Planning and Infrastructure Bill (First sitting)

Michael Shanks Excerpts

Committee stage
Thursday 24th April 2025 Public Bill Committees

[Paul Holmes]

Just for the record, that is not my view. There are some concerns. I was not castigating you.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

Q Good afternoon. Thank you for joining us. As a Government we have set out the ambitious clean power by 2030 plan, which involves significant roll-out of renewables. Key to that will be storage and our ambition to build the first long-duration storage in 40 years in this country. I would like to ask Beatrice and Ofgem, what is your sense of the importance of the mechanisms for doing that, particularly the cap and floor financing scheme; and how important is long-duration storage to the energy mix we are trying to build?

Beatrice Filkin: As you said yourself, Minister, we have not seen any large scale, long-duration energy storage built in this country for decades now. We know that the market is not willing to take on those risks at the moment and it is absolutely right that the Government are instructing us through this Bill to expand the regimes and protections.

We support the proposed introduction of a cap and floor regime for long-duration storage. We have seen NESO’s advice to you as part of the development of the Clean Power 2030 Action Plan—that increasing the amount of flexible storage on the system is critical to getting through your clean power targets. We are very keen to be part of supporting that. We think the cap and floor regime has proved its worth over the last decade or so through interconnectors, and obviously, we are adjusting it now with input from a wide range of stakeholders to make it appropriate for the long-duration storage schemes.

[Michael Shanks]

Q Christianna, this Bill has a significant amount of planning reform in England and Wales, but the key element in the energy space in chapter 2 is around the reforms to Scottish consenting. We have worked very closely with the Scottish Government to update the Electricity Act 1989. Can you give any sort of sense, from your extensive experience in this in Scotland, of how much those changes are necessary, or perhaps how much of the development is being held back by that planning reform not being updated at the moment?

Christianna Logan: We really welcome the powers in the Bill that create that framework to increase the timeliness and effectiveness of consenting in Scotland, particularly around introducing timescales for determinations and replacing automatic trigger of public local inquiries with a reporter-led process.

Public inquiries are one of the main causes of delay to consent decisions in Scotland, with the impact and cost of that borne ultimately by bill payers and local communities through local authority investment. We believe that to make the powers in this Bill effective in practice, the secondary legislation will be critical. We ask that the secondary legislation providing the details of implementation is delivered in parallel with the Bill, so that it can be laid as soon as decisions are made, and that within determination, timelines are set at 12 months to make sure that we can get timely delivery.

We welcome all the joint working between this Government and the Scottish Government, and we would like to see that continue for that secondary legislation. We welcome the Scottish Government's commitment to a 12-month determination for projects, but we are not yet seeing that in practice. For example, our Sky project, which is both an energy security and decarbonisation project, is still awaiting determination more than two and a half years on. That is why the ask is so important.

[Michael Shanks]

Finally, Dhara, picking up on the questions on connections reform and the wider push in the Bill on how we build network infrastructure more quickly and the ambition of that, how critical is it to the broader energy space—particularly on the questions of energy security, bringing down bills and the wider space on our energy mix going forward—that we build more network infrastructure and get the grid working? How critical is that aspect to delivering in the 2020s, and in the 2030s in particular, to meet the demand that we are going to see, and the Government’s other objective of bringing down bills?

Dhara Vyas: That is absolutely the right question to be asking, because we will not achieve any of it unless we unblock the issues we are seeing within the infrastructure space. The reality is that with these so-called zombie projects, at least half of them are ready to move on to the next stage. In large part, that is down to the work that has been happening as part of the connections reform project. It is really important that we keep on moving with the momentum we have right now, because gaining planning permission and making progress through the new milestones that the National Energy System Operator has set out is the next big challenge for us.

We are in a really difficult position right now. Bills and debt owed by customers to energy suppliers are at a record high. We are still really feeling and living in the long shadow of the cost of living crisis, which was partly down to the energy security crisis following the illegal invasion of Ukraine. Investing in an abundance of clean power will be completely pointless unless we have the infrastructure to move it around the country, and unless we invest in clean power, we will not ultimately bring down bills to the extent that we need to. The other part of that is demand. We will see demand increase by at least sixfold. We are going to have electrification of our homes and our transport, which brings us back full circle to the need to be able to move the electricity around.

[John Grady]

Q I have a question for Christianna, Beatrice and Charlotte. To bring this to life, I am a Scottish MP, so if I am building a set of offshore wind farms in the north of Scotland, I also need to build transmission infrastructure from Scotland down to England. The holdouts of this involve connection queues, planning delays in Scotland and planning delays in England. The Bill, with the reforms in England and Scotland, seeks to reduce those delays. I want to unpick what that means for my constituents in terms of jobs and investment. How much money will be invested in the grid in Scotland over the next five to 10 years, because this Bill helps speed that investment up?

Christianna Logan: Our programme of projects to deliver for 2030 is a £22 billion investment. It is the biggest investment that we have seen in the north of Scotland probably since the second world war, so it is really significantyou’re your constituents. Our colleagues in ScottishPower have their investments in your area as well. Alongside that, there is a significant number of jobs—we expect around 6,000 jobs enabled through our investments in Scotland specifically. Just this year, we will be recruiting another 600 people into SSEN transmission to help with this transformation of our grid network.

All of that, as you say, is dependent on us getting consent to progress all these projects and the necessary regulatory approvals for the investments. We have been working very closely with Government and Ofgem on the reforms, and we believe that the proposals put forward in the Bill will take us forward in that regard. As I said earlier, the secondary legislation and the work with the Scottish Government will be critical to capturing those benefits.

Planning and Infrastructure Bill (Fourth sitting)

Michael Shanks Excerpts

Committee stage
Tuesday 29th April 2025 Public Bill Committees

[Matthew Pennycook]

I thank the shadow Minister, the hon. Member for Hamble Valley, for his constructive tone on this clause—and others; I do not mean to confine his constructive attitude to just this clause. I welcome his praise for Lord Banner’s review, which I agree was thoughtful and insightful. As part of that review Lord Banner made it clear that although the duration differs between different applications, each attempt to apply for a judicial review currently extends the duration of a claim by, on average, several weeks, and in some cases by several months. In large numbers of cases, time is added by legal challenges that are unsuccessful. The changes made by the Bill aim to strike the right balance between improving efficiency and ensuring access to justice.

To be clear, this clause does remove the paper permission stage, but only makes changes by removing the right to appeal for cases that are deemed “totally without merit”. Other cases will retain that right of appeal if they are deemed to be with merit and able to be considered. We think these changes will make a difference to the time that projects take to work their way through the system, and we will work with the judiciary to advance a number of other changes to the process for NSIP judicial reviews, such as introducing target timescales for cases that we think will have a beneficial impact. On that basis, I commend the clause to the Committee.

Clause 9

Connections to electricity network: licence and other modifications

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

I beg to move amendment 36, in clause 9, page 14, line 6, after “distribution system” insert

“(and such an improvement may include changing the order in which connections are made)”.

This amendment clarifies that the purpose for which the power under clause 9(1) may be exercised may include the making of changes to the order of the queue for connections to a transmission or distribution system.

[The Chair]

With this it will be convenient to discuss the following:

Government amendments 37 to 40.

Clause stand part.

Clauses 10 and 11 stand part.

New clause 19—Increasing grid capacity—

The Secretary of State must, within three months of the passing of this Act, lay before Parliament a plan to—

(a) reduce the cost of, and time taken to make, connections to the transmission or distribution system;

(b) permit local energy grids.

This new clause would require the Secretary of State to produce a plan to reduce the time and financial cost of connections to the electricity grid and to allow local energy grids.

--- Later in debate ---

[Michael Shanks]

It is a pleasure to serve under you, Mr Twigg. We thought a change in the tone of the Committee for a few clauses would be helpful, before we return to the other Minister.

Amendment 36 clarifies that a modification made under clause 9 may include changes to the order of the queue for connections, which works towards the broader aim of improving the management of connections to the transmission and distribution systems. The purpose of all this work is to reorder the connections queue. That is essential to deal with the extreme level of oversubscription in the queue, and enable a move from the “first come, first served” proposition that we have at the moment to a “first ready and needed, first connected” approach. The amendment is essential to fulfil the intent of the clauses, which is to provide the means to implement connections reform should the current Ofgem and industry-led process face delays or be unable to realise its benefits in full.

Amendment 37 clarifies that the power of the Secretary of State to direct Ofgem to modify a licence or agreement may be exercised only for the purpose of improving the management of connections to the transmission or distribution system, which places an additional safeguard on the use of that power. Amendment 38 clarifies that the Secretary of State or Ofgem may modify an agreement under the powers in clause 9 even where the effect of the modification might amount to a repudiation of the agreement, which provides consistency with the existing wording in clause 12. It is also essential to fulfil the intent of the clauses. Finally, amendments 39 and 40, which are purely consequential on amendment 38, move the definition of “qualifying distribution agreement” within clause 9.

I turn to clause 9 more broadly. As many Members will know, the current first come, first served electricity grid connections regime is causing considerable and unacceptable delays. It is blocking clean power projects from connecting to the grid, and blocking demand projects that are critical to our economic growth as a country. The National Energy System Operator—NESO—and Ofgem are reforming the electricity grid connections process to a strategically aligned first ready, first connected system. The reformed process will require projects to meet readiness, technological and locational criteria to progress.

The reform requires complex amendments to codes and licences. Clause 9 therefore enables the Secretary of State or Ofgem to support the existing connections reforms by directly amending electricity licences, and associated documents or agreements, should that prove necessary. It is intended to be used should the existing processes enacting connections reforms face significant delays, including alignment with strategic energy plans. The Government or Ofgem will then be able to expedite a set of changes outside the standard process to ensure that our clean power mission is delivered at pace. The clause is focused on improving the management of connections to the transmission or distribution system, and follows precedent in being time-limited to three years after commencement of the power on Royal Assent. Similar powers have been taken in the past, including in section 84 of the Energy Act 2008, but they were also time-limited and are therefore no longer in force.

