Overarching National Policy Statement for Energy
Lord Wilson of Sedgefield
That the Grand Committee takes note of the initial proposed Overarching National Policy Statement for Energy.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, I shall speak to all three Motions in my name on the Order Paper at the same time. I am pleased to open the debate. The energy national policy statements set out the Government’s policy for the delivery of energy infrastructure and provide the legal framework for planning decisions on nationally significant infrastructure projects. In 2024, the Chancellor announced a review of the current suite of NPSs to provide clarity for industry and stake- holders on the Government’s clean energy superpower mission.
This Government have been clear that the answers to the challenges around energy security, affordability and sustainability point in the same direction: to clean energy. For this reason, we have reviewed all the NPSs and determined that the existing overarching NPS for energy, EN-1, the NPS for renewable electricity, EN-3, and the NPS for electricity networks, EN-5, should be amended to reflect the policies set out in the Clean Power 2030 Action Plan. This was published in December 2024 and supports the investment required to build the infrastructure needed to accelerate to net zero.
The suite of energy NPSs—EN-1 to EN-5—were updated recently and published in January 2024. Most changes made to the NPSs in 2025 are therefore minor changes to enhance the clarity of the guidance. Some material updates have been made which pertain to policy, and I will outline them for debate.
EN-1 sets out the overarching need case and general assessment principles. The narrative of EN-1 has been updated to reflect the publication of the Clean Power 2030 Action Plan. This reflects that all low-carbon NSIPs benefit from critical national priority status, with a presumption in favour of consent. This will include those relevant for clean power 2030. Energy from waste projects will no longer benefit from the critical national priority policy, as they do not meet the definition of a clean power technology in the Clean Power 2030 Action Plan.
The Government recently made legislation to reintroduce onshore wind into the nationally significant infrastructure projects regime. This provides an appropriate route for nationally significant projects over 100 megawatts in England to seek planning consent. These projects are of a scale and complexity that local impacts need to be carefully balanced against the national benefits and meeting the UK’s wider decarbonisation goals. To support the assessment and determination of onshore wind projects entering the nationally significant infrastructure project regime, the Government have included a new section within EN-3, addressing the impacts, considerations and other matters specific to onshore wind.
This Government are committed to removing barriers to the deployment of offshore wind and acknowledge the importance of this industry to our clean power 2030 goals. One issue that has recently arisen is inter-array wake effects. This is why, at the design stage for a proposed offshore wind farm, we propose in EN-3 that an assessment of inter-array wake effects is recommended to take place between applicants and those of consented and operational wind farms to inform and support the consideration of potential mitigations.
For EN-5, new references to the centralised strategic network plan—CSNP—will provide a holistic plan across the whole transmission network, onshore and offshore. This will enable co-ordinated, efficient network development and ensure access to reliable, clean and affordable electricity. The CSNP will provide an independent, long-term plan out to 2050 on how the transmission network should develop to meet our energy security and decarbonisation goals. Endorsement through the NPS would mean that the need case and technology type for projects that adhere to the recommendations of the CSNP do not have to be examined in the consenting process. The CSNP would establish the need case and technological solution. Removing this from the consenting process could accelerate the pre-consenting stage and reduce project-level risk.
In anticipation of a public consultation and publication of the electricity transmission design principles—ETDP—by the National Energy System Operator, we propose amending EN-5 to reference the ETDP, setting out that developers should have regard to it, as relevant, in addition to the Holford and Horlock rules. This will apply only once the final version of the ETDP is published early in 2026 and will apply only to projects at the strategic front end stage of the design process or earlier.
The three draft NPSs were laid in Parliament and published for public consultation, alongside the appraisal of sustainability and habitats regulations assessment. The consultation closed on 29 May and nearly 200 responses were received. The Government are considering these and will issue a formal response and revise the draft energy NPSs as necessary. The Energy Security and Net Zero Select Committee has also scrutinised the draft NPSs and published its report on these on Monday 7 July. The Government will similarly consider and respond to the committee’s conclusions, and revise the NPSs as appropriate.
The Government aim to lay the NPSs in their final form for a 21 sitting day consideration period later this year. I appreciate that there are likely to be many views on these changes, and I look forward to hearing all the contributions to today’s debate. I beg to move.
Lord Grantchester (Lab)
I thank my noble friend the Minister for his introduction to the energy policy statements before the Committee. They are necessary and important. Energy security and lower bills for consumers can best be delivered by delivering clean power by 2030 on the pathway to net zero. This is a vital growth opportunity that will benefit communities across the country through good energy projects creating modern jobs and resilient connectivity. The fast-growing renewables sector will underpin manufacturing and supply chains. I look forward to the development of plans and announcements from Great British Energy, as well as the National Wealth Fund, to drive low-carbon investment.
Specifically, these policy statements bring forward Labour’s drive in the Clean Power 2030 Action Plan for clean power sources to produce at least 95% of the UK’s power generation by 2030. Is my noble friend the Minister in a position to give any indication of the responses to the consultation that closed at the end of May, which he mentioned?
I welcome the establishment of the presumption in favour of consent under draft EN-1 through the remit of critical national priority—CNP. This should speed up the planning process and strategically assess the pipeline of deployment of offshore wind, onshore wind and solar, with nuclear as a backbone and low-carbon hydrogen likely to play an increasingly significant role. Importantly, energy from waste is now excluded from CNP as it no longer meets the definition of clean power. It is important that EN-1 underscores the need for flexibility and resilience to deal with unexpected events and challenges from continuing climate change.
EN-3 is very important as it reintroduces onshore wind into the nationally strategic infrastructure projects regime at the threshold of more than 100 megawatts, although Wales will keep its own dedicated consent decision-making process. Could my noble friend the Minister give some reasoning behind why this level of threshold was decided on and its implications? Can he assure the Committee that the community obligations and benefits will be commensurate with the size and impact on communities? The guidance under EN-3 is only applicable in England. I am aware of a plethora of development applications, especially in Dumfries and Galloway in Scotland, where naturally high-lying exposed sites present multiple challenges not only to residents but environmentally and ecologically to catchment areas.
The challenge of upgrading the grid is contained in EN-5 and is arguably the more critical, with the need to integrate electrical power to all parts of the country, urban and rural, for development and growth. EN-5 introduces centralised strategic network plans, as my noble friend indicated, and the process to identify future infrastructure needs up to 2050. Here again, looking strategically across the network and project endorsements within CSNP, this should bring benefits of reduced risk and shorter planning timelines to development consent orders. This replaces the date order of applications for projects that led to long delays for connections.
As the nation powers up electricity to all new areas, down transition systems into the threads of distribution systems to local development projects, flexibility and future-proofing with spare capacity will be at a premium. Although the establishment of NESO has significantly improved the co-ordination of whole-system planning, delivery remains fragmented. Grid infrastructure is still likely to be developed reactively based on project applications rather than long-term system needs. Is my noble friend the Minister assured that centralised strategic network plans co-ordinate with regional development and local needs that endorse clusters which can be built around various local sector developments? They risk being constrained without future-proofing.
Although I welcome the establishment of the National Infrastructure and Service Transformation Authority—NISTA—it is based in the Treasury. How will NISTA co-ordinate with NESO in the department, and the department with regional mayors and development plans, to avoid conflicting priorities and delivery through a lack of clear responsibility? What will be the Government’s arrangements and what will they look like? Is it recognised that NESO could be improved with a statutory duty mandate with investment authority based on power needs in line with its strategic mandate? The build ahead model must be embedded in law to give clear obligations to delivery bodies and regulators to plan infrastructure on forecasted clean energy demand, rather than on the sum and mix of existing applications. Would my noble friend the Minister agree that this could provide the impetus to attract investment to build the infrastructure clearly identified in the clean power plan?
The greatest fear is that investment could slip back into the Conservative-type switching on and off of government resources in the Treasury that has so bedevilled infrastructure development in the past, either with or without national industrial strategies. Can my noble friend confirm that the sensible multiyear detailed capital spending plans for each department will be maintained, providing certainty and confidence to businesses and investors? Can he give any indication of the outcome of the Green Book review to endorse proper co-ordination between departments and mayoral plans for their areas? I know that this is critical to areas such as mine on Merseyside, where the Mersey barrage has such great potential.
