Energy Powers (Wales)

Lord Barker of Battle Excerpts

Tuesday 6th September 2011 Westminster Hall

[The Minister of State, Department of Energy and Climate Change (Gregory Barker)]

It is a pleasure to serve under your chairmanship today, Mrs Main. I congratulate the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) on securing this important debate. I think I am going to disappoint him to a certain degree in not being able to agree with him on several matters of substance, but I am glad that we were able to start on a strong degree of consensus, by agreeing that scrapping the Infrastructure Planning Commission is important—not least to help him to deliver on his own manifesto commitments. He raised important issues to do with how major energy infrastructure projects in Wales should be determined in future. I congratulate him on the cogent and articulate way in which he did so.

I have 10 minutes to reply. I will write to the hon. Gentleman to make clearer any points that I am unable to cover in detail. He raised the Localism Bill, the abolition of the IPC, the referendum in May, inconsistencies between devolution settlements in Scotland and Wales, applications for consent under section 36 of the Electricity Act 1989, and recent discussions on devolution of major energy infrastructure. He also raised cross-party agreement in the National Assembly about devolution in Wales, several issues to do with technical advice note 8 strategic search areas, the impact on wind farm developments, particularly in his constituency and the wider area, and the different bodies making decisions on energy developments of different sizes in the same area; I agree that that can seem confusing, but we think that it has some strong underlying logic.

Overall, the Government’s policy on the area in question is clear: subject to the Localism Bill receiving Royal Assent, we believe that the right decision maker for major strategic energy infrastructure in England and Wales is the Secretary of State for Energy and Climate Change. We believe that a streamlined planning system that minimises delay and unpredictability and, importantly, ensures investor confidence, is best delivered through a unified strategic planning system for major energy projects in England and Wales. Some may argue that it is not appropriate for UK Ministers to make decisions on major infrastructure applications in Wales. We would strongly disagree. UK Ministers are as accountable to Welsh voters as they are to English voters and, in the absence of any compelling evidence to support a change, we vehemently believe that it is appropriate for UK Ministers to take those important decisions on major infrastructure of national significance.

A number of reasons have been set out to show why Welsh Ministers should make major energy infrastructure decisions, and I appreciate the points that the hon. Gentleman made, but the Government see no evidence for reconsidering our strongly held position. The coalition Government’s policy on the matter is exactly the same as that of the previous Labour Administration. It is important to consider the referendum on further Welsh devolution that was held on 3 March. There was a 63.5% vote in favour of the Assembly being able to legislate in a further 20 areas. I take this opportunity to wish the Assembly every success as it takes on that large tranche of new responsibilities. However, so soon after an important referendum on the scope of the Assembly’s powers, now is not the time to start to unpick things and revisit the question; it is not an appropriate moment to consider substantive changes to the devolution settlement as it affects energy consents. We need to leave the settlement as it is.

[Jonathan Edwards]

Does the hon. Gentleman recognise that his party fought the recent National Assembly elections, after the referendum, on the basis of increasing the threshold to 100 MW? Is he saying that those manifesto commitments were not worth the paper they were written on?

[Gregory Barker]

No. What I am saying is that the overarching decisions in the area are informed by the coalition agreement of the Government. That is the basis on which we make our important decisions, and we stand by those.

In Wales, the Holtham report suggested that Wales is underfunded, and recommended borrowing powers and devolution of some taxes. The Government have said that they will consider the Holtham report with the Welsh Government and, following the commitment in the coalition agreement, will establish a commission to consider funding and finance for Wales. The Secretary of State for Wales has announced the outline of that, and there will be further announcements to follow.

The Localism Bill is currently going through Parliament. The Bill would amend the Planning Act 2008, abolishing the Infrastructure Planning Commission and returning decisions to democratically elected and accountable Ministers. The Government believe that the Planning Act regime and the changes proposed in the Localism Bill need time to bed in to ensure that important matter of investor certainty. That is another reason why we do not believe we should take the hon. Gentleman’s suggestions forward. It is important to note that the impact of the abolition of the Infrastructure Planning Commission for Wales is minimal, and no different from the impact for England. The pre-application and examination procedures will remain the same and they will be handled by the Major Infrastructure Planning Unit, the IPC’s successor. However, final decisions will be made by Ministers accountable to Parliament.

It has been pointed out by the hon. Gentleman that the current planning system is confusing, as different authorities determine different-sized energy projects. That was an important part of his argument. We acknowledge that, for example, wind farms of different sizes in the same area are given consent by different bodies in both England and Wales: so a wind farm of 50 MW or less would be given consent by a local authority, while a neighbouring wind farm with a generating capacity over the 50 MW threshold would be determined by the Infrastructure Planning Commission, or, following its abolition, by Ministers at the Department of Energy and Climate Change. We believe that thresholds must be set somewhere, and that on balance those I have outlined are the right ones for the national interest. There is still significant scope for smaller projects to be determined by the local authority. Major energy infrastructure, given its national significance, should be determined at a national level.

On whether there is already enough planned energy infrastructure capacity, it is sometimes argued that there is enough in the pipeline. However, projects under construction or with planning consent would only replace the capacity lost through closures, which is currently expected to be about 22 GW. That does not take account of the need to move to low-carbon sources of generation, or of the need to increase the amount of capacity available to take account of the switching that we will need from fossil fuel to low- carbon electricity in domestic heating and transport. There is no guarantee that any given project will receive consent, or, having received it, will be built. When projects have been registered with the IPC those are not applications for consent; the companies have registered their interest in the application process. Projects in the pre-construction phase are not guaranteed to be built. The Department’s White Paper on market reform shows that up to £110 billion of investment in electricity generation and transmission is likely to be required within the next decade.

We also acknowledge that Welsh issues should be taken into careful consideration for major energy infrastructure applications within the Principality, and, of course, they already are. Currently, IPC commissioners with expertise in Welsh issues are appointed to panels for Welsh applications. It is very important that, following the abolition of the IPC, Welsh issues should continue to be considered in major infrastructure applications.

Options are still being considered for how the new unit will work within the Planning Inspectorate. Welsh Government officials are significantly involved in that integration work. The national planning statements require decision makers to take into account where appropriate the technical advice notes in Wales, which have been mentioned at length in the debate. So Welsh policy issues have significance and will be taken into account when an important planning decision is made. We certainly regard the views of local people as important. All major applications for energy infrastructure in Wales are dealt with on a case-by-case basis, after the views of local people have been taken into account. There are two opportunities for local people to have their say: first, when applications are being prepared for the submission to the IPC, the developer must consult widely with the local community; secondly, during the IPC’s examination of an application, any member of the public can submit evidence to the IPC.

The review of TAN8 is a matter for the Welsh Government. If there is a review, we shall take due account of its progress while considering individual applications in respect of which it is a material consideration, but we would not expect to suspend our consideration of applications while any review of TAN8 is being carried out, unless requested to do so by the developers concerned.

I am sorry that, because of limited time, I have not had the opportunity to reply at length to the questions posed by the hon. Gentleman but, as I said at the outset, I shall be happy to write to him on further specific points.