Clause 10 details the scope of the power in clause 9, which enables the Secretary of State or Ofgem to make amendments to electricity licences and associated documents or agreements. The clause first defines the power to modify in clause 9, which includes the ability to amend, add to or remove provisions, and to add or release parties from agreements. It will enable the Secretary of State or Ofgem to support Ofgem and NESO’s existing connections reforms by directly amending electricity licences, and associated documents or agreements, should that prove necessary.

The clause further details how the Secretary of State or Ofgem can exercise the power, which includes allowing for general or specific modifications, incidental changes and provisions that do not necessarily relate to the activities authorised by the licence. It ensures that modifications to standard licence conditions are reflected in future licences, and specifies the conditions under which licences can be revoked. Finally, it allows agreements to include conditions that must be met before the taking of specific steps, or provision about the procedure for varying the agreement. Similar scope and procedure have been outlined previously in legislation, including in the Nuclear Energy (Financing) Act 2022.

Clause 11 details the procedure around the provision in clause 9 to enable the Secretary of State or Ofgem to make amendments to electricity licences and associated documents. It aligns with the precedent established in section 8 of the 2022 Act, which detailed the procedure to modify a generation licence of a relevant licensee nuclear company. The clause obligates the Secretary of State or Ofgem—I am not sure how many more times I will say that in this speech—to consult a list of specified persons, such as the holder of any relevant licences, NESO and any other appropriate individuals, before making modifications. Details of those modifications must be made public as soon as reasonably practicable to ensure transparency with wider stakeholders. However, the Secretary of State or Ofgem can exclude from the publication any information that could harm commercial interests.

I will respond on new clause 19 after it has been spoken to.

--- Later in debate ---

[Paul Holmes]

What I have to say about these clauses will not be arduous, partly because I am not a shadow Energy Minister—as many Members will be pleased to note, including me—and my focus will be on the planning amendments. This is, however, a very important part of the Bill.

The Minister said he keeps mentioning “Ofgem and the Secretary of State”, but if he would like us to helpfully have a word with the Prime Minister to recommend that he becomes the Secretary of State, we are more than happy to do so. The Opposition believe that even he, as the Under-Secretary, could not do as much damage to our energy system networks and future growth as the Secretary of State, the right hon. Member for Doncaster North (Ed Miliband). [Interruption.] It is a policy disagreement.

This is a policy disagreement because, looking at the proposals in these clauses, we are very concerned. We obviously agree that the grid needs to be ready to connect to, because of the demands being placed on the system, and that is the policy of this Government and of the last. However, the focus of the current Secretary of State in really going down the route of the net zero agenda at what we would describe as a very fast speed, sometimes cutting off his nose to spite his face such as by cutting back on some of the energy systems we currently have, has put overwhelming demand on the energy grid.

The Government’s proposed decarbonising of the grid by 2030 will add at least £25 billion per year to the cost of the electricity system. The brunt of this increase will be felt by the people out there, who will see their household energy bill shoot up by over £900. Professor Gordon Hughes, the leading energy system expert, has found that these plans will increase power generation costs, grid balancing and capacity levels, thereby passing on those costs to our constituents.

The costs of balancing the grid alone are set to rise by £4 billion. Despite that, the Government have scrapped the full system cost review commissioned by the last Government. The current Administration are steaming ahead without a clear understanding of the impact on the energy bills of hard-working people—the energy bills they promised to freeze—on their families and on the industry’s competitiveness. Decarbonising the grid requires transparency on costs, not just soundbites about renewables, which I believe is what we have seen.

The Government have also watered down the proposed community benefits of new energy infrastructure, which they lauded before the press a couple of weeks ago, to just £750 per person.

[Michael Shanks]

Just!

[Paul Holmes]

From a sedentary position, the Minister says, “Just”, under his breath. It was not me who went to the BBC and leaked a report saying that the Government were going to give more money than they are now proposing; that has been reduced by his amendment, so, yes—“just”.

Furthermore, the Government have abandoned a number of reforms, including a review of the presumption in favour of overhead lines, stronger protection for prime agricultural land against large solar developments, and enhanced safety measures for battery storage facilities. Expanding and improving the electricity system is necessary, but it must be done in a way that balances affordability, reliability and community concerns. We are concerned that the clauses in the Bill remove this transparency and add costs, but will not deliver the streamlined or more rapid benefits to the system that the Minister outlined.

[Olly Glover (Didcot and Wantage) (LD)]

It is a pleasure to serve under your chairship, Mr Twigg. I rise to speak to new clause 19. First, the Liberal Democrat members of this Committee support a lot of what the Government are proposing in this part of the Bill. Creating electricity grids of the future is a critical route to decarbonising and has the potential to reduce consumer bills.

It is much to the UK’s credit that we are making good progress in efforts to decarbonise our electricity generation. Wind and solar in particular account for a growing share of our power generation. However, the transition from one-way transmission of electricity from a small number of very large power stations to a more distributed and multi-directional movement of power creates some challenges. We are going to need major upgrades of our electricity grid to accommodate the growing number of solar installations, as an example, more of which my hon. Friends and I would like to see on new and existing buildings. Making further progress will help our national energy security and reduce consumer bills at a time when energy inflation and the cost of living are still significant problems.

There are examples where cost and/or process have acted as barriers to the ability to feed surplus solar energy into the grid, or to the commissioning of new clean and renewable electricity production. Local energy grids have the potential to benefit communities and use the energy much closer to its source of generation. Therefore our proposed new clause would go further than the Government in the current Bill. It requires the Secretary of State to, within three months of the passing of this Bill, lay before Parliament a plan for how the Government will facilitate the creation of local energy grids and deal with the cost and time of grid connections. I hope the Minister and hon. Members on the Government Benches will embrace this amendment as a way to help continue our country’s journey towards becoming a clean, renewable energy superpower.

[Michael Shanks]

I will first respond to a few points in the debate generally. My hon. Friend the Member for Glasgow East—across the Clyde from my constituency—made the absolutely right point that sums up what this connections reform process is all about: the absence of reforming the queue is driving away investment. Reform is critical for investment in our generation capacity and for how we connect demand projects that will be so important for unlocking economic growth. With more than 750 gigawatts currently in the queue to connect in the UK, the truth is there is no scope for that to happen without some radical reform of the queue. The Conservative party, when in government, recognised that that was a challenge and had already set about some reforms to make that happen.

We think we need to go even further. The shadow Minister, in a ray of honesty, said he was glad he was not the shadow Energy Minister. Based on the script on net zero, I think we are all fortunate that he is not the shadow Energy Minister, frankly, but it is the same script we are hearing from everyone at the moment.

[Luke Murphy (Basingstoke) (Lab)]

It is a pleasure to serve under your chairship, Mr Twigg. Might it not be that the hon. Member for Hamble Valley is embarrassed by his party on net zero? After all, on 17 January he said:

“I will conclude—many will be pleased to hear—by reaffirming the Conservative party’s strong commitment to the UK’s target of reaching net zero by 2050”—[Official Report, 17 January 2025; Vol. 760, c. 650.]—

only for that to be scrapped by his leader exactly two months later.

[Michael Shanks]

There is always a quote, as they say, and my hon. Friend is always there with the quotes at his fingertips, which is helpful. The truth is that the only way we are going to bring down bills and deliver energy security is the sprint to clean power. This is a crucial element of that, and of how we unlock investment—predominantly private investment—over the next few years as we build that clean power system. Even if we were not doing that, the grid is essential. It is an essential part of how we deliver electricity to homes, businesses and industry and it is critical that we upgrade it anyway.

[Lewis Cocking (Broxbourne) (Con)]

The Minister talks about energy security and bringing down bills, and of course we need to have more renewables online to do that, but we also need to issue new oil and gas licences so that we can produce more energy at home. That would help with what he is suggesting.

[Michael Shanks]

We are straying far from new clause 19, which I am keen to return to, but the hon. Gentleman is simply wrong on that point. Gas traded on the international market is exactly why all our constituents pay more on their energy bills. The answer is to get off gas as the marginal price setter, not to have even more of it.

The hon. Member for Taunton and Wellington made a helpful speech, although I will resist his new clause. We are in agreement about the issue of connection delays and the first come, first served process not working, and it is important that we reform that. We are of the view that our proposals do that, and the National Energy System Operator has worked with Ofgem and is of the view they are sufficient to do that.

The question of local power and local grids is an interesting approach that we are looking at. We take seriously the role of community-owned power—it is in the Great British Energy Bill, recognising our commitment to it—but we do not see it in itself as a barrier to what we are trying to do here. The infrastructure, including for local networks, that incorporates generation and demand is already permitted under the existing system. It can be constructed and operated by distribution network operators, by independent network operators or by a private wire under a statutory licence exemption provision.

We agree about the importance of community energy and are looking at a range of things, in particular at how communities might to sell power locally. They are all important points, and all this is how we will unlock the social and economic benefits of the clean power transition. For the reasons I have outlined, and because we think it is already entirely possible, we will resist new clause 19.

[Gideon Amos]

People in Taunton and Wellington are four-square behind new clause 19, but it was my hon. Friend the Member for Didcot and Wantage who spoke to it.

[Michael Shanks]

I betray my lack of English geography. I am sorry, but I assume that the hon. Members for Taunton and Wellington and for Didcot and Wantage are both in complete agreement with new clause 19. In any event, I thank them, but disagree with them both, instead of just one of them. I commend Government amendments 36 to 40 and clauses 9 to 11 to the Committee.

Amendment 36 agreed to.

Amendments made: 37, in clause 9, page 14, line 8, at end insert—

“(3A) The Secretary of State may exercise the power under subsection (3) only for the purpose mentioned in subsection (2).”

The amendment makes it clear that the power of the Secretary of State to direct the GEMA to modify a licence or agreement may only be exercised for the purpose of improving the purpose of managing connections to the transmission or distribution system.

Amendment 38, in clause 9, page 14, line 15, at end insert—

“(5A) A relevant authority may under subsection (1) modify an agreement mentioned in subsection (1)(e) or a qualifying distribution agreement even if the effect of the modification might amount to a repudiation of the agreement.”

This amendment ensures consistency with clause 12(8) in clarifying that modifications made to a particular connection or distribution agreement under clause 9(1) may be made even if the effect of the modification might amount to the repudiation of that agreement.