In more rural areas, and perhaps below the NPS threshold, transmission capacity has already been improving. Although district network operators—DNOs—were not designed for decentralised applications, there have been notable improvements in access, but there is still a backlog of projects. Although queue reforms are beginning to unlock developments, there still remain many zombie projects to be cleaned out of the process. The problem of grid balancing for renewables remains to be solved. Can my noble friend the Minister give an update on battery storage development and funding, which is so vital to flexibility in connectivity efficiency?
Finally, it is rewarding to see biodiversity protection and delivery, as well as climate change resilience and adaptation, enshrined in these policy documents at last. It is admirable that this is being adhered to in these statements and the Government’s array of strategy documents. However, there remains one that is vital to co-ordinate across departments: the land use framework. This should integrate with a joined-up approach and give co-ordination across all the demands for land required for infrastructure, as well as housing, transport and everything else needed to transform Britain. Can my noble friend the Minister make sure that this is neither too late nor the last aspect to be considered, as it should match ambition with delivery?
Lord Howell of Guildford (Con)
My Lords, I declare my interests as set out in the register, as an adviser to the Kuwait Investment Office and, on the unremunerated side, as chairman of the Windsor Energy Group and several other similar groups.
I note with slight regret the departure of the noble Lord, Lord Hunt of Kings Heath, with whom we have had some exhilarating debates. That is rather sad for me; I think we were getting on pretty well, although he spent an entire column of Hansard ticking me off for allegedly being against Sizewell C, when he claimed that everyone else was in favour. I understand why he said that, but it is not quite true. I am, in fact, strongly in favour of further development of Sizewell C; I had something to do with the final kick-off for Sizewell B, which took 15 years to build. I am sure there is a good site at Sizewell C. What I am against is dumping on it another white elephant EPR of the design being painfully worked out at Hinkley, which has not worked in many other places, is vastly expensive, will probably take another 15 years to build, and will cost huge amounts of government money at a time when we do not have much.
It is perfectly clear that if the alternative, which I shall come to, involving a set of smaller products built by Rolls-Royce, GE Hitachi or anybody else, were placed on that prepared site of Sizewell C it would have enormous attraction for private investment. Several private investors—small modular reactor builders—have already indicated that it could be done in a quarter of the time and would involve far less uproar over planning and construction sites, because these things are fabricated mainly in factories. It would also greatly ease the huge pressures building up on the state, on the Government, on the consumer—who is already very hard pressed and paying some of the highest electricity prices in the world—and on the taxpayer. I cannot imagine or understand why it has been decided to use this site for a replica of Hinkley C.
The Secretary of State says, “Oh, it’s fine, we’re the driving force in promoting nuclear; it’s a very good thing”, and mentions a list of things including Hinkley and Sizewell C. All I can say on Hinkley is that we were supposed to cook turkeys with Hinkley electricity in 2017, so we are eight or nine years behind time. Originally, way back when it was first mooted under a Labour Government in 2007, believe it or not, it was supposed to cost £9 billion. The Tories continued to approve it through their period and the price gradually rose from £9 billion, to £17 billion, to £23 billion, to £30 billion and then to £33 billion—admittedly with inflation obviously operating on it. Now the figure is £46 billion, although I have heard a figure of £51 billion mentioned. The prices are out of control.
Is this a system that we want to replicate? Do we really believe that we will learn all the lessons of Hinkley C and other EPRs around the world that have not been at all successful and are of a design that even the French recognise as “unbuildable”, as the chief executive of EDF has said? Is that really the best use of this site? I think not. Having spent vast sums—£2.7 billion—preparing the site, we should think again about whether we want either to see carbon-free electricity flowing from that site in the next 10 years or to resign ourselves to the fact that it is very doubtful that it will be in time for the 2050 net-zero targets.
We will come back to that, but here we have this rather complicated suite of documents. We are debating EN-2, EN-3 and EN-5 today—and, of course, a revised system in EN-1; I see the logic of why we need to revise the base of the system each time we move forward into new areas. We have already discussed EN-7 in this Room, which was very useful in opening up, more widely than hitherto, the nuclear side and recognising more strongly the case for SMRs, AMRs and other new technology in nuclear power. All that should be fully applied in the next stage in nuclear development, including a very large number of SMRs. We need to move quickly because the order books of the world are filling up as many other nations move into the area of SMRs. The latest, I saw this morning, is Indonesia, which is ordering 20 new SMRs, which it believes will be in operation in 2028.
Nevertheless, here are all these documents. I will try to concentrate on EN-2, EN-3 and EN-5 although, inevitably, our questions spill over to EN-7, the response to EN-7 by the Government, and EN-6, although that is not actually available. The Printed Paper Office tells me that EN-6 has effect for listed nuclear projects capable of being deployed by the end of 2025 and that the Government are in the process of preparing a new NPS. We cannot debate what we have not seen, but that will obviously overlap with many of the things that we have seen in the three documents before us.
I will go through a list of what one welcomes and what one deplores. I welcome the comprehensive approach in every conceivable aspect of the construction, the environment and the impact. A tremendous amount of work has been done by very many minds, and it is very impressive.
I welcome that it is recognised that we need new gas infrastructure. Surely that does not fit into a net-zero world—but yes, it does. We will see in a moment that it is confirmed in these documents. I welcome that the NPSs take a cautious step forward on the whole issue of how on earth we get electricity to the place where it is needed, from the new sources to the new consumer markets, with the very sensitive issue of pylons and how it is carried and transmitted. I shall come to that in a moment.
I welcome the fact that EN-5, I think, openly recognises that only half of the total energy demand for electricity will be met by 2050—and the other half will presumably come from unabated or abated gas and oil. That opens the question of how on earth you handle the emissions from the unabated electricity, which is necessary for our modern electricity demand. The answer takes us into the world of carbon capture and storage, which again is covered and referred to fairly comprehensibly in one of the three documents—I forget which.
I notice the enthusiasm with which the Government, from the Secretary of State downwards, say that we are driving all these nuclear plans forward. I have to say that if he is driving the Hinkley C plan forward, he is a very slow learner driver indeed. As I have already remarked, it was meant to be ready in 2017, or even earlier.
Those are things that are good. Now I come to the rather negative side. Of course, the nuclear replacement programme is miserably slow. We are all waiting for the final decision on Sizewell C. It was rumoured that it was going to be announced while President Macron was here yesterday or today. I do not know whether that has happened—I have not heard anything on the radio or seen anything in the newspapers or on the television, but that was the idea.
We are moving really very slowly in the direction of the final decisions on the real momentum needed for small nuclear reactors, which are sweeping the world not as a diversion or an alternative but as the next stage on from the huge gigawatt plants that are being built at Hinkley and one or two other places in the world, one of which is apparently about to be built at Sizewell. That is yesterday’s scene; those are the technologies of yesterday. We need the technologies of today: hundreds of smaller modular reactors that will be built much more quickly and attract private money.
There is a lot of talk about how somehow private money can be induced into Sizewell, through the regulated asset bases; the more I try to work out why private investment will be attracted, the more complicated it becomes. Perhaps the Minister will tell us what the latest story is about this, since one rumour is that nothing has been raised at all. Other rumours are that there has been some development in attraction from the regulated asset base income stream, paid for by consumers, years before anything is actually completed, let alone before a single kilowatt of electricity is generated and sold.
I deplore, though not quite so strongly, the handling of the hydrogen sector, which is interesting. It is recognised that hydrogen is not a fuel but a vector; it is a means of carrying power from one place to another and of encouraging local distribution. There is no reason why the considerable amount of electricity that, at present, is not generated in the night when not wanted, even when there is a good wind—of course, that costs the consumer a lot of money—should not be used to convert into hydrogen. The hydrogen can then be shipped, just as petrol is now in petrol trucks, to the destination markets where it is used.
That has another implication, which is interesting and not mentioned at all: if hydrogen is being shipped by truck to markets where it could be either fed into trucks or turned back into electricity, you will not need pylons. You will avoid all the agony and debate, which we are going to get stuck into, about where pylons should go, and areas they are going to go over, including
“some rural and coastal parts of the UK”
that
“have not been near sources of electricity generation”.
