore considering including tidal range schemes in the NPSs, either through an amendment to this NPS or through a separate NPS at an appropriate stage. I thank the noble Baroness, Lady Young, for her suggestion in the previous debate that the renewables NPSs should set out specific directions to the IPC on assessing the sustainability of biomass for generating stations using it as fuel. We have considered this carefully. However, we believe that sustainability of biomass is best addressed through the renewables obligations. The revision of the renewables NPS explains that, subject to the necessary changes being made to the RO, there is no need for the IPC to consider this matter further. We have consulted on the necessary changes in the Renewables Obligations Order 2011. We are also consulting on further proposals in the EMR consultation that closes in March. We have also revised the text with regard to noise for onshore wind farms. The ETSU-R-97 recommendations for noise limits for the operation of wind turbines have been criticised as being outdated. We have therefore made it clear that applicants should take into account the latest industry good practice on assessing noise from wind turbines, as well as existing guidance in ETSU-R-97. We are keen to ensure that planning authorities and developers have clarity about best practice to provide greater certainty and consistency in the planning system. Therefore, we have also commissioned research to analyse consideration of noise in development consents. This is due to be completed in March and will inform the text in the renewables NPS. We have clarified that the gas supply infrastructure and gas and oil pipelines NPS—EN-4—covers only oil and natural gas pipelines, and not CO2 pipelines. We will seek views on the development of the CO2 infrastructure and intend to include onshore CO2 pipelines in a suite of NPSs at a later date. The noble Lord, Lord Crickhowell, suggests that NPSs should address safety in LNG deliveries to terminals. The Government agree, and the NPS has been amended to include an explanation of the regulatory controls that apply to ensure safe shipping of liquefied natural gas. In the February debates the noble Lord, Lord Judd, was concerned about the impact of overhead electricity lines—I agree entirely with his concern, as a private matter—in areas of outstanding natural beauty. We have tried to ensure that the government policy on undergrounding and the need to treat each application on a case-by-case basis is expressed more clearly in the electricity NPS, EN-5. We have also added a new section on bird strike in this NPS to reflect findings in the revised appraisal of sustainability. We have also substantially revised the appraisal of sustainability for the non-nuclear NPSs. This will make it easier for people to evaluate the likely environmental impacts of the revised draft national policy statement. We also set out strategic alternative approaches to the NPS policies and explained why at this stage we do not think that they represent better ways of achieving our energy policy objectives through the planning system. The Localism Bill, which had its First Reading in the other place on 13 December, sets out our proposals to abolish the Infrastructure Planning Commission and replace it with a major infrastructure planning unit as part of the Planning Inspectorate. Under the reform regime, major infrastructure projects will be decided by Ministers in accordance with the policy framework, not by a quango, so there is an urgent need for the new major energy infrastructure. The energy national policy statements in place will provide a clear framework against which planning applications for this infrastructure will be assessed. I commend these national policy statements to the Committee.