Amendment 39, in clause 9, page 14, line 16, leave out subsection (6).

This amendment, together with amendment 40 moves the definition of “qualifying distribution agreement” into subsection (7); this change is consequential on amendment 38.

Amendment 40, in clause 9, page 14, line 27, at end insert—

“‘qualifying distribution agreement’ means—

(a) the terms subject to which a connection is made by an electricity distributor in pursuance of section 16(1) of the Electricity Act 1989, or

(b) a special connection agreement as defined by section 22(1) of that Act;”.—(Michael Shanks.)

See the explanatory statement for amendment 39.

Clause 9, as amended, ordered to stand part of the Bill.

Clauses 10 and 11 ordered to stand part of the Bill.

Clause 12

Directions to modify connection agreements

[Michael Shanks]

I beg to move amendment 41, in clause 12, page 16, line 8, leave out subsection (1).

The effect of this amendment is that a relevant authority may give a direction under clause 12 without first having exercised its powers under clause 9(1) to modify an electricity licence or an electricity industry code.

[The Chair]

With this it will be convenient to discuss the following:

Government amendments 42 to 47.

Clause stand part.

[Michael Shanks]

Government amendment 41 will allow the Secretary of State or Ofgem to direct the NESO or a distribution network operator to amend an agreement under the clause without the need to have previously modified licences, codes and associated documents under clause 9. Without the amendment, the Secretary of State would not be able to use the power to direct the National Energy System Operator or a DNO had not the modification powers in clause 9 —to make changes to licences, codes and associated documents—also been exercised. The amendment will mean that the directive power in clause 12 is no longer contingent on the use of the powers in clause 9.

An example of where the amendment would be needed is if an Ofgem and NESO-led process to amend licences and codes under the framework is successful, meaning that the powers in clause 9 do not need to be used, but the NESO or DNO has not accordingly amended its agreements with customers connecting to the electricity network. The directive powers could be used to ensure that the implementation of connections reform is successful.

--- Later in debate ---

[David Simmonds]

I have a couple of questions. As my hon. Friend the Member for Hamble Valley has set out, we are broadly supportive of the direction of travel around energy in the Bill.

One of the things we are all conscious of with the move to renewables being the main source of power in the grid—something that the UK has achieved faster than most other countries, with a bigger drop compared with the 1990 baseline than any other developed economy —is that it makes the grid more complex. Unlike oil, gas and nuclear, which can be delivered in an entirely predictable manner, renewables are generally much less predictable. There are times when the wind does not blow and the sun does not shine, and we cannot therefore put that element into the grid. We need to find alternative methods so we need to be able to shift greater amounts of power around to meet the growing energy needs.

As the Minister has outlined, the regime that is envisaged will, for a limited period of time, give greater powers to the Government to determine who gets connected and in which order. First, will the Minister set out how he and the Government intend to feed back to Parliament what we learn from that process, to inform the future shape of our energy grid?

Secondly, what recourse will there be for those at a certain point in the queue who anticipate that their development, whatever it may be, will be served by a particular project and connected at a particular point, if the Government decide otherwise because the reordering of the queue is, in the Minister’s view, necessary? We all understand why that may happen, but if someone is about to invest in a major new carbon capture and storage facility—the sort of major infrastructure project that the Bill is designed to support—and they expect it to be powered by a wind farm but are then told they have been moved much further down the queue than they expected, that will affect the delivery of that project. It would be helpful to understand the process whereby those affected by the reordering of the queue are able to challenge the decision, if necessary, and certainly to engage with the Government, or with constituency MPs, who may seek to advocate for them, so that the reordering can be revisited if necessary.

[Michael Shanks]

I thank the hon. Gentleman for those helpful questions. He rightly set out the fact that the grid is already considerably more complex than it was 20 or 30 years ago, and it will become more complex, which is partly why the reform of connections is so important.

The hon. Gentleman is right to say that the process of prioritising projects will mean that some will be deprioritised. We have looked at the projects that already have a connection date, and in many cases they will proceed. Viable generation projects above the capacity ranges outlined in the clean power action plan—the first strategic document that will be used to guide projects—might still be able to connect if there is capacity in that particular bit of the DNO after the prioritised projects have been assessed. If there is no space in the pre-2030 queue, they will be offered dates in the 2031-35 process.

We have been clear throughout that the process has not been arbitrary or theoretical. Ofgem and NESO have gone through individual applications that are currently in the process to make sure not only that they fit with the requirements of the clean power action plan but that projects are not unnecessarily disadvantaged. Some projects will go ahead even though they are not in the strategic plan, because where they already are in the grid will make it possible for them to go ahead.

The question of transparency is really important. I will come back to the Committee with details on how we might make the information public, but throughout the process Ofgem and NESO have made public as much information as possible about how they have gone about things, and there was a full public consultation as well. The point about how individual MPs can see whether projects in their constituency are affected is well made and I will take that away and reflect on it.

The critical fact, as the previous Government rightly recognised, is that 750-plus GW is simply unmanageable. Really good projects are sitting with dates long into the future but cannot connect because of what are often phantom projects that are never going to come to fruition and are holding up spaces in the queue. For all the reasons that the hon. Gentleman outlined in terms of the importance of energy security, and the importance of prioritising the queue, we think that the Government amendments and the clause are essential.

Amendment 41 agreed to.

Amendments made: 42, in clause 12, page 16, line 17, leave out

“as mentioned in subsection (1)(c)”

and insert

“in accordance with the conditions of an electricity licence”.

This amendment is consequential on amendment 41.

Amendment 43, in clause 12, page 16, line 22, after “distribution system” insert

“(and such an improvement may include changing the order in which connections are made)”.

This amendment clarifies that the purpose for which a direction may be given under clause 12 may include the making of changes to the order of the queue for connections to a transmission or distribution system.

Amendment 44, in clause 12, page 16, line 23, leave out subsections (4) and (5) and insert—

“( ) A direction under subsection (2) must describe the kinds of modification to be made by the person to whom it is given.”

This amendment inserts a new subsection which would mean that a direction made by the Secretary of State or the GEMA to the ISOP or an electricity distributor to modify an agreement must describe the kinds of modification required.

Amendment 45, in clause 12, page 16, line 38, at end insert—

“(7A) Before giving a direction under subsection (2), the relevant authority must consult—

(a) the person to whom it proposes to give the direction, and

(b) such other persons as the relevant authority considers appropriate.

(7B) Subsection (7A) may be satisfied by consultation carried out before the passing of this Act (as well as by consultation carried out after that time).

(7C) A relevant authority must publish details of any direction it gives under subsection (2) as soon as reasonably practicable after the direction is given.

(7D) A relevant authority may exclude from publication under subsection (7C) any information the publication of which would be likely to prejudice the commercial interests of any person.”

This amendment requires a relevant authority to carry out consultation before giving a direction under clause 12. It also requires a relevant authority to publish any direction it gives under the clause.

Amendment 46, in clause 12, page 16, line 41, at end insert—

“(8A) The power to give a direction under subsection (2) may not be exercised after the end of the period of three years beginning with the day on which this section comes into force.”

This amendment ensures that the power to give a direction under clause 12 is time-limited in the same way as the power to make modifications to licences and other documents under clause 9.

Amendment 47, in clause 12, page 17, line 10, at end insert—

“(11) In Schedule 6A to the Electricity Act 1989 (provisions imposing obligations enforceable as relevant requirements)—

(a) in paragraph 4A (electricity system operator), after sub-paragraph (c) insert—

‘(d) section 12(8) of the Planning and Infrastructure Act 2025 (duty to comply with direction under section 12 of that Act).’;

(b) in paragraph 5 (distribution licence holders), after sub-paragraph (g) insert—

‘(h) section 12(8) of the Planning and Infrastructure Act 2025 (duty to comply with direction under section 12 of that Act).’”—(Michael Shanks.)

This amendment amends Schedule 6A to the Electricity Act 1989 in order to provide for enforcement of the duty to comply with a direction given under clause 12.

Clause 12, as amended, ordered to stand part of the Bill.

Clause 13

Managing connections to the network: strategic plans etc

Question proposed, That the clause stand part of the Bill.

[Michael Shanks]

Clause 13 will require NESO and the DNOs to have regard to strategic plans designated by the Secretary of State when they carry out functions related to connections. The Secretary of State will designate one or more strategic plans, with the current intention that this will include the clean power 2030 action plan in the first instance and the strategic spatial energy plan going forward. There is precedent in imposing a duty on a body to have regard to a strategic document—for example, the designated strategy and policy statement under section 165 of the Energy Act 2023, which outlines the Government’s strategic priorities, policy outcomes, and the roles and responsibilities of those involved in implementing energy policy.

Let me turn to the detail of the objects set out in the clause. It amends part 5 of the Energy Act 2023 to include a duty for NESO to have regard to designated strategic plans. It also amends the Electricity Act 1989 to place a duty on DNOs to have regard to any designated strategic plan, and adds a further exception to the duty on DNOs to connect in cases where it would not be in accordance with the designated strategic plans. The clause will support the implementation of ongoing connections reforms led by NESO and Ofgem, and will provide guidance and support for NESO and DNOs in making decisions on issuing new connection offers. I commend the clause to the Committee.

[Paul Holmes]

The Minister has been clear in outlining how the clause relates to the previous clauses, and how he wants to overwhelmingly reform the electricity system. I do not see the clause as particularly controversial; it moves on from what he has previously described. Despite my previous speech—I have nothing against the Minister—the Opposition obviously want to be constructive where we possibly can be. The clause is simple and enables the process to carry on, and we will not contest it.

--- Later in debate ---

We have tabled the amendment to make sure that residents get that benefit, and to make sure that when fees come in, they are not kept by Scottish Ministers but are redistributed to local planning authorities, so that decisions can be made in a more streamlined, quicker way. That is what this Bill, and particularly this clause, could do for people living within those communities.

[Michael Shanks]

Normally, the hon. Member for West Aberdeenshire and Kincardine is my sparring partner in both the Scotland and energy spaces, so it is nice that he has made an appearance in this debate, but I disagree with his amendment. The main reason is that it concerns a devolved competence. This is a UK Government Bill and it is right, given that the resource of local planning decisions and planning authorities is devolved to Scottish Ministers, that they make the decision on how they resource statutory consultees and local planning authorities.