Those are bureaucratic, polite words for, as we know, some big pylons marching over beautiful areas. That will involve a long planning battle and be expensive, although putting them underground is not much improvement even on that. I am told that, nowadays, it is not just a question of digging a trench; it is necessary to have at least two wires a tennis court’s distance apart, and a far bigger disruption of the landscape—equivalent, temporarily, to building a motorway. None of these documents goes into that reality, which is being widely discussed by many people outside the Department for Energy Security and Net Zero.
I am sad that the whole idea of the Morocco interconnector has been dropped—it was in early White Papers. That is 3.2 gigawatts of clean electricity that we will not have. I am sad that the CCUS projects are moving much too slowly, because how can we get to net zero and abate all the gas and oil that will still be burned without a massive expansion of CCUS? I regret that our contribution to lowering world emissions will thereby be lower than it is going to be anyway. I regret that the technology that we developed for CCUS—which would have a real benefit in high-emissions countries such as India, China and, indeed, the United States—which we could be exporting will not be exported. It is not even mentioned in these in these documents.
I regret that the limits of the Secretary of State’s power in agreeing or disagreeing infrastructure projects are so vague. All we get is guidance that there must be an “appropriate balance”. How nice that the Secretary of State should be guided by an appropriate balance. What is an appropriate balance? Who will decide it? How will it be fair and just between all the different and immense pressures?
I regret that there is a vast underestimate throughout all these documents of the amount of clean electricity demand that will be required. In one of the earlier documents there was talk about doubling electricity demand. When one realises that electricity demand is now about 1/10th of total energy usage, doubling it will get us nowhere. We are talking about 300 gigawatts at the very least. The official figure appears to be under 200 gigawatts.
Finally, I regret that there is an underestimate of the enormous complexities, about which I was warned 40 years ago as Secretary of State, of integrating intermittent electricity into a stable grid system. It requires vast engineering ingenuity of the kind that clearly did not exist the other day in Spain and Portugal, where the lights went out completely. I want our lights and power to stay on. I want our power to be affordable. I do not see any big reassurance, even in all this literature and huge suite of documents, that that will be achieved.
The Lord Bishop of Norwich
My Lords, I am grateful to the Minister for his introduction, as there are many things within these documents to praise. They set out a positive direction for future energy infrastructure, which broadly aligns with clean power by 2030 and net zero by 2050. Although I—and, I am sure, many others—welcome a whole-system approach to energy infrastructure planning, delivery has remained fragmented. Let us hope, to coin a phrase, that the wind might now change.
I have just come from the mass climate lobby outside, in Parliament Square. I am not usually someone who joins such events but, for me, it is vital for us to hear the Climate Coalition and the great many people who are raising this issue of climate change and nature loss, because it seems to be slipping down political agendas. Some of the coalition’s aims are to cut bills, back UK jobs and secure a greener, fairer future for all. Another is to restore nature to create a safer and healthier future. With these aims still fresh in my mind from the crowd outside, my remarks will address three areas: first, the cost of connection and district heating networks, especially for those organisations that create the warp and weft of community life; secondly, the capacity of the grid to receive the quantity of renewable energy that we need produced; and, thirdly, mitigating the impact of infrastructure projects on people, nature and landscapes.
Any approach to electricity network infrastructure must include the entire community that is affected or may be able to be a producer of energy. That includes our businesses, places of worship, community centres, sports clubs, town halls, schools and homes. Frustratingly, though, the cost of upgrading the connection to a low-voltage cable can be a huge barrier. One church in the diocese that I serve—St Margaret’s in Lowestoft—has been quoted £100,000 to upgrade its connection and move away from fossil fuel heating. Another, St Mary’s Church in King’s Lynn, has been given two quotes by Eastern Power Networks: one at £90,000, the other at £130,000.
Our churches and other community assets that need upgrades, particularly in rural areas, are also part of wider communities and villages that also need upgrading. Many of our churches are blessed with large south-facing roofs, which are ideal for generating electricity, as is now happening on the roof of King’s College Chapel in Cambridge and in many other places. If churches could have easier and cheaper ways to connect on to the grid, alongside other community buildings, they could not only move away from fossil fuels but become generators of solar energy and provide this to their local communities.
I was pleased to see local energy generation included in the Great British Energy Act and hope that this can be built upon, but I fear that the costs will not make it possible in many places. Can the Minister say what support His Majesty’s Government might make available, or how they might put pressure on companies providing the connections, so that community organisations that wish to change from oil and gas to renewable electricity, or feed into the grid, are not prohibited from doing so by the exorbitant cost? I was also pleased to see mention of heat networks in EN-1, although I again see cost as being a large barrier to those who wish to join a network. This needs to be tackled.
To come closer to this place, Project SWAN is a London district heating network that aims to provide sustainable heating from renewable energy sources—such as waste heat from the Thames and the London Underground—to Church House Westminster, Westminster Abbey and government offices in Great Smith Street. It seems, however, that the costs for Church House alone have rocketed from initial estimates of £2 million back in February to £3.5 million now, so the project becomes no longer affordable. Meanwhile, other organisations within the catchment area are pulling out. If we wish for district heat networks to play a larger part in our energy infrastructure, how does the Minister suggest a funding package or mechanism could be put in place to enable these to be more affordable for a range of partners?
My second point is about the grid in the east of England not being capable of handling the quantities of electricity we hope can be generated offshore. There is a risk that renewable energy production will stall due to the lack of grid capacity. We have a situation in which grid infrastructure is still being developed reactively, based on project applications rather than a longer-term systems need. I hope the Minister will agree that we need to move to a “build ahead of need” model. Is any consideration being given to embedding legal obligations for delivery bodies and regulators to plan infrastructure based on forecasted clean energy demand? Of course, we also need solar as standard on new-build houses and to use the enormous acreage on warehouses and industrial units to generate more electricity. We are missing a trick by not encouraging as much energy production as can be achieved as near as possible to its use.
In making my third point, I acknowledge the impact that this infrastructure development can have on local communities and nature, particularly during the building phase. In north Norfolk, linear swathes of land are being cleared for three underground cabling routes, each the width of a three-lane motorway. Two are north-south, connecting Weybourne and Norwich, and the third is east-west from Happisburgh to Necton, connecting Norfolk’s offshore wind turbines. I was pleased to see EN-5 mention how, in establishing these linear connections, there needs to be a greater sense of care around reconnecting important habitats, green corridors and biodiversity stepping stones, not only for nature but for people in reinstating public footpaths, cycleways and ways to get people to connect with and be outdoors in nature. That is to be welcomed, but how will it happen in reality? In putting in this linear cabling, ancient hedgerows often have to be removed. How can it be done in such a way to restore some of the habitats that are being removed?
The noble Lord, Lord Howell of Guildford, mentioned pylons. National Grid has plans for a pylon route which will march across 180 kilometres from Norwich to Tilbury, with only part of it underground when it crosses the Dedham Vale area of outstanding natural beauty. I urge that cabling of the section crossing the Waveney Valley should also be undertaken. However, if underground cabling was used for any new national grid transmission lines as default, this would help to ensure fewer harmful long-term impacts for residents, for the environment, for settings of heritage assets, for tranquillity and for the countryside. Would the Minister agree that, to have an effective long-term strategy for the power network, it is essential that these 1960s lowest-cost solutions are no longer the default setting?
Overall, these national policy statements are part of facing the challenge of climate change and providing clear direction for planners and developers working on electricity network infrastructure. This needs to be achieved in such a way that people, place, nature and landscape can be protected and thrive as we make the vital transition to non-carbon burning energy sources a success.
Baroness Coffey (Con)
My Lords, I start by declaring an interest: I still live in Suffolk and probably within a mile—perhaps even 500 metres—of where a substation is proposed to be built. The area of the country that I used to represent in the other place is likely, within 10 to 15 years, to accommodate about 30% of the UK’s electricity supply, through generation and the substation infrastructure for offshore wind and interconnectors. That is all within an area of 25 square miles, at best, and includes just one extra pylon, which is on-site at Sizewell C. As a consequence, local people are understandably concerned about the scale of development that is happening in one of the most environmentally protected parts of the country, which is critical to the Government for meeting their legislative targets set out in the Environment Act 2021.
My issue here is not about Sizewell C. I appreciate that my noble friend Lord Howell of Guildford has strong views on what sort of nuclear technology should be placed there, but mine is more a beef with the onshore infrastructure for offshore wind and interconnectors, which have been put on green land that is being used right now for food production and environmental enhancement. Quite frankly, this greenfield is being trashed as we speak. Farmers have not been able to plant food. In the grand scheme of things that does not mean that the shelves will be empty but, nevertheless, yet another field is being taken out of food production.
