Lord Wilson of Sedgefield
Main Page: Lord Wilson of Sedgefield (Labour - Life peer)Overarching National Policy Statement for Energy
Lord Wilson of Sedgefield Excerpts
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 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.