On the point about community benefits, the Scottish Government already have an established process. The 10-year onshore wind ban in England was not in place in Scotland, and the process of good practice for community benefits for onshore wind, for example, is already quite well developed. Processes are in place. Over the past 12 months, developers have offered more than £30 million in community benefits.

We are, of course, exploring all options and the Bill includes bill discounts for network infrastructure—we will come to that shortly—but we are open to much more on community benefits generally, because we agree that if communities are hosting nationally important infrastructure, they should benefit, as the hon. Member for Hamble Valley rightly said. However, for the reasons I have outlined—this is a devolved competence and not a matter for me as a UK Government Minister—we hope the hon. Gentleman will withdraw the amendment.

[Paul Holmes]

I completely understand where the Minister is coming from. He does not want to tread on the toes of devolved Administrations. I thought he might be more encouraged to do so, considering that the Scottish Government are run by the Scottish National party, which is not doing a very good job at the moment. However, I also understand that he may not want to give them any more money to screw up the job that they are doing.

[Michael Shanks]

I agree.

[Paul Holmes]

Good—we have some consensus across the Committee. However, the Minister should not be fearful about giving those Ministers greater powers in this respect. We are trying to enable a greater amount of money to be devolved to the local authorities that are going to be directly responsible for ensuring community benefits from community infrastructure for the people who elect them. The Minister has said throughout our discussions that it is important to be transparent and to be able to resource some of the radical reform he is making. He should not be fearful—

[Michael Shanks]

I do not disagree with a single thing that the hon. Gentleman has just said, but it is not for me to dictate to the Scottish Government. They are democratically elected, and as much as I may disagree with much of what they do, they are none the less the Government of Scotland, and if they want to ringfence funding for a particular part of the process, they should be able to do so. In particular, diverting any funding away from the more speedy processing of planning applications would not be in the interests of the projects we want taken forwards. It is not that I disagree with him, but this is a devolved competence.

[Paul Holmes]

I thank the Minister for that, and I agree with him that it is a devolved competence—that is a fact—but he could be giving Scottish Ministers and constituents in Scotland a present by allowing the Government to make those decisions.

It is not just that the Government could be taking money from Scottish Ministers and giving it to local authorities under proposed new subsection (4)(a), but there is scope in the amendment for Scottish Ministers—the devolved Ministers—to be given the power to allocate consumer benefits packages where they think fit. That is strengthening the hand of devolved Ministers, not taking anything away from them. [Interruption.] The Minister says, “It doesn’t stop them.” No, but this would strengthen their hand. I think that giving devolved Ministers the power to give consumer benefits packages to Scottish people who are affected by infrastructure is a good thing.

I am not the intellectual powerhouse of the House of Commons, but even I can calculate that we would not win if we pushed this to a vote, so I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Paul Holmes]

I beg to move amendment 84, in clause 14, page 18, line 36, at end insert—

“Consultation requirements (Scotland)

1B (1) Where an application is made to the Scottish Ministers for consent under section 36 or 37, the Scottish Ministers must provide for the holding of a public consultation.

(2) The Scottish Ministers may by regulations make provision about the holding of consultations.

(3) Regulations may include—

(a) the length of consultation periods in urban and rural areas;

(b) requirements on applicants to publish the projected local economic benefits and other specified information in advance of a consultation;

(c) requirements on applicants to respond to or demonstrate consideration of submissions to consultations.”

The amendment stands in the name of my hon. Friend for—

[Michael Shanks]

Gordon and Buchan.

[Paul Holmes]

The amendment stands in the name of my hon. Friend the Member for Gordon and Buchan (Harriet Cross). Just as the Minister is not an expert on the south coast, I am not an expert on Scottish constituencies, particularly as they all changed their names at the last boundary review.

This simple amendment would introduce additional consultation requirements. It is in a similar vein to amendment 81, which, with your permission, Mr Twigg, I intend to move later. It would enable community and public consultations when an application goes forward. As I said in the last debate, I do not think it is unreasonable that, when an application is put forward, members of the public should have a public consultation to hear about the perceived benefits and to challenge the organisations trying to bring forward infrastructure projects. We must also accept that consultations can take effect in a number of ways, based on whether the infrastructure is being built in rural or urban areas.

This is a simple amendment that seeks to make sure that, when an application goes forward, Scottish Ministers have the powers that the Minister has outlined to ensure there is a public consultation, so that the people on the ground who are genuinely affected by such infrastructure projects have a say and see the transparency that we hope the Bill will put in place.

[Michael Shanks]

Amendment 84, tabled by the hon. Member for Gordon and Buchan (Harriet Cross), concerns public consultations under sections 36 and 37 of the Electricity Act 1989. It is worth making it clear that the planning systems of Scotland and of England and Wales are very different, and the starting points are very different.

The 1989 Act—which we will come to shortly, in relation to the necessary updates to consents more widely—provides for the process of notification and objection at the application stage. This is very different from aspects of the planning regulations in England and Wales, in that there are already opportunities for consultations, but clause 14 creates a further power to make regulations to set out such matters relating to applications for consent, including a pre-application consultation requirement. That requirement will be set out in regulations rather than in primary legislation, but its purpose is to ensure that the application is proportionate, adaptable and future-proofed.

As much as I politically disagree with the incumbent Scottish Government, we have been working together incredibly effectively, since we came into government, on some key aspects. The reforms of the 1989 Act are a good example. To take the earlier point about the changing energy system, that Act was legislation for a different time, and the planning system in Scotland has not kept pace with the reforms in the rest of the United Kingdom. The reforms that we are proposing give Scottish Ministers a framework to introduce regulations to allow for a pre-application consultation process, and to give both communities and statutory consultees meaningful opportunities to influence applications and have a voice early in the process. For that reason, I see much of amendment 84 as replicating provisions already in the Bills, so I hope the hon. Member for Hamble Valley will withdraw it.

[Paul Holmes]

I thought the Minister would recommend that I withdraw the amendment. I will put on the record that I am delighted that the Minister believes in pre-application consultation, because in one breath this morning—

[Michael Shanks]

In a very different system.

[Paul Holmes]

The Minister has had his say. All I am saying, politely, is that in a different provision of the Bill, the Government have completely removed pre-application consultation for nationally significant projects, yet the Under-Secretary of State for Energy Security and Net Zero believes in them. He does not want to accept our amendment to ensure transparent public consultation because pre-application consultation is strong enough already, and the public will be able to have their concerns looked at. The Minister says that they are different systems, but the principles are exactly the same. Ministers cannot rely on that argument for this amendment but not accept the same argument for amendments considered by the Committee earlier. However, as a realist, I know that this will not go very far. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Paul Holmes]

I beg to move amendment 81, in clause 14, page 19, line 9, leave out from “application,” to end of line 12 and insert—

“(b) consider the objection and the reporter’s final report,

(c) hold a public hearing, and

(d) allow a period of one month to elapse

before determining whether to give their consent.”

This amendment would require the Scottish Ministers to hold a public hearing and allow one month to elapse before determining whether to give consent to an application for new generating stations or overhead lines under sections 36 or 37 of the Electricity Act 1989.

The amendment is in the name of the shadow Scottish Secretary and acting shadow Energy Secretary, my hon. Friend the Member for West Aberdeenshire and Kincardine, who I know the Minister would be delighted to hear from—[Interruption.] I heard the “boo”. Amendment 81 is similar to amendment 84 but more specific. I suspect that the Minister will come back with the same argument, so I will take only a short time on this. The amendment would require Scottish Ministers to hold a public hearing, and allow one month to elapse before determining whether to give consent to an application for new generating stations or overhead lines under sections 36 or 37 of the Electricity Act 1989.

Put simply, that would allow local residents the right to provide feedback on proposed infrastructure. I am sure that hon. Members from both sides of the House will agree that it is right that people can have their voices listened to by Scottish Ministers and the Scottish Government. The amendment would create one mechanism to ensure fairness in the planning system, by allowing not only the pre-application consultation but people to generally give feedback and a say, as they currently can in the English planning system. If the Minister is not minded to accept the amendment, I would be grateful if he wrote to me and the shadow Scottish Secretary, or acting shadow Energy Secretary.

[Michael Shanks]

Both.

[Paul Holmes]

Both—that is the world we are in, unfortunately. I would be grateful if the Minister could see if there is an opportunity for a meeting between himself and that shadow Minister on how we can strengthen the grassroots-level consultation that is important to the system. I look forward to the Minister’s response. If we could secure some unofficial channels on how we can strengthen this clause when we get to further stages, I would be grateful. I will not push the amendment, but I would like the Minister to respond to those concerns.

[Michael Shanks]

I thank the shadow Minister for the way he is discussing these topics. I appreciate that they are from a planning system alien to the one with which he is, I am sure, very familiar—I am tempted to say that the shadow Energy Secretary could join him on the Bench, but he is not here.

I understand the point that the shadow Minister is making. For hon. Members who are not familiar with the Scottish system, a public inquiry can be triggered with one objection into the planning system. The public inquiry can take years to conclude and often is not reflective of actual community sentiment on a particular project. This system does not exist in any form anywhere else in the UK. The purpose of these consenting reforms is to deliver significant efficiencies in the consenting process, and to make decisions faster—not necessarily to make positive decisions faster, just to make decisions faster. Introducing another element that feels like the element that we are removing takes away from that.

As I have said previously, there are still significant opportunities for communities to participate in the process. One of the key aspects that we are introducing is the right of a reporter, who is an experienced specialist in planning and consenting, to consider representations about whether there should be a public hearing on a particular process. That reporter will then make the decision about whether it should go forward into a hearing session or a public inquiry. That is rather than what we have at the moment, which is an automatic trigger that holds up projects for a significant length of time.

I am always happy to meet with the shadow Scottish Secretary on a range of things. I am happy to engage with him, because I appreciate that his part of Scotland has a significant amount of network infrastructure being built; but for the reasons I have outlined, this amendment goes counter to our objectives, and does not sit with the reforms we are making to the Scottish planning system, as distinct from the planning system in England and Wales.