I have tabled an amendment to the Planning and Infrastructure Bill. There is no sight of any assessment that the Secretary of State would have had to undertake in line with Section 19 of the Environment Act 2021—the environmental principles policy statement. Instead, we have a habitat regulations assessment, outsourced to Atkins. In essence, the non-technical summary says that because the updated energy NPSs
“do not set out specific locations for development”,
The assessment is “high-level”, and therefore we cannot know the potential effects
“until specific proposals come forward”.
The challenge here is that NESO knows exactly where lots of energy projects will be because it has already issued connections. It does this because of the long-term nature of some of them, and I am conscious that there will be a change, helped by the legislation coming through in the Planning and Infrastructure Bill, that is not on a first come, first served basis. For what it is worth, I think the primary legislation is not as strong as it is claimed to be and that it could be more development-ready, but it knows where this electricity generation will happen, particularly for the 2030 clean energy plan, so I was very disappointed that Ed Miliband decided not to be more—how can I put it?—probing.
That said, on other aspects of the environment, I am pleased to see that the Secretary of State has, contrary to the proposals in the Planning and Infrastructure Bill, kept the mitigation hierarchy. That is in EN-1 paragraph 4.6.10. I am also delighted to see the reference to the local nature recovery strategies in paragraph 4.6.14. That is good news but, frankly, the NESO knows where these sites and the projects will be, so although Parliament is not being misled, it is being let down with this crass comment through the HRA.
In terms of local communities, of which I am still part, the public consultation on these proposals started in April and concluded on 29 May. When can we expect to see at least the summary responses, if not the Government’s response to it overall? It would have been helpful to have that before this debate. I should have said at the start that I could easily speak for 15 minutes on each of EN-1, EN-3 and EN-5. I requested of the Government that we have this debate, so I am glad we are having it. There has not been one in the Commons, and I am tabling an amendment to the Planning and Infrastructure Bill to try to rectify that for the future.
EN-5 talks about sulphur hexafluoride, which has been used in industry for the last 50-plus years. It is brilliant at what it does. It insulates really well and contains things. The challenge is that it leaks, and it is the most potent greenhouse gas known to man. If you think that carbon dioxide is one, SF6 is the equivalent of 24,300.
Cooling all these substations then becomes a challenge for a lot of the rural communities that this is going to affect. By the way, one substation is the entire width of Parliament Square going right to the edges of the buildings. In fact, it is four times the size of that and the height of the Treasury. That is just one. Most of these places are interconnections. Offshore wind farms need two of them: one for the developer, and then National Grid, NESO or whoever runs it now will need its own. To give the Committee a sense of proportion, the volume of this room, the Moses Room, then becomes the length of the House of Lords Chamber and the Royal Gallery. That gives noble Lords a sense of proportion of moving away from SF6—which, by the way, I think is reasonable, but that is what is happening on green fields or is being proposed right around this country. That is what many rural communities are very upset about.
The other thing that surprises me in EN-1 is that paragraph 3.2.4 states:
“It is not the role of the planning system to deliver specific amounts or limit any form of infrastructure covered by this NPS”.
Why not? That is exactly what the strategy should be about. We have moved from a hub-and-spoke basis for the grid in this country to stuff coming principally from the coast and rural areas. The challenge becomes saying that it is the nature of a market-based energy system.
How have we ended up with this in the first place? When ScottishPower Renewables was developing EA1, it said it was going to do it through direct current, and that it is the best way, especially high voltage DC. For what it is worth, I think the Government should be insisting on HVDC as it is the most effective way. It would reduce the amount of generation and inter- connection that we would need as a country if we moved to HVDC as the principal method of transmission. That was what ScottishPower Renewables started off with.
To accommodate that, ScottishPower Renewables worked with the council, the developer and various bodies. The cable came onshore at Bawdsey. It went through Martlesham on its way to Bramford, an already developed station. The decision was made to allow the compulsory purchase of a much wider area so that, when other windfarms came onstream, the cables could literally be pulled through. It needed only one tunnel, basically, one channel. It needed to be quite wide because there is a lot more heat with DC, so you need more land to be able to absorb that. When you are doing underground cabling, that is the main difference between DC and AC and why there is now this strong preference—it was actually by the previous Government, my Government—for wanting pylons everywhere. However, in the contract for difference, ScottishPower Renewables basically did not get what it wanted, so it switched to the traditional AC, which meant fewer turbines. The same amount of land was taken, but ScottishPower Renewables did not now have to find other sites along the Suffolk coast to absorb this—is my intention to keep going, so I had better sit down.
Baroness Coffey (Con)
My Lords, I was considering aspects of information that would be provided. It would have been helpful to know at least the summary responses, but we will have a further opportunity at the next stage of consideration to go into this in more detail.
Building on what the noble Lord, Lord Grantchester, mentioned, it is right that energy from waste should not be considered any more, partly because we have more than enough now, and planning permission does not need to be granted to any more projects. I fully respect the circular economy approach. That was started by the previous Government and has been continued, which is good news.
I go back to my concerns. Most of my focus is on EN-5, which covers transmission infrastructure on the ground, underground, overground or in the air. One thing slightly concerns me in paragraph 2.2 on
“Factors influencing site selection and design”.
In paragraph 2.2.2, regarding:
“the location of new generating stations or other infrastructure requiring connection to the network … system capacity and resilience requirements determined by the National Energy System Operator”,
two things happen. I am slightly surprised that an extra factor here is not: where is the electricity needed? Surely, the siting of all this network should be as close as possible to where it is needed. That is energy efficient.
I understand the issue about nuclear power stations. I do not accept it for SMRs, but for something like Sizewell C, I can understand why that needs to be away from places of high population. On the other elements, I think in particular of the connectors. There are two interconnectors, one from Belgium called Nautilus, which is now going into the Isle of Grain after a successful campaign to go to a brownfield site with existing substation infrastructure. The other one is LionLink, which is due to come into a place called Walberswick. Officials were quite open about this. They were not going further down the coast because they would have to crisscross 17 other cables. The seabed in that part of the country is almost like the M25 on steroids. The National Security Strategy Committee should be considering this because this also comes back to energy security and resilience.
Another interconnector that has already been granted permission is called Sea Link and is basically backup insurance. If the network goes down in the south-east of England, energy can be diverted from Sizewell C. That is costing £1.5 billion, and a lot of this energy gets lost in transmission. The majority of electricity in this country is needed in London and the south-east, so why are we not putting more into areas closer to London and other parts of the south-east where there is existing infrastructure? By that I mean Bradwell and the Isle of Grain. It would be straightforward to develop something in Tilbury. As a consequence, I am concerned about that aspect.
I am looking at paragraph 2.12.3. The right reverend Prelate the Bishop of Norwich talked extensively about East Anglia, which I would expect him to do. I know it covers parts of where I live. Twice in this document, the east of England is singled out, predominantly, but not exclusively, East Anglia. It also covers significant parts of the east coast all the way from Scotland down to the Wash. That is why I hope that careful consideration will be given to the responses coming from that part of the country.
I will speak briefly regarding something that comes up in the Planning and Infrastructure Bill as well as here. The Minister has already referred to it. It is the public benefit. This goes wrong when damage to the public benefit or public area is set aside when the commercial benefit collapses. I would have more time for this thinking through the national policy statement if, in a market-led system, they sign up to it and do it and do not pull out, causing more misery for people in different parts of our country.
I could go on. When I last debated a previous national policy statement in the other place, I spent 45 minutes on it, and that was on just one statement. I will not do that today, but I just say to the Minister that I understand how much work has gone into this by officials and I understand that the overall thing is energy security and net zero. I get that, but these things impact local communities. I ask him to think about the genuine science, the evidence about the transmission of energy and about biting the bullet on getting a lot of this infrastructure a lot closer to London rather than destroying some marvellous parts of our country.
