Energy Bill [HL]

Debate between Lord Hardie and Lord Hain

Tuesday 12th April 2016 Lords Chamber

[Lord Hardie (CB)]

My Lords, on Report I drew attention to the unfair effect upon a development on Skye. The original provisions about the date upon which the guillotine would fall on new onshore wind farms discriminated against a development at Glen Ullinish in Skye which had planning permission, control of the land, the support of the local community and an agreement to link to the grid; the developers were paying money to the grid in fulfilment of that agreement. The only reason why the development could not go ahead was that the grid had to be upgraded, and that could not be achieved within the appropriate time.

I voted with the amendment that removed the clause from the Bill, but afterwards I wrote to the Minister to explain that that was the only option I had. I called on him and the Secretary of State to consider accommodating this unusual situation. I am grateful to the Minister, the Secretary of State and officials in the department for giving this matter consideration. Unlike the noble Lord, Lord Foulkes of Cumnock, I read the new Clause 32LL as a solution to the difficulty that there is a grid or radar delay condition. I seek confirmation from the Minister that I am reading it correctly, but I genuinely think it has enabled the development at Glen Ullinish to proceed. As I indicated in my letter, if that problem were resolved and a clause were brought back that accommodated this issue, I would support it, subject to the Minister’s confirmation that my understanding of Clause 32LL is correct.

[Lord Hain (Lab)]

My Lords, I tabled Amendment 7T and took the liberty of giving the Minister a copy of my draft speech in advance, in the hope of his co-operation and acceptance of the amendment. The Bill as it stands puts at risk a multimillion pound investment in Wales in and around my home area of Neath Port Talbot, which is already facing massive economic haemorrhage resulting from the threat to Tata Steel. The issue at stake relates to an already consented project, Gamesa’s Llynfi Afan renewable energy project, which has had its planning condition varied through a Section 73 consent to allow for a different road access route. The project is ready to start construction, and some of the major work is going to local businesses, with obvious positive implications for jobs, which in that area is welcome.

On 27 August 2013, the Llynfi Afan renewable energy project was granted consent by Neath Port Talbot County Borough Council. Previous consent had already been granted by two other local authorities, Bridgend County Borough Council on 18 July 2013 and Rhondda Cynon Taff on 13 October 2011. However, due to a change in the proposed site access route, the developer, Gamesa, successfully applied for variation of two conditions of the Neath Port Talbot permission by way of Section 73 consent. I stress that the variations dealt solely with the access route for turbine component deliveries to the site of the consented generating station itself, and its capacity will remain unaltered. As such, the impact on the DECC budget is neutral.

The variations were approved on 24 February 2016 by Neath Port Talbot County Borough Council. As I understand it, where an application under Section 73 is granted, the effect of the Planning Act 1990 is the issue of a new planning permission, with a new decision date, sitting alongside the original permission, which remains intact and unamended. The consent and conditions of the original consent are preserved, as is the implementation date by which the construction of the generating station should have been started. On Report in the House of Lords, the noble Lord, Lord Bourne, said:

“Where consent is granted for development on or before 18 June and is subsequently varied”,—[Official Report, 21/10/15; col. 668.]

in this way, it will continue to fall within the approved development condition.

While that is very welcome and positive for this project, regrettably, his statement by itself has proved insufficient to achieve adequate investor confidence. That is because the renewable obligation certificate is awarded after the wind farm has been built and has proven to be exporting electricity to the grid. Investors therefore need certainty before construction, otherwise there is a risk that the project could be built but not receive the required support. As a result, investors wish for certainty reflected in the legislation, and without the amendment the project will be put at risk. The amendment therefore aims to resolve the issue and ensure that the project can go ahead, matching government intent and delivering investment in the local community. My understanding is that without the amendment, such variation permissions as Section 73 would not qualify under the Government’s grace period condition.

The investors’ legal advisers have said that, as the Energy Bill currently stands, it fails to reflect the position that variation consents are fresh planning permissions as a matter of law, as used to be the case. They assert that without an amendment, such variation permissions would not qualify under the Government’s grace period condition. Amending the Bill would make it absolutely clear and avoid any additional funding being added other than what the Government have already allowed for.

In the particular case of Llynfi Afan Renewable Energy Park, tens of millions of pounds will be invested in the construction and operational phases. The communities have widely supported Gamesa’s Section 73 application, as they support the project and wish to see it happen. The local community stands to gain substantially in community benefits, and in terms of business rates and direct and indirect local employment opportunities. Gamesa is in the final stages of appointing a contractor who will be responsible for building the wind farm and, as such, will require employment and services from the locality. It has been Gamesa’s aim to work wherever possible with local companies, involving local jobs, and will continue to do so during the construction and operational phases.

I appeal to the Minister to agree to the amendment. If he finds some technical fault with it—although it is not obvious to me what that might be—will he agree to write a letter to the developers explaining why the Bill as it stands, without the amendment, meets their objectives and that they will be able to proceed, notwithstanding the fact that this amendment may not be accepted by the House?