[John Grady]

I will make a couple of brief remarks as a resident Scottish MP. The Minister has referenced co-operation between the Scottish and UK Governments. That is to be welcomed; it reflects this Government’s determination to do right by Scotland and to work productively with the SNP Government in Holyrood.

These provisions will help to unlock significant investment in Scotland. We heard last week how SSE’s programme of projects, which these provisions help to unlock, will lead to £22 billion of investment by 2030. That is the biggest investment we have seen in the north of Scotland since the second world war. Just think what we could achieve if we had a Labour Government in Scotland as well as in England.

The Minister is right to have worked closely with the Scottish Government on reforming the provisions, which in many cases predate 1989, because the 1989 Act was a consolidation. He is right to have worked productively with the Scottish Government, putting Scotland first, because that will give rise to significant investment and jobs—jobs for our young people and high-quality jobs—as well as access for the people of Great Britain to greater volumes of fixed-price electricity that is not subject to fluctuations in wholesale markets, as we have seen over the last few years.

[The Chair]

With this it will be convenient to discuss the following:

Clause 15 stand part.

New clause 53—Reforms to consenting process for electricity infrastructure in Scotland—

“Where any reforms to the consenting process for electricity infrastructure in Scotland are proposed, the Secretary of State must ensure that such reforms—

(a) do not reduce requirements for community engagement or public consultation;

(b) include measures to address local concerns, environmental impacts, and impacts on all key sectors including but not limited to agriculture and tourism.”

New clause 54—Annual report on consents for electricity infrastructure in Scotland—

“(1) The Secretary of State must annually lay before Parliament a report on applications for consent for electricity infrastructure in Scotland.

(2) A report under this section must include—

(a) the outcomes of each application for consent relating to an energy infrastructure project in Scotland;

(b) evidence of community consultation undertaken in relation to each application and, where applicable, how consultation has influenced the design of the infrastructure to which the application relates; and

(c) estimates of economic benefits to local communities from the relevant project.”

[Michael Shanks]

I will begin with a brief explanation as to why clause 14 should stand part of the Bill. I return to the point that my hon. Friend the Member for Glasgow East made a moment ago, and one that I have made before, which is that these reforms were in the pipeline under the previous Government. They are reforms to a long-standing piece of legislation that is long due for updating.

I thank officials in my Department and in the Scottish Government for working closely and at speed, with a similar set of objectives and an open-book approach to making this work, to draft the measures in a way that works for all of us. It is a reset of the tone of how we work as two Governments.

On enabling the introduction of pre-application requirements, as the hon. Member for Hamble Valley referenced, in the Scottish legislation there are currently no steps to give the public an opportunity to engage as there are in the NSIP regime in England and Wales. This is about improving the quality and readiness of applications at the submission stage. It is important to say that this was driven by the views of Scottish Ministers, who said that they thought it was a useful process, but it will be directed in detail in regulations so that it can be updated and adapted to situations, unlike the process that we have in England and Wales at the moment, which has been held back and has added time and complexity to projects and not delivered what it was intended to do. It will give Scottish Ministers the powers to charge fees for pre-application services, enabling them to better support applicants in developing good-quality applications.

Secondly, the clause establishes a power to set time limits through regulations for key stages of the consenting process, which will support the timely determination of applications and bring down overall processing times. Thirdly, it will establish a proportionate process for responding to objections by relevant planning authorities through a reporter-led examination process. The reporter will choose the most appropriate procedure for gathering any further information they need to provide recommendations in a final report to Scottish Ministers. That may include inquiry sessions, where the reporter considers that that is the best approach to take to address particular issues. Such an approach is similar to the well-established process in which appeals in the town and country planning decisions are currently addressed.

Clause 15 enables regulations to be made that prescribe new processes to vary electricity infrastructure consents in Scotland after they have been granted. The clause addresses the current anomaly that there is no prescribed procedure for holders of overhead line consents to apply to Scottish Ministers for a variation to their consents. The current position forces consent holders to make full consent applications in order to authorise often very modest variations. The clause also allows Scottish Ministers to vary an existing generating station or overhead lines consent due to changes in environmental circumstances or technological changes. Such variations will be made with the agreement of the consent holder. Finally, the clause allows Scottish Ministers to correct any errors or omissions made in consents for generating stations or overhead lines.

I will come back to the new clauses later, but I want first to underline the importance of the consenting process. In Scotland, we generate a significant amount of electricity, and there are further projects in the pipeline, including both floating offshore wind and onshore wind. It is critical that there is an off-taker for that power in the rest of the UK, and that requires us to build significantly more network infrastructure to bring that clean power to where it is required. Although these changes to consenting relate to Scotland, they are of critical importance for the energy security of the whole United Kingdom.

[Paul Holmes]

I would like to move new clauses 53 and 54, but I would like to hear what the Minister has to say about them first.

[The Chair]

Minister, are you happy to do that now?

[Michael Shanks]

The shadow Minister wants to hear more! New clause 54 is in the name of the hon. Member for Gordon and Buchan (Harriet Cross)—I want the shadow Minister to say, “Gordon and Buchan”, just so I can hear his pronunciation. The clause would require the Secretary of State to produce an annual report providing detail of electricity infrastructure consenting decisions made in Scotland in previous years.

As hon. Members will be aware, responsibility for the consenting process for electricity infrastructure in Scotland is devolved to Scottish Government Ministers. The Scottish Government are accountable to the Scottish Parliament—not the UK Parliament—for the decisions that they make, for the rationale behind them and for what information they choose to provide on consenting decisions. I am aware that the Scottish Government publish all their decisions, which includes information about what public consultations have taken place and consultations with community councils, for example.

It would be inappropriate and potentially duplicative for the Secretary of State to have such an obligation, but fundamentally, to come back to the point I made earlier, there is a particular concern about putting a statutory obligation on what is a devolved power when there is a democratic link between Scottish Ministers and their democratically accountable Parliament, which is the Scottish Parliament and not this Parliament.

[Paul Holmes]

Do I move the new clauses now?

[Paul Holmes]

Thank you. I must apologise, Mr Twigg; this is the first time I have been a shadow Minister on a Bill Committee and I am a bit rusty, but I am learning very quickly.

I thank the Minister for Energy for being very gentle with me as well when discussing Scottish energy connectivity and Scottish planning. He will understand that beggars cannot be choosers on the number of MPs that we have, but being a Member for what is possibly the most southern part of the south coast that one can get bar the Isle of Wight, I am doing my best to discuss the Scottish planning system. I am grateful for the spirit in which he is responding to our new clauses and amendments. I am also grateful to his officials for their work, too.

I understand what the Minister is saying, and I know his reasons for refusing to accept previous amendments under clause 14, but these new clauses create a parallel system. He is absolutely right that Scottish Ministers are accountable to Scottish people and the Scottish Parliament, but Scottish Members of Parliament here are accountable to their constituents. The Secretary of State also has a role within this Parliament and within this UK Government. On new clause 54, the Minister is quite right to say that the Scottish Parliament already has that reporting mechanism, but I do not think that it is unreasonable that the Secretary of State should be able to do that for Scottish MPs here too; when we have questions to the Secretary of State for Scotland, we discuss UK legislation relating to Scotland.

[Michael Shanks]

That is reserved.

[Paul Holmes]

The Minister keeps saying “reserved”. That is fine, but we have a Secretary of State for Scotland, accountable to a UK Parliament, who represents Scottish constituencies. There is a role for this Parliament to report and to scrutinise the successes of the Scottish Executive and the UK Government, with the Secretary of State having an overarching position as Secretary of State representing Scotland. Scottish Members of Parliament are entitled to the same rights and benefits as Scottish MSPs when scrutinising the Scotland Government north of the border. The Minister wanted me to pronounce “Gordon and Buchan”. I think that is right—I am not sure, but I did my best. Honestly, there are worse ones to pronounce.

Clearly, we are going to disagree on our approach to these two new clauses, but the reason for new clause 53 is exactly the same. I am surprised by the Minister’s reticence in allowing his Scottish colleagues to be able to have the same rights of scrutiny as Scottish MSPs. It is not an arduous new clause. It would not be arduous on the Government or the Scotland Office to produce those outcomes or statistics. It would not be arduous on the Scotland Office or the Department for Energy Security and Net Zero to provide evidence of community consultation, particularly when we have just discussed some of the amendments that the Opposition have tabled on community consultation.

It would also not be arduous for the Scotland Office—or whatever Department would be answering—to provide estimates of economic benefits to local communities. That is exactly why many members of this Committee who represent Scottish constituencies are here in this UK Parliament: to develop policy that brings economic benefits to local communities. The Minister needs to think outside the box and allow Scottish MPs from all parties in this House to have those rights to scrutinise, to develop the economic benefits to local communities. He should not feel so constrained by the Scottish devolved Administration; he should branch out, improve and increase the power of the Scotland Office or his Department, and allow Scottish MPs to have their say in this area of legislation.

[Michael Shanks]

I am in danger of going into British constitutional politics 101, but the hon. Gentleman is introducing the West Lothian question.

[The Chair]

We have to be very careful given the subject of the amendment. I gave the shadow Minister a bit of leeway.

[Michael Shanks]

The shadow Minister is introducing the best example I have heard in a long time of the West Lothian question. The fundamental thing is that this is not a political question about the Scottish Government or the UK Government. There are reserved matters for which this Parliament is responsible for holding UK Government Ministers to account, and there are devolved matters that Scottish Ministers have responsibility for delivering and the Scottish Parliament is responsible for holding them to account for.

It would ride roughshod over this Parliament’s fairly consistent support of devolution in the UK for us to now suddenly say that those Scottish Ministers are also accountable to another Parliament. I think that we agree on the nature of devolution in this country, although we may strongly disagree on the actions that devolved Governments take, but we cannot support the new clauses, for the reasons I have outlined. This is not about thinking outside the box; it is about recognising the role that the devolved system plays in our constitution. For those reasons, I will resist the new clauses.