Baroness McIntosh of Pickering (Con)
My Lords, I thank the Minister for introducing the debate today. I also wish his predecessor well, who I understand chose to retire. He will be greatly missed. We enjoyed debating with him, as we enjoy debating with the noble Lord, Lord Wilson. I will focus particularly on the impact on the countryside, rural communities and coastal communities, building on the arguments put by the right reverend Prelate and my noble friend Lady Coffey. I will also focus on the cost and whether it will be put entirely on the standing charge, how it will be paid for and future energy needs.
The Minister, in introducing the debate, referred to the Select Committee report, published on 7 July. It must have made quite uncomfortable reading for the department because it was entirely at one with the Government’s approach. There is one thing that I welcome with this approach, if I understand it correctly, and I hope the Minister will confirm this. A number of noble Lords have touched on the fact there have been very disjointed planning applications. You might have an application made for, normally, an offshore wind farm—I regret, in passing, the moratorium on onshore wind farms being lifted; that is deeply regrettable—then there is a separate application for the coastal station where the electricity generated comes onshore, and then there is a separate, third, application for the overhead pylons. My understanding is that this will treat all such applications as one planning permission application, so at least the public then know what they are in for.
What I think the department must regret is what the Energy Security and Net Zero Committee says,
“We have been immensely frustrated and disappointed by the disjointed engagement which the Government afforded us, severely limiting our ability to create added value, by test and challenge, which is the purpose of involving Select Committees in the scrutiny of National Policy Statements. The Government has failed to respect the value of Parliamentary scrutiny in this process”.
Having served on Select Committees in both this place and the other place, I greatly value the contribution that they make. They have the time and the expertise. The committee went on to say that, ,
“we feel that the National Policy Statements should plainly acknowledge that this framework represents a significant departure from a market-based energy system. The relationship between National Policy Statements, the Land Use Framework and strategic plans needs more precise clarification, particularly regarding how the availability and prospects of a grid connection should be considered within the development consent process”.
I place on record my regret that we have not seen the land use framework, which the Minister’s colleague, the noble Baroness, Lady Young of Old Scone, has asked for on several occasions. It would have been very helpful to have seen that before this debate.
Whether as an MEP in East Anglia or an MP in North Yorkshire, I have always represented deeply rural constituencies. What I regret about the statements before us this afternoon is that they will, in effect, trash the countryside. I am honorary president of the UK Warehousing Association, which had a campaign to have solar panels on roofs. This has been immensely successful. I ask the Minister why it is that the excess energy they are creating—more than they need for their own use—is not able to be fed into the national grid? This afternoon we are talking about infrastructure projects which are going to criss-cross the countryside, effectively trampling over rural and coastal communities, with no benefit to them, all to feed into the national grid. If we have a green policy that is proven to work by putting solar panels where I think they are more appropriate, on roofs, why can the excess energy generated not be fed into the grid?
I cut my political teeth very early on when a second line of pylons were being applied for under a Labour Government in 1997-98. They were met with horror from the local residents, who set up, under the brilliant chairmanship of the late Professor O’Carroll, an organisation known as REVOLT. I would like to see that organisation commence again—it stood for Rural England Versus Overhead Line Transmission—for precisely the arguments my noble friend Lady Coffey has rehearsed, and I will not repeat them. Why are we transmitting energy for hundreds of kilometres? In the old days it used to be that 10% or 15% of the energy created was wasted. I am told that has been reduced to 5%, but it is nonsensical to waste energy.
We then had a situation in the north of England. I know it is a very long way away, and many of you probably do not know where Newcastle and North Yorkshire are—I am speaking to the wrong person with the Minister present in the Room. During Storm Arwen, we lost electricity in North Yorkshire and the north-east for nine days. There was no hot water and no heating, and it was in the winter. So it would be nonsensical to plan even more overhead lines, which are also subject to adverse weather conditions.
We also find ourselves in a situation in North Yorkshire and the north of England where, even if we wanted to drive an electric vehicle, there is no way we can charge them. Why can we not have some of the electricity that is going to be transported great distances? Why can we not keep it more locally, if we have to drive these wretched vehicles that will only do 100 miles? Apparently, they will do 300 miles if you do not have the air conditioning, heating, or radio on; if you are going to drive at 20 miles per hour they will do 300 miles. If you want to drive at 50 or 70 miles per hour for a longer distance with air conditioning or heating in the winter and the radio on, you are looking at 100 miles. That is just not sustainable. I hope the Minister will take the opportunity to look at this.
On EN-5, the other issue with overhead pylons is very difficult. I had a constituent who came to see me when I was an MP, whom I found very disturbing. She came into my surgery in the middle of winter. She turned all the lights off in the room and said she was being electrocuted by the electromagnetic field that is all around us and, because we then had two lines of pylons in North Yorkshire, she was more subjected to it. Page 31 of EN-5 talks about electromagnetic fields. Paragraph 2.10.13 states:
“Where EMF exposure is within the relevant public exposure guidelines, re-routeing a proposed overhead line purely on the basis of EMF exposure or undergrounding a line solely to further reduce the level of EMF exposure are unlikely to be proportionate mitigation measures”.
I beg to disagree. If you are driving under this pylon and your radio goes berserk, that indicates there is a very magnetic force coming from those overhead pylons. I urge them to put them underground wherever they can. I would like to challenge the Minister. Why do these companies say they cannot afford to place these overhead lines underground? They are making—dare I say—obscene amounts of money. I think they have to justify why they cannot underground them.
I seem to be honorary president of most organisations so, for good measure, I declare my honorary presidency of National Energy Action. It is very concerned about the impact of cold weather and how the warm homes discount is going to be distributed. That is a separate debate for another day. What concerns me is that the standing charge seems to cover most of these connections and all the infrastructure that we are talking about this afternoon. I would like the Minister to reassure me that the standing charge is not going to be increased as a result of the infrastructure before us this afternoon. I will just complete my sentence and say that I hope that the warm homes discount could be increased for those who are already in receipt of it, who we know are living in energy poverty, rather than spreading it more thinly to those who have recently been identified.
I turn to the impact on the countryside of solar farms, battery storage plants and the interconnectors to which my noble friend Lady Coffey referred, and the damage to the countryside that the right reverend Prelate referred to. I hope that this is something that the Minister will consider. There is an application for a battery storage plant to be built very close to a school in my former constituency, near to my cottage. I understand that these battery storage plants are highly flammable, so that begs the question of why it is being built within half a mile of a school and the town of South Kilvington. After they have stored the energy, how are they going to transport it? Is that here today? Will there be yet more pylons there? That would be very helpful to know.
In the recent past, we have been exporting household waste from North Yorkshire to Holland, where it is burned. I am fully signed up to energy from waste, as I am to the heat networks that the right reverend Prelate referred to. I understand that we have an energy-from-waste plant in North Yorkshire, and again we are not allowed to use the electricity and heat generated by that plant. I think that is something that communities would accept as a positive.
I end by asking the Minister whether he will look at the environmental damage that all three statements before us this afternoon refer to. It can be mitigated by looking at the electromagnetic fields and reducing the environmental damage and could be totally mitigated by putting overhead lines underground. If we are going to have clean energy, there is going to be a hit for farmers. We have it on the record that 10% of farmland and 10% of fisheries are being taken out of production by the clean energy proposals. There has to be something in it for people in the countryside if they are going to have all this infrastructure placed on them just for the benefit of people living in London and the south-east of England. I hope that that might be explored within the statements before us to ensure that energy can be provided as close to the point of production as possible. I await with great interest to hear noble Lords’ responses.
Earl Russell (LD)
My Lords, I start also by paying tribute to the noble Lord, Lord Hunt, and the work that he did as a Minister. I know that it was his decision to step down, and it has been really good to see him about the House since he took that decision.
On these Benches, we very much welcome the publication of these revised draft energy policy statements. As the noble Lord, Lord Howell, said, they are extremely comprehensive. These documents are absolutely critical, and we welcome the Government’s efforts in bringing them forward; we understand what a great job of work that is. We welcome the fact that they integrate our net-zero targets.
I echo the points that other noble Lords have made about how it would have been useful to have some of the consultation responses, and the point that the noble Baroness, Lady McIntosh, made about the involvement of the Select Committees. We welcome the overall direction that the Government are taking in these policies, but it is really important that we look at them, because they are big and important policies. Perhaps next time we could do one policy at a time, which would provide better scrutiny. However, I recognise, as the noble Baroness, Lady Coffey, said, that these have not been debated at all in the other Chamber, so we need to look at them.
I turn to EN-1, which serves as the overarching policy document, the master blueprint for the main energy infrastructure projects in the UK, designated as nationally significant infrastructure under the Planning Act 2008. It provides a primary policy framework for decisions made by the Secretary of State. This is the first time that this document has been updated since 2011, so it is really about time that we did it. EN-1 has been updated to bring the clean power 2030 action plan into the section previously covered by net zero. The aim is to put the plan in the forefront as a primary policy embedded by the NPSs. The clean power 2030 action plan, formed in December 2024, proposes that clean energy sources provide at least 95% of the UK’s energy by 2030.
Some of this debate has been about people in London taking power to destroy the countryside, and to my mind that is completely the wrong way of framing it. We did not frame it that way when we were talking about burning hydrocarbons. But the Government need to take people with them and support communities. Energy is for all of us, and we need to make sure that we include, talk to and listen to communities as we transition in energy.
There is a lot to be set here for net zero. We are talking about 43 to 50 gigawatts of offshore wind, 27 to 29 gigawatts of onshore wind and 45 to 47 gigawatts of solar. The Government recognise the role of the strategic spatial energy plan and the centralised strategic network plan; the land use framework has also been raised. A lot of policies need to come together to drive this energy transition.
A critical concept with EN-1 is the critical national policy priority for nationally significant low-carbon infrastructure. The CNP applies a presumption that the urgent need for such infrastructure, along with its national security, economic, commercial and net-zero benefits, will all generally outweigh other residual impacts that are not addressed by the mitigation hierarchy. As other noble Lords have, I welcome the mitigation hierarchy throughout all these documents—the need for good design and to limit damage. That is in stark contrast to Section 3 of the Planning and Infrastructure Bill, but we welcome the detailed plans that are in these documents, in that way.
Notably, I also welcome that the energy from waste facilities is now excluded from the CNP. That is very welcome, as it does not now meet the definition of clean power technology under the clean power action plan. We welcome this, and it is worth noting that this form of energy is now the most polluting form of energy that we generate. This statement explores how waste energy can be reduced using low-carbon technology and energy-efficiency measures. Negative emissions can also be balanced by greenhouse gas removal technologies. The document sets out requirements for carbon capture-ready designs for certain power plants. Again, we welcome this; we recognise that the Government have targets for 20 to 30 megatons of CO2 to be captured each year by 2030 and that the need for this technology is recognised by the Climate Change Committee. We also welcome considerations about climate change adaption and resilience in the planning framework; this is really important stuff.
I have a couple of questions for the Minister on EN-1. How will the Government ensure that the 2030 target is not perceived as a proverbial cliff edge and that, after the 2030 delivery timeframe, projects that are crucial for the 2050 net-zero target will continue to receive the necessary support? Indeed, in many ways, the period after 2035 is when we will have some of the most difficult and challenging decisions to take. There is a need to continue that pace and scale after we come through clean power.
We welcome the inclusion of climate resilience but are the Government doing enough in that space? We are increasingly seeing things having a real impact on our energy generation and transmission—whether high temperatures, floods, wildfires, rising sea levels or the siting of Sizewell—and every bit of our critical energy infrastructure needs to be adaptive and resilient to the changing world.
Finally on EN-1, we call for the land use framework, local plans and local nature recovery strategies to also be considered alongside planning permissions for all new energy infrastructure, such as flood risk management, climate mitigation and biodiversity, to find an optimum balance between food production and ecosystems.
We also welcome EN-3, the National Policy Statement for Renewable Energy Infrastructure, particularly the inclusion of the ambition for onshore wind to supply up to 50 gigawatts by 2030. I do not know why it was excluded in the first place—that is a question I might want to ask the Minister—but we are really pleased that it is back in this plan, with the revisions, where it should be. The wind is free; we just need to make the windmills to generate it. It is good for us and our energy security, and we need to do much more of it.
Solar photovoltaic generation is key to the clean power 2030 mission. I note that EN-3 describes it as cheap, versatile, and effective and clearly states a preference for
“brownfield, industrial and low and medium grade agricultural land”.
I welcome some of the Government’s policies more broadly. Recently, we have seen the future homes standard, we have talked about balcony solar and rooftop solar, and the Government are adding solar to carparks.
I question some of the net-zero rhetoric about our farmland. It is not taking 10% of our farmland, and it is perfectly possible to have farmland and solar energy. I also really welcome the inclusion of agrivoltaics in the policy. As we face an increasingly hot climate, there are lots of ways in which solar panels can work particularly well with farmland, grazing animals and efforts to increase our biodiversity. These things can coexist. The idea that it is either/or is simply not correct. How will the Government promote agrivoltaics as a policy and make sure that farmers are aware of it and know how to work with it?
We have talked a bit about heat from waste, so I will leave that for now. We welcome the strengthened section on undergrounding, which we have conversations about. I think all noble Lords are aware that undergrounding is 10 times more expensive than pylons, but it needs to happen in certain sections, particularly our protected landscapes. I recognise that, but is it is not an option to have it everywhere. It has its own environmentally damaging consequences: it involves encasing in concrete and every time you have a fault in the line you have to get out the sledgehammers and smash the concrete open to repair the line. It simply is not an option, even with the best will in the world.
There have been some issues with putting pylons out at sea. Energy UK raised the need to do more to mitigate the noise from piling. I know that there is some innovative technology, such as using water bubbles to try to control the impacts of noise on the marine environment.
Moving on to EN-5, the grid is crucial, and it has lacked investment. We discussed the NESO Heathrow report yesterday. We have £70 billion that needs to be invested by 2025 and much more by 2050. Against that background, predicted demand has doubled. The noble Lord, Lord Howell, challenged us on that and said it could be much more. We need to get this stuff out. We need to get the grid updated so that we can get to net zero, and we need a reliable and resilient electricity grid. That needs to happen.
I welcome the Holford rules and the Horlock rules. The Minister talked about updating them. Will he say a bit more about that? When will it happen, what will it look like and how will they work with communities to do that? These things are important. I desperately want to get away from pylon wars. I want to make sure that our communities are supported and get benefits from renewable energy infrastructure near their homes, such as money off their bills. We must support communities, take them with us and include them in the energy transition. I welcome what the noble Baroness, Lady Coffey, said about SF6 emissions. Will the Minister say more about what plans the Government have? We should really stop using that stuff.
The National Grid has raised some concerns about development consent orders. It lacks the rights that other utility companies have, and it does not have the ability to safeguard land. It has also raised the issue of wayleaves and the relationship with the Public Order Act.
To conclude, I will make some general points. A number of tensions exist between the delivery and the quality of the assessments in these documents. It is important to address cumulative impacts, which is an issue running through them. I have talked about pylon wars, but I reiterate that I think we can balance these things. I would like to see the Government produce an annual report on our transition to net zero. It is important in terms of the resilience of the grid and the huge transition. I would really like to see more of this stuff put into the public domain, debated and put through Parliament. I think that would help to stop disinformation and other kinds of ideas coming forward.
I want to ask the Minister about greater use of AI. I welcome some of the stuff about moving away from radial lines. There is talk of the bootstraps and interconnectors. We have an opportunity to design this system and reduce the number of places that we have these cables coming onshore. Is NESO able to use AI better to look at how we redesign the grid, what order we do things in and how we connect renewables? There are lots of opportunities for doing things more efficiently, better, saving energy and in the right order. We generally welcome these policies; they are really important. I have not got time to go through everything. I thank everybody who has spoken, and I look forward to the Minister’s response.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, the Government’s proposed updates to the national policy statements for energy, EN-1, EN-3 and EN-5, aim to lay the legislative and planning groundwork for the clean power action plan 2030.
I endorse entirely the comments of my noble friend Lord Howell of Guildford and other noble Lords in lamenting the retirement of the redoubtable noble Lord, Lord Hunt of Kings Heath, who was such a strong supporter of nuclear power, in particular. I also endorse my noble friend Lord Howell’s critique of the choice of EPR technology for Sizewell C.
As the right reverend Prelate the Bishop of Norwich observed, there is much to welcome in these documents, but ambition must be tempered by realism grounded in economic and national security. It was a Conservative Government who made the UK the first G20 country to halve carbon emissions while growing our economy. What we cannot support is a transition that forgets the people who power our industries, who pay their bills and taxes and who depend on British energy for their livelihoods.
The Government’s so-called clean power 2030 plan, now at the centre of the revised EN-1, sets a target for 95% of UK electricity generation to come from clean sources by 2030. To meet that goal, developers are now directed to bring forward enormous capacities: up to 50 gigawatts of offshore wind—let us hope that some of that may be generated by the nascent offshore floating wind industry in Wales—29 gigawatts of onshore wind and 47 gigawatts of solar. Incidentally, the technology now exists to place solar panels on reservoirs successfully, which should be explored. These are not modest targets, and the reality is that ideology without realism leads to economic harm. Just last week, we saw the impact of this Government’s choices when Lindsey oil refinery crashed into insolvency. Energy is now the single largest cost in operating a refinery—indeed, operating all heavy industry—and this Government’s failure to deliver competitive industrial energy prices is pushing UK manufacturers to the brink.
The Government should listen to the warnings of Sir Jim Ratcliffe of INEOS, who has said that the chemicals sector in this country is now “facing extinction” because of
“enormously high energy prices and crippling carbon tax bills”.
We are now looking at a situation where only four oil refineries may remain in operation. To put that in context, Britain had 17 in the late 1970s. The industry, like many others, is being driven into the ground, not by foreign competition but domestic policy failure. Our path to net zero cannot cost us jobs, close our refineries, undermine British manufacturing and leave us more dependent on foreign imports. This is not decarbonisation; it is deindustrialisation.
Since the closure of Grangemouth, we have seen no meaningful action from the Government to address the structural challenges facing heavy industry. They are failing to tackle the fundamental issue: the cost of energy for British industry is simply too high. In the long-term, nuclear power can mitigate against this. I therefore ask the Minister plainly: what will this Government do to bring energy bills down for all industrial energy consumers, not just those covered by the narrow energy-intensive industries compensation scheme? Right now, UK industry is uncompetitive, and clean power 2030 will simply make it worse.
The updated national policy statements also fail to answer how we will maintain a stable, secure and affordable power system in the face of massive intermittent generation. As Professor Dieter Helm of the University of Oxford has explained, the costs associated with addressing the problem of intermittency has been ignored by
“almost every calculation of the costs for these renewables”.
It is the total system cost that matters, not just marginal cost. Yet these statements provide no clear answers on how we will manage the added infrastructure, back-up power and storage costs that are integral to this expansion. I therefore endorse the request by the noble Lord, Lord Grantchester, for an update on battery storage development, to which I would add pumped hydro storage.
We are investing billions into offshore and onshore wind and solar panels, while ignoring the fundamental engineering challenge of how to keep the lights on when the wind does not blow and the sun does not shine. I am grateful to my noble friend Lady Coffey for drawing the Committee’s attention to paragraph 3.2.4 of EN-1, and the statement that it is
“not the role of the planning system”
to limit any form of infrastructure. I also agree with her commitment to HVDC cabling. Perhaps, instead of pylons of undergrounding, power generated offshore in East Anglia could be transported via a subsea HVDC cable—just a thought.
There is no clear path to long-term baseload capacity, and no competitive framework for industrial consumers. I say again that, if clean power 2030 costs us our industrial base, weakens our energy sovereignty and drives up costs for working families, it cannot be considered a success. We do not serve the national interest by being the greenest country in the world if the price is the loss of our manufacturing base and the impoverishment of hard-working British people. That is not climate leadership; it is economic self-harm, and a lesson that others will learn from.
Of course, we want to strive to achieve a clean energy system, but we also need resilient, reliable and affordable energy. That is what will keep the lights on, protect our industries and uphold our national security. I therefore urge the Minister to return to the House with a clear plan, as the noble Earl, Lord Russell, suggested, for delivering security and affordability of the UK’s energy supply.
Lord Wilson of Sedgefield (Lab)
I thank every noble Lord who has taken part in this debate. It has been really interesting and a lot of points have been touched upon. It just shows how important everybody considers this subject. It is about securing the future of the country, if not the world. I pick up a point that the noble Baroness, Lady McIntosh made. As you can probably tell from the accent, I am from the north-east of England as well and live in the countryside. I remember that, when I was growing up, if you looked out of my bedroom window, you could see the Yorkshire Moors in the distance, a pit heap down the hill and two lines of pylons, which are still there. The pit heap is not there. It has been reclaimed. If you do not come from the area, you would not have known it was ever there. The Yorkshire Moors are still there on the horizon and are just beautiful. Now I live a bit further away from where I grew up. I overlook the Dales, the Yorkshire Moors still and the Vale of York, so I am well aware of what it is like to live in the countryside and how important it is that get this planning right.
Reflecting publication of the Clean Power 2030 Action Plan, the overarching energy NPS will be updated to bring clean power 2030 front and centre as the primary policy that the NPSs enable. The changes also provide guidance to developers and examining authorities who submit their applications for onshore wind applications under the NSIP regime. Reflecting these policy changes, and the others outlined today, the updated NPSs provide greater clarity to developers, statutory consultees and decision-makers to speed up the planning process and help achieve this Government’s clean power 2030 target.
I will respond in turn to noble Lords and the right reverend Prelate. I will do my best to try and answer the questions and, if I cannot, I will write to noble Lords. I welcome the comments of my noble friend Lord Grantchester, particularly on the work of Great British Energy and the National Wealth Fund. The noble Baroness, Lady Coffey, and the noble Earl, Lord Russell, raised the point about having the details of the public consultation responses to these documents. The Government are undertaking analysis of the consulting responses in parallel with the parliamentary process and, at this stage, we are not in a position to provide details on the responses. The Government intend to publish a response to the public consultation on the NPSs later this year.
I can assure noble Lords that the new approach to strategic network planning will consider long-term system needs, and recommend the necessary transmission upgrade, looking forward to 2050. It will be informed by the strategic spatial energy plan and closely linked to the regional energy strategic plans, which will provide the necessary regional and distribution plans. The updates to the NPSs in relation to the energy from waste, alongside the Defra statement of 30 December 2024 on the publication of the Government’s Residual Waste Infrastructure Capacity Note, will help to ensure that the Government deliver the right waste infrastructure to support the transition to a circular economy and the Government’s commitment to meeting net-zero targets.
The Government have set the 100-megawatt NSIP threshold for onshore wind projects, following technological advancements in turbine technology. Over the past 10 years, the rated capacity of turbines used in UK projects has doubled to around 5 megawatts on average, with some of the largest projects proposing 6-megawatt or 7-megawatt turbines. The 100-megawatt threshold ensures that only the largest and most important projects that are genuinely nationally significant enter the NSIP process. Mid-sized projects can then progress using the quicker and cheaper local planning route. On 4 July, the Government published updated voluntary guidance on community benefits for onshore wind in England, setting expectations that developers pay community benefits of £5,000 per megawatt of instalment capacity per year for the operational lifetime of the project.
The 10-year infrastructure strategy commits the Government to greater integration and coverage of sectoral spatial plans, which will help to provide clarity to industry. This includes developing guidance to support the production of sectoral spatial plans. The newly created National Infrastructure and Service Transformation Authority will work closely with departments, regulators, arm’s-length bodies and local delivery partners to identify spatial trade-offs and synergies between infrastructure policies, plans and decisions in England.
Issues of capital spending plans and a green belt review are matters for the Treasury, but I will write to the noble Lord, Lord Grantchester, on that point. The Government consulted on the land use framework earlier this year, and we are currently considering responses to the consultation.
In relation to the question on what the Government are doing on batteries and funding, batteries have a vital role to play in decarbonising the power sector by 2030. They help to balance the electricity system at lower cost and maximise the output from intermittent low carbon generation, such as solar and wind. Thus they minimise investment in new generation capacity and network upgrades to meet peak demand.
The Government have outlined their plans for deployment of battery storage in the Clean Power 2030 Action Plan and we will work with industry, NESO and Ofgem to build on those actions through the clean flexibility road map announced in the action plan. The most recent capacity market auction awarded £1.5 billion in current prices of capacity market agreements for battery storage, with new-build batteries securing agreements of up to 15 years.
I thank the noble Lord, Lord Howell, and others for their comments regarding my noble friend Lord Hunt. I have covered his brief in this place. He has whipped his last session, which was in this Room. I know from experience and from what noble Lords have said that he was all over these issues. I think he will be a big miss on our side and for the House of Lords on these issues. I only hope I can fill the gap for a while.
The noble Lord spoke about the importance of nuclear power, in particular SMRs, to the energy mix. The Government are committed to delivering a new golden age of nuclear. The Government have committed £17 billion across the spending review period to the most ambitious nuclear new-build programme for a generation. Once small modular reactors and Sizewell C come online in the 2030s, combined with Hinkley Point C, more new nuclear will be delivered to the grid than over the previous half a century combined.
On SMRs, noble Lords will be aware that the new national policy statement on nuclear energy, EN-7, brings SMRs into the infrastructure planning regime for the first time. EN-7 criteria apply to all types of nuclear, including SMRs, and provide crucial new flexibility and certainty for the nuclear industry to work within.
The choice of European pressurised water reactors at Sizewell C will allow us to apply lessons learned during the construction of Hinkley Point C. The impact of these lessons learned is already being felt at Hinkley Point C. EDF reports that reactor two is being built 25% faster than reactor one. Once complete, the two EPRs at Sizewell C are estimated to power the equivalent of 6 million homes for 60 years, while making our energy supply cheaper and more secure.
On Sizewell C, financing is on the regulated asset base, RAB, model. We anticipate this model will ultimately bring significant savings for nuclear projects as the risk-sharing with consumers will lower the overall cost of financing when compared with the contracts for difference model. RAB is a tried and tested model used across UK utility networks, as well as large-scale projects, such as the Thames Tideway tunnel. Yesterday, EDF confirmed its 12.5% stake in the project. We have strong interest from a range of investors and will look to bring the process to a close shortly.
Unabated gas will continue to play a back-up role throughout the transition to clean power, ensuring security of supply. This means we will retain sufficient capacity until it can be safely replaced by low-carbon technologies.
Hydrogen transport and storage infrastructure will be critical to the development of the hydrogen economy and to meeting the Government’s net-zero and climate budget goals. It can support the clean power mission by enabling H2P to support electricity consumption. There is an urgent need for new carbon capture and storage infrastructure to support the transition to a net-zero economy, for which the NPS has clearly set out its support.
The right reverend Prelate the Bishop of Norwich raised the issue of high connection costs for churches seeking to decarbonise their heating. The connection quotes he mentioned were provided by the local distribution network operator. However, such connections can also be provided by independent connection providers, which may prove to be cheaper and faster. The NPS clearly sets out that, in order for a project to be economically viable as a combined heat and power plant, a generating station needs to be located sufficiently close to end-users with heat demands.
On undergrounding, the Government’s position is that overhead lines should generally be the starting presumption, except for in nationally designated landscapes, where undergrounding should be the starting presumption. Overhead lines are much cheaper to build, with undergrounding costing an estimated four and a half times more than overhead lines, according to a study published in April by the Institution of Engineering and Technology. The cost of building this infrastructure is borne by electricity bill payers so it is paramount that we keep costs down. In addition, overhead lines are much quicker and easier to build, cause less environmental damage, are much easier to maintain and repair and are easier to interconnect with existing circuits.
In response to the points regarding delivering the network ahead of the need, the new approach to strategic network planning will see NESO develop transmission network recommendations based on long-term modelling of energy generation and demand from the strategic spatial energy plan chosen pathways. The aim of this is to enable delivery of the network ahead of need.
I turn to some of the points made by the noble Baroness, Lady Coffey. I shall write to her on some of her more specific points. She will also understand that I will not make reference to projects in the planning stage, as it would be inappropriate for me to comment. The environmental principles policy statement has been considered throughout the NPS update process and due regard will be given to it prior to the final NPS being laid before the House. The NPSs do not set out where energy infrastructure should be located, as it is for industry to propose new energy infrastructure projects that it assesses to be viable, within the strategic framework set out by the Government.
The habitats regulation assessment and appraisal of sustainability are carried out on the framework set out in the NPSs. It is for individual projects to carry out their own environmental assessments, as they are required to do so by law. To ensure that development is undertaken to meet demand across the country, NESO is developing the strategic spatial energy plan. It will identify optimal locations for energy generation and storage infrastructure, taking into account a range of factors, including technology costs, distance from demand centres, cost of transmission and cross-sectoral demands on land. The plan will be published for consultation in the second quarter of 2026, providing the opportunity for all to provide feedback. The DESNZ is working closely with other government departments to ensure that the SSEP interacts cohesively with the creation of other sectoral plans and spatial strategies, such as the land use framework.
Regarding the points made by the noble Baroness, Lady McIntosh of Pickering, the Government have noticed the concerns of the Energy Security and Net Zero Committee that insufficient time was given to it to undertake parliamentary scrutiny of these three draft energy NPSs, and that the committee has made recommendations in that regard. We will address these as part of the Government’s response to the committee on the report.
EV charging in rural areas is an important point but a matter for the Department for Transport, and I suggest that the noble Baroness engages with it on this issue.
On the impact of electromagnetic fields from pylons, all overhead lines produce electric and magnetic fields, which, as stated in the national policy statements, can have direct and indirect effects on human health. However, the balance of scientific evidence over several decades of research has not proven a causal link between EMFs, which are produced by all power lines, and cancer or other diseases. Nevertheless, to prevent known effects, the International Commission on Non-ionizing Radiation Protection developed health protection guidelines in 1998 for both public and occupational exposure. Government policy is that exposure of the public to EMFs should comply with these guidelines, and all planning applications for overhead lines should show evidence of this compliance.
On standing charges, the Government will work to ensure that there are clear marked frameworks that promote effective competition and deliver an affordable, secure and reliable energy system. Government support for specific technologies and projects will depend on clear value for money for consumers and taxpayers.
On community benefits for the countryside, we will ensure communities directly benefit from the clean energy infrastructure they host. On 21May, we published a working paper on community benefits and shared ownership of low-carbon energy infrastructure.
The noble Earl, Lord Russell, while accepting a lot of what was said in the statements, asked whether the focus on 2030 will reduce focus on paused 2030 projects. The capacity set out in the clean power action plan will be used to create a pipeline of viable projects to meet clean power by 2030 and beyond to 2035. In 2026, we will also publish a strategic spatial energy plan, looking at the future energy system from 2031 to 2050.
On the noble Earl’s point on climate resilience, he will join me in welcoming yesterday’s publication of the Government’s resilience plan. I mentioned it in the debate on the Statement on Heathrow. The NPS set out that the applicants should demonstrate that their proposals have a high level of climate resilience built into them. We are also aware that agrivoltaics—the integration of solar with arable farming—is a rapidly developing industry, and the Government are working to understand the opportunities to exploit this technology. Subject to the outcome of Defra’s rapid evidence review on the potential of agrivoltaics, we will work together with the solar sector to explore future research, demonstrations and opportunities for those systems in the UK.
On the noble Earl’s point on the Holford and Horlock rules, the National Energy System Operator is currently developing the new set of electric transmission design principles, which will be subject to public consultation.
On the points made by the noble Baroness, Lady Bloomfield, on optimising the network, the strategic network plans carried out by NESO, such as the centralised strategic network plan, will take a holistic view of the network upgrades. These recommend network upgrades optimised by balancing environmental and community impacts alongside deliverability and economic cost. The CSNP, for example, will recommend whether a route a route should be offshore, onshore or HVDC underground.
The noble Baroness is aware that our national policy statement on nuclear will enable nuclear and industrial decarbonisation by supporting smaller nuclear projects. In addition, we are providing a pathway for privately led nuclear projects to be deployed.
Every family and business in the country has paid the price for Britain’s dependence on foreign fossil fuel markets, which was starkly exposed when Putin invaded Ukraine. British energy customers were among the hardest hit in western Europe. The Government’s clean power mission is the solution to this crisis. By sprinting to clean homegrown energy, the UK can take back control of its energy and protect both family and national finances from fossil fuel price spikes with clear, affordable power.
Baroness McIntosh of Pickering (Con)
I quite understand that the Minister will not comment on a specific planning application but the point about battery storage plants being highly flammable is of deep concern. If he can write to me, that is fine. Also, how is the electricity that has been stored to be sent to the grid? Will that again be via overhead pylons?
Lord Wilson of Sedgefield (Lab)
With great pleasure, I will write to the noble Baroness on that point.