--- Later in debate ---

[Michael Shanks]

Clause 16 amends section 36D of the Electricity Act 1989, which provides for a statutory appeal to be brought by any person who is aggrieved by a decision made by Scottish Ministers—perhaps the shadow Minister. A challenge to an offshore electricity infrastructure consenting decision made under section 36 is by statutory appeal. The clause extends this, so that statutory appeal also applies to onshore electricity infrastructure consenting decisions made under section 36, decisions made under section 37 and all variation decisions.

The clause will create consistency in Scotland by making the challenge process the same for both onshore and offshore consents, and ensuring they are brought in a timely manner. A challenge will have to be brought within six weeks for onshore consents, as is already the case for offshore consents. This will bring the timescale for challenging large electricity infrastructure decisions into alignment right across Great Britain.

Clause 16 also amends the Electricity Act so that the six-week timescale for bringing a challenge commences from the publication of the decision by the Scottish Minister, instead of the date on which the decision was taken. This is a new requirement for both onshore and offshore, and is compliant with the Aarhus convention compliance committee’s recommendations relating to the timescale for challenging planning decisions. There is also a consequential amendment to the Town and Country Planning (Scotland) Act 1997 in respect of directions relating to deemed planning permission. I commend the clause to the Committee.

[Paul Holmes]

My contribution will be very short, because the Opposition agree with what the Minister said. It seems perfectly reasonable to amend section 36D of the Electricity Act 1989, which allows anybody aggrieved by the process to appeal. That is a welcome step that meets some of our challenges in other areas of the Bill—not those for which this Minister is responsible—in relation to people being intimately involved in some of these decisions. If people are not happy with what is happening in their local communities, they should be able to challenge it. I welcome the clause, and we will not press it to a vote.

[Gideon Amos]

We do not object to the clause either. The date of the judicial review challenge being six weeks from the issue of the decision in writing is consistent with the approach under the Town and Country Planning Act, and therefore does not reduce or change people’s right to judicial review. We are content to support the clause.

Question put and agreed to.

Clause 16 accordingly ordered to stand part of the Bill.

Clause 17

Applications for necessary wayleaves: fees

Question proposed, That the clause stand part of the Bill.

[Michael Shanks]

Clause 17 will confer a power on Scottish Ministers to make regulations to set and charge fees to electricity network operators for processing necessary wayleave applications that they should make in Scotland. Necessary wayleaves are statutory rights that allow electricity licence holders to install and access their overhead electricity lines and associated infrastructure on land owned by others, and in Scotland they are processed and granted by Scottish Ministers.

The objective of the change is to better resource the processing of necessary wayleave applications by the Scottish Government. It is important to act now.

[Lewis Cocking]

Will the Minister elaborate on why he did not support amendment 80, which we have just discussed, on planning fees going to local councils to resource planning departments? What is the difference between that and him saying to Scottish Ministers under this clause that they can charge a fee, but that it has to go to the resourcing of dealing with these applications?

[Michael Shanks]

Perhaps I misunderstood the hon. Gentleman’s point, but I think that amendment 80 was about forcing Scottish Government Ministers to spend funds on community benefits and other things. This clause is saying that the Government will have the power to raise application fees if they choose to do so. Of course, they could choose not to, but under this clause they will have the power to raise them.

[Lewis Cocking]

It says that the Minister expects that money to be put into the system to make the system better. Why has he done that in this case when he did not support the amendment doing it?

[Michael Shanks]

As I think I have just outlined, that amendment did not just call for the money to make the system more efficient; it called for it to be spent in communities on community benefits. That is quite different. My argument to the shadow Minister in resisting that amendment was that we did not want to tie the hands of the Scottish Government, because we see that investing that money in making the planning system more efficient is probably the best use for it, but it is not for me to tell them that. This clause is about giving them the power to set and charge fees to electricity network operators. I suggest that the point he is making is a slightly different one, but if I have misunderstood him, perhaps he can explain.

[David Simmonds]

A general point arises here, which we also debated on the Renters’ Rights Bill Committee. The different systems in Wales, Scotland, Northern Ireland and England—most of the legislation we are dealing with here is for Scotland, Wales and Northern Ireland—give rise to a risk of inconsistency. The shadow Minister spoke of the importance of community benefit. That is designed to secure community support. If there is a view that Ministers in Scotland might choose to spend such revenue on other things to the detriment of community benefit, that may also undermine consent.

I completely agree with what the Minister is saying about creating the necessary power, but will he commit to further discussions with his colleagues in the Ministry of Housing, Communities and Local Government so that we can ensure—not just in this Bill, but in future legislation—that where we expect a community benefit to derive from something that we decide on, it will be a consistent benefit across the UK?

[Michael Shanks]

In general, I agree and disagree with the hon. Gentleman’s point. I understand the point he is making about consistency, but I take the view that the whole purpose of having different devolved Administrations in England, Wales and Scotland is to make different decisions. Northern Ireland is separate in the energy discussion, because it has a separate grid.

I am not sure that I would say that consistency at all costs is the right approach. We created the Scottish Parliament and the Welsh Assembly so that they could make decisions locally that affected them in a different way. We have worked with the Scottish Government on these changes to make sure that there is a package of reforms to the consent arrangements under the Energy Act that relates to the planning system in Scotland as it currently is. It is not the same starting point as the system in England and Wales, so it is important to look at them separately. Nevertheless, I understand the hon. Gentleman’s point.

I return to clause 17. Fees are already charged in England and Wales for processing wayleave applications. I reiterate—this comes back to the point made by the hon. Member for Broxbourne—that the Scottish Government do not have the power in legislation to raise those fees. That power is reserved. The clause will give them that power.

[Paul Holmes]

Has the Minister identified or outlined any potential total income that will come out of this measure? I know that it is not a certain process and that it is not certain how many will come forward.

[Michael Shanks]

No, we have not. A series of work will be necessary to come up with that figure, because the fees will be charged on a cost recovery basis. It is not a money-making exercise for the Government. That is in line with approaches in the rest of Great Britain. There will clearly be a significant number of such applications in the coming years—more than in previous years, probably—but the detail will be worked out with the Scottish Government. We do not know in advance exactly how many wayleave applications there might be, so we cannot give an exact figure.

[Paul Holmes]

I thank the Minister for his answer. He will forgive me for intervening again; it will mean that I speak less later. In outline, has he started any engagement with Scottish Ministers to find out whether the intention of the clause will be borne out in reality? If the costs are being recovered on a cost recovery basis, has he secured the necessary assurances from Ministers that the money collected will be used to process the decisions more rapidly, and that it will not be spent in other devolved Scottish areas?

[Michael Shanks]

I am sorry to come back to this point, but the Government do not bind the hands of devolved Governments in any spending area. When this Parliament—[Interruption.] No, I did not say that. I said that the Bill gives them the power to do that, which they do not currently have.

[Lewis Cocking]

Will the Minister give way?

[Michael Shanks]

No, I will carry on answering this point, if that is okay.

We are very enthusiastic about clause 17—who would have thought it? To be clear about this point—I feel as if I am the only Scottish MP on this Committee, but I am not—when this Government increase spending in a particular area, that results in a budget transfer to the Scottish Government, the Welsh Government and the Northern Irish Executive, which they can spend on whatever they see as their local priorities. An increase in NHS spending in England does not lead to the exact same in Scotland. We will not bind the hands of every single decision that is made in this case. This is about conferring a power on Scottish Government Ministers to set and charge fees to electricity network operators for necessary wayleave applications in Scotland.

[John Grady]

I thank the Minister, although he must feel awfully lonely as the Front-Bench Scotsman. As the Member for Rutherglen just on the other side of the Clyde from me, does he agree that the charging of fees for necessary wayleaves is a rather odd way to relitigate the referendum that took place in 1999, and a rather odd way to relitigate the questions of devolution? I know that the Conservative party has some trouble, from time to time, in accepting the devolution settlement. We seem to have moved from the West Lothian question to the Hamble Valley question. It is remarkably confusing.

[The Chair]

Order. Let us stick to the point.

[Michael Shanks]

Thank you, Mr Twigg. That is helpful.

[Lewis Cocking]

Will the Minister give way?

[Michael Shanks]

No, I will respond to that point, if I may. I respect the view of the Conservative party and the argument that Conservative Members are making. I completely understand it, but I am trying to make the point gently that this is not about our directing specific decisions that will be made by Scottish Ministers. It is about how—in this case, as it is across wayleave applications in England and Wales as well—fees will be charged on a cost recovery basis in line with UK and Scottish Government policy on managing public money.

[Lewis Cocking]

Let me try a third time. According to the explanatory notes laid out by the Government:

“The objective of this change is to better resource the processing of necessary wayleaves applications by the Scottish government.”

The Minister is therefore directing the Scottish Government to spend the money that they get in through this process on that planning process. How is that different from amendment 80 which we discussed earlier and the Government said they will not accept?

[Michael Shanks]

I am trying to find the exact wording. I will come back to the hon. Gentleman. I think I have outlined to him three times now why it is different. I do not have amendment 80 in front of me at this precise moment, but it had two parts to it, one of which was about community benefits. It was directing the Scottish Government to take funds and direct them to a specific purpose. This Parliament does not do that in any other aspects of devolved policy, because it is devolved to the Scottish Parliament to make those decisions. I think that I have made that point clear, but if not, I will write to the Committee and make it even clearer. [Interruption.] I am grateful. I now have amendment 80 in front of me. It mentions

“consumer benefits packages, or…local planning authorities”.

Neither of those things is in the gift of the UK Government to direct the Scottish Government to do. Consumer benefits packages are ill-defined, if nothing else, but local planning authorities are democratically elected in their own right, and the Scottish Government make budget decisions to local government, separate from any budget decisions that the UK Government make to the Scottish Government. The two are not comparable in any way. In any event, the Committee has already voted down that amendment.

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[Paul Holmes]

I will confine myself to clause 17. The Minister has often said that he does not want to direct Scottish Government Ministers on a devolved issue. That is perfectly reasonable. When I last intervened on him, I did not ask him to dictate to Scottish Government Ministers; I asked whether he had sought an assurance from them—

[Michael Shanks]

It’s the same thing.

[Paul Holmes]

It is not the same thing. I asked him, in his role as a UK Government Minister, to seek an assurance from Scottish Government Ministers that the retrospective collection of funds under the new power would be used to increase capacity and improve the processing of this proposal. He was not rude to me, but he said, “That’s not my job as a UK Government Minister. It’s up to them as Scottish Government Ministers.” His own explanatory notes say:

“The objective of this change is to better resource the processing of necessary wayleaves applications by the Scottish government.”

When I asked the Minister whether he had sought an assurance from Scottish Government Ministers, I was not asking him to instruct them. I asked him whether he had any information on the total amount of money that would be brought in, which I accept could vary. I perfectly understood and respected that answer, but in his second answer he said that he could not seek such an assurance because he does not want to direct Scottish Government Ministers or take power away from them. Given the objective set out in the explanatory notes, how can we have confidence—

[Michael Shanks]

Will the hon. Gentleman give way?

[Paul Holmes]

Of course.

[Michael Shanks]

There is no contradiction here at all. We are confusing two different things. My ability to say that the Scottish Government could raise x amount of money and must spend it on y is different from what we have clearly outlined—the hon. Gentleman has just repeated it—which is that at the moment Scottish Government Ministers do not have the power to raise fees for wayleaves, as is the case in England and Wales. Those are two very different things.

I have said clearly, I think six or seven times now, that at the moment Scottish Government Ministers have no power to charge for the processing of wayleave applications. The clause will give them the power to do so. Of course, I would hope that those funds will be spent on the planning system, or whatever it might be, but I am not going to bind their hands and evaluate the success or otherwise of that in this Committee. The two issues are quite separate.

[Paul Holmes]

We are dancing on the head of a pin here. I know that the Minister has no power to do that and does not want to have such a power, but how can he, as a UK Government Minister, commend a clause whose objective the explanatory notes explicitly say

“is to better resource the processing of necessary wayleaves applications by the Scottish government”

while claiming that he does not have the power to ensure that it happens?

I am not trying to be difficult. The Minister is doing a very good job of outlining the clauses, but he has said several times in response to my hon. Friend the Member for Broxbourne—not just in relation to amendment 81, which was not accepted, but in relation to the clause—that he does not have the power to direct Scottish Government Ministers. All I am asking is why he set out the objective of the change in his approved explanatory notes if he cannot make it happen.

I am not asking the Minister to strengthen the legislation; I asked whether he has sought reassurances from Scottish Government Ministers that that is what they will do with the extra income from the measures. He answered that he did not want to force them. That was not the question. All I am asking—he is welcome to intervene on me—is whether he has had a conversation with Scottish Government Ministers about whether they will use this income for the purposes that his legislation has set out.

[Michael Shanks]

I have not had the conversation. I am happy to have it, but the tone will not be, “Here are my expectations of you as a democratically elected Member of the Scottish Parliament accountable to a Parliament I do not sit in.”

I do not know how familiar the shadow Minister is with the devolution legislation in the United Kingdom, but I gently say that this Parliament gives the devolved Administrations power to raise a whole series of taxes, charges, levies, fines and various other things. We give that power to those devolved assemblies; we do not then tell them exactly how to spend every single penny of that money. This is another example of that. It is a perfectly common thing in the devolution settlement.

[Paul Holmes]

I am not trying to be difficult with the Minister at all—I know it seems that I am, but I am not. He said that he has not had those conversations but he now will, and that is welcome. This clause is procedural and process-driven, but within the grand scheme of the Bill it is stated clearly in black and white that the UK Government have an objective for the extra income to be generated, yet the Minister has not had that conversation with Scottish Ministers. I do not blame him for that, but he will now have those conversations going forward.

I hope that when it comes to other clauses, UK Government documents will be very clear about the aims, ambitions and outcomes of what they will do because what we have seen this afternoon has been questionable. The UK Government are setting an objective, with no way to actually achieve it.

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[The Chair]

With this it will be convenient to discuss the following:

Clause 19 stand part.

Schedule 1.

[Michael Shanks]

Clause 18 is technical, amending section 106 of the Electricity Act 1989 to make provision for procedural requirements that apply to the new powers conferred by the provision in clauses 14, 15 and 17. All new regulation-making powers, except for the power to amend primary legislation in clause 14(4), are subject to the negative procedure. Scottish Ministers or the Secretary of State must consult each other before making regulations relating to clauses 14 and 15. The power in clause 17 is to be exercised by Scottish Ministers, and it does not require the Secretary of State to be consulted.

Clause 19 introduces schedule 1, which makes amendments to the Electricity Act 1989 consequential to the amendments made by clauses 14 to 18. It also makes some minor amendments relating to consents for electricity infrastructure in Scotland. These amendments are made to sections 36, 36B, 36C and 37 of and schedule 8 to the 1989 Act. Schedule 1 is needed to ensure the Bill’s consistency and clarity in relation to the 1989 Act. Some changes are needed to ensure that the new Scottish consenting reforms can function as intended. Some of the clarifications are needed because the 1989 Act was originally drafted prior to the Scotland Act 1998, which created the Scottish Parliament. Given the number of changes made to the 1989 Act in relation to Scotland, it is necessary to update outdated references in legislation to ensure that such references are clear and consistent.

The consequential amendments cover three main aspects. First, as clause 14 amends schedule 8 to the 1989 Act to allow the Secretary of State or Scottish Ministers to make regulations about time limits for various parts of the consenting process, the amendments clarify how this relates to Scottish Ministers obtaining advice from the Scottish Environment Protection Agency. Secondly, as clause 14 amends schedule 8 to 1989 Act to allow the Secretary of State or Scottish Ministers to make regulations about applications made to Scottish Ministers, amendments have been made so that proposed new section 1A will apply only to applications made to the Secretary of State, not to those made to Scottish Ministers.

Thirdly, there are clarifications to reflect the new processes for variations of consents and the new procedure following objection by the relevant planning authorities for consents under sections 36 and 37 of the 1989 Act. In addition, the minor amendments include those to reflect previous transfers of functions to Scottish Ministers, and some references to the water environment regulations are updated to refer to the most recent version.

As I have said, this is a very technical clause. I look forward to having slightly less debate on it, unless there are any questions.

[Paul Holmes]

Clauses 18 and 19 are consequential to the previous clauses, and consist of simple process amendments. The Minister will be delighted that we welcome the fact that clause 19 amends the Electricity Act 1989 to reflect earlier transfers of functions to Scottish Ministers. That is exactly as it should be, and we will not be scrutinising the various words. These amendments should go ahead, and I have no further comments.

Question put and agreed to.

Clause 18 accordingly ordered to stand part of the Bill.

Clause 19 ordered to stand part of the Bill.

Schedule 1 agreed to.

Clause 20

Environmental impact assessments for electricity works

Question proposed, That the clause stand part of the Bill.

[Michael Shanks]

Clause 20 creates a power for the Secretary of State or Scottish Ministers to make limited procedural amendments to the Electricity Works (Environmental Impact Assessment) (Scotland) Regulations 2017, which for ease of reference I will refer to as the EIA regulations.

As part of the consenting process for electricity infrastructure in Scotland, Scottish Ministers are required to assess the likely significant environmental effects arising from a proposed EIA development. Before the UK left the European Union, Scottish Ministers and UK Government Ministers had concurrent powers, under the European Communities Act 1972, to make regulations for electricity works EIAs. However, although the EIA regulations remained in force as assimilated law after the European Communities Act was repealed, the result is that neither Government have the power to amend them.

--- Later in debate ---

[David Simmonds]

We broadly support the content of clause 20, but I have one question for the Minister. I am mindful of his comments about the process of EU retained law, and it is absolutely right that we are looking to update that. However, a lot of the new powers set out for Scottish Ministers are the kind of thing that, in England, we would expect to be the subject of a pre-application consultation. One might ask the promoter of a project to come in and discuss those exact things with the local authority, the strategic planning authority if there is one, or the mayoral authority or the combined authority, so that the application process can be streamlined as much as possible.

Earlier on, we said that we would amend legislation through the Bill to remove that process in England. Given the intention to effectively introduce a top-quality process for applications to be considered in Scotland, does the Minister agree that there is an element of contradiction in that, in the same piece of legislation, we are seeking to remove many of the equivalent processes in England?

[Michael Shanks]

I understand the argument, but it appears as a contradiction only if we assume that both planning systems are the same, which they are not. And they are not slightly different—they are fundamentally different. The processes are different. The timescales are different. The opportunities for public consultation are different throughout, so we are starting from a different starting point. Although I understand the hon. Member’s point, I do not think that the two are comparable.

This particular clause is even more narrow than the hon. Member recognised. It is simply about the assimilated regulations. I have been in a number of Delegated Legislation Committees where we have discussed some of the unintended consequences, as we obviously assimilated thousands of different pieces of legislation into UK law. As I say, the result was that neither the UK nor the Scottish Government currently have the power to amend these regulations, which is a ludicrous position for us to be in. This clause is narrow in scope, and I do not think it has quite the reach that the hon. Member is suggesting.

Question put and agreed to.

Clause 20 accordingly ordered to stand part of the Bill.

Ordered, That further consideration be now adjourned. —(Gen Kitchen.)

Planning and Infrastructure Bill (Fifth sitting)

Michael Shanks Excerpts

Committee stage
Tuesday 13th May 2025 Public Bill Committees

[The Chair]

I remind Members to send their speaking notes by email to [e-mail] and to switch electronic devices to silent. Tea and coffee are not allowed during sittings. It will probably get very hot, so if you would like to take off some of your layers, that is absolutely fine.

Clause 21

Long duration electricity storage

Question proposed, That the clause stand part of the Bill.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

Thank you, Mrs Hobhouse. On that cheery note, it is great to be back in Committee this morning.

The clause is about long-duration electricity storage, or LDES, which is an incredibly important part of an electricity system, allowing us to store cheap renewable energy when the wind is blowing and the sun is shining, and to generate electricity when people need it most. It is a crucial part of our clean power mission.

Across Great Britain, we already have 2.8 GW of LDES on the grid. I have had the pleasure of visiting some pumped hydropower stations that have been part of our system for decades. They allow excess electricity to pump water high up to a mountain reservoir, where it can be released when we need it to drive turbines and generate electricity. The most recent of those sites, however, was completed more than 40 years ago. The clean power 2030 action plan suggests that we need another 1.2 GW of LDES in the next five years. The National Energy System Operator suggests that we could need up to 15 GW by 2050, so a significant increase on where we are today.

Despite low operating costs and high system-wide benefits, which in 2024 were estimated at £24 billion, the large up-front capital costs to build such stations in the first place, and the revenue uncertainty over such a long lifespan of an asset, have deterred private investment in LDES over the decades. The clause therefore introduces a cap and floor scheme to develop new long-duration energy storage in Great Britain.

Those wishing to develop an LDES asset will be able to apply to Ofgem for protected revenues, conditional on satisfactory delivery and operation and on sharing excess profits with consumers. That provides the revenue certainty needed for investors, giving the green light for the next generation of those important assets. We expect—we have set out deliberately—that this will be technology-agnostic. We therefore expect that we will have more pumped hydro, as well as more novel technologies such as liquid air energy storage.

The clause imposes a duty on Ofgem to establish and operate a cap and floor scheme to encourage the development of LDES assets across Great Britain. The clause also defines the minimum eligibility requirements for the scheme: assets will need a minimum power output of 50 MW, and to be able to discharge at full power for eight hours without recharge. Simply meeting those requirements, however, will not guarantee success, and Ofgem will only select the projects that are most useful for system-wide benefits and for consumers. The clause gives the Secretary of State the power to update that definition by regulation. It also defines in broad terms how Ofgem will set the cap and floor, and how it will fund floor payments.

This is a really important step. As I say, after 40 years of not building long-duration energy storage in this country, we are incredibly excited to be building it once again. It is also crucial to how we deliver the clean power system in the future. I commend the clause to the Committee.

[Paul Holmes (Hamble Valley) (Con)]

Good morning, Mrs Hobhouse. It is a pleasure to serve under your chairmanship and to see you again. I welcome both Ministers to their places. As soon as you said that we can start removing layers, Mrs Hobhouse, my button suddenly popped off. I apologise, and I guarantee that I will not remove any more layers, for fear of disrupting the Committee.

The clause amends the Electricity Act 1989, requiring the Gas and Electricity Markets Authority to implement a cap and floor scheme for long-duration energy electricity storage or LDES. We are concerned that the clause introduces unnecessary bureaucracy and will distort the market with the introduction of the scheme. I have several questions on this. Can the Minister explain what criteria will determine the initial cap and floor levels? More importantly, how frequently will they be reviewed to stay responsive to market changes?

We know that the scheme aims to provide financial stability to LDES for operators by setting revenue caps and income floors, and to encourage investment in this technology. However, will LDES operators and investors have a role in reviewing or adjusting the scheme to ensure that it reflects real-world conditions? Will there be eligibility criteria for a formal application process for operators to access the scheme, ensuring fair access for all players? Those concerns, we would argue, highlight the need for clarity and effective integration with broader energy policies and to ensure the scheme’s success. I look to the Minister for clarification on those elements of the clause. We do not intend to divide at this stage, but we will provide further scrutiny at further stages of the process.

--- Later in debate ---

[John Grady]

I apologise for not indicating properly.

[Michael Shanks]

I thank all hon. Members for their contributions and their recognition, first and foremost, of the important role that long-duration energy storage plays in our system. My hon. Friend the Member for Glasgow East referred to Cruachan—the hollow mountain —and I think there is barely a person in Scotland who has never been on a school trip to there. I would recommend it to anyone; it is a fantastic example of not just how important this is to our energy system, but the engineering that has lasted a significant number of decades and still runs on our system. It plays an incredibly important role.

The shadow Minister, the hon. Member for Hamble Valley, raised a number of important questions. Ofgem has consulted on the process for the first window of the cap and floor scheme. It has published detailed, technical guidance on what we would expect those projects to be able to deliver. We, and Ofgem as the regulator, have very deliberately been technology-agnostic to allow more of these innovative projects to come forward. That first round will run its course, but we absolutely would expect that Ofgem and the Government will look at the results of that review and see if there are areas that we might improve on for a further round if that is deemed necessary. We will keep the scheme constantly under review.

The cap and floor scheme that Ofgem has run for interconnectors has been an incredibly successful way of delivering value for money for consumers and of giving that revenue certainty over the long term. It is a model that works very well. We will review the projects that move forward in the scheme. As I outlined, there are technical requirements that they must meet, but there will also be a process of ensuring that the projects deliver value for money for consumers.

The hon. Member for Taunton and Wellington rightly recognises the role that LDES plays in the mix. We could see some battery projects coming forward in this round. Traditionally, they have not been part of long-duration energy storage, but that technology is moving forward rapidly and some might be able to bid into this process. There are some really innovative projects in that space.

It is important to take the question of how we deal with safety risks for batteries in a balanced way. There are safety incidents for a whole range of infrastructure in our country; some get a lot more attention than others in the media, and we need to be careful not to draw more attention to one particular technology at the exclusion of others. But the hon. Member for Taunton and Wellington is right that safety should be paramount in everything we do with every energy system and every part of infrastructure.

We are looking at the wider question of how we might introduce additional safety measures on battery storage sites more generally, not just as part of the LDES scheme. The Health and Safety Executive has a key role in regulating battery designers, installers and operators to ensure that they take the necessary measures to ensure health and safety. It is an important step, and one that we take seriously.

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

I want to press the Minister on the point raised by the hon. Member for Taunton and Wellington. On a visit to the London Fire Brigade I learnt that there is a particular set of risks associated with batteries—essentially, the difficulty of putting the fires out.

In the grand scheme of things, batteries are not more serious than, for example, oil storage, but they require different equipment and differently trained and equipped crews to respond. Will the Minister say more about how, as batteries become a more significant part of the energy mix, he will ensure that fire brigades are able to take a view at the planning stage and are made aware of the risks—just in case they have to respond?

[Michael Shanks]

The hon. Gentleman makes an important point, which we will take onboard. It is already part of what the Health and Safety Executive and the Fire Service are looking at nationally in terms of guidelines, but the Government continue to take an interest. The hon. Gentleman is right that as the schemes expand across the country, more fire brigades that may have not had experience of these incidents in the past will have to gain experience. It is an important point and we take it seriously.

On a general point, I am glad that hon. Members across the Committee recognise the importance of LDES. It is genuinely an exciting moment for the country that we will build some of these important engineering projects to deliver the long-duration energy storage that the country needs.

Question put and agreed to.

Clause 21 accordingly ordered to stand part of the Bill.

Clause 22

Benefits for homes near electricity transmission projects

[Paul Holmes]

I beg to move amendment 83, in clause 22, page 29, line 33, after “benefits” insert

“of £1,000 per year for ten years”.

--- Later in debate ---

[Gideon Amos]

I rise to speak to new clause 102, which stands in the name of the Liberal Democrats. This would ensure that all communities hosting major energy infrastructure—solar farms, wind farms, major battery storage, gas, nuclear or other power stations, as well as transmission infrastructure, which is already covered by the Bill—would receive a benefit of 5% of the annual revenue of that project.

Safeguarding the future by tackling climate change is vital, but we are only going to achieve that if we bring communities with us and make it affordable for households. We recognise, and of course welcome, the provision in the Bill for community benefits for those near transmission lines, but those living beside nuclear, gas, coal-fired or other power stations are not eligible for any community support. For example, I supported the development of Ham Farm solar park in Taunton, but none the less the community gets no benefit for the significant impact it is having on that community.

It is time that we had a system that gave community benefit for all energy infrastructure if we are to persuade communities and work with communities to host that infrastructure. If we are going to move Britain to a low pollution energy future with more home-grown energy—something the Liberal Democrats strongly support—we must be willing to compensate those expected to live with and host these enormous developments. It is time, in short, that local people benefited from national energy projects.

Liberal Democrats have consistently led the way on community benefit. My right hon. Friend the Member for Kingston and Surbiton (Ed Davey) brought in the first community benefit system of this kind. In 2013, when he was Secretary of State and making the UK the biggest offshore energy generator in the world, he said:

“Communities hosting renewable energy installations play a key role in meeting the national need for secure, clean energy. It is only right that local people should be recognised and rewarded for that contribution”.

He continued:

“developers already offer community benefit packages on a voluntary basis, we challenged them to do more”. —[Official Report, 6 June 2013; Vol. 563, c. 116WS.]

He then announced an increase in the recommended community benefit package in England from £1,000 per megawatt of installed capacity per year to £5,000, which remains the basis of the system today. Now it is time to extend that benefit to all energy, and to make it proportional to the revenue raised by energy projects. My hon. Friend the Member for Inverness, Skye and West Ross-shire (Mr MacDonald), who is a real champion for his constituency, proposed a scheme such as is set out in new clause 102 to Highland council back in 2021. It is important to recognise that the industry has contributed in this area, and in renewables especially.

In February 2024 the Government, in their document, “Developing Local Partnerships for Onshore Wind in England: Government response”, endorsed the 2013 system of £5,000 per megawatt installed capacity. Our new clause would mean that 5% of revenue from all energy projects goes to local communities. To put some figures on that, Grubb and Garjardo at UCL Bartlett estimate that, in a good year for energy generators such as 2022, UK revenue from renewables was £15.5 billion. Put that across 53,000 megawatts of installed capacity, meaning that £288,00 revenue per megawatt of installed capacity was raised, and 5% of that would be around £14,000 in community benefit per megawatt of installed capacity. In less good years, such as 2021, it might be around £7,000 per megawatt of installed capacity.

With average electricity bills in households being £730 in the UK, it is also important to secure reductions in bills by adopting the Liberal Democrat policy in our manifesto of finally decoupling electricity prices from the wholesale gas price. Based on Energy UK’s figures, that would mean a reduction in electricity costs per household of around £200 per year. The sums yielded to communities through the new clause—around £7,000 in 2021—would be comparable with the volunteered figure of £5,000 from the industry, but with the added benefit that when revenues increase, the community benefit would also increase.

So far the Government have taken only limited steps, which are welcome; but as part of the proposals that we put forward for a similar system in a debate in Westminster Hall in October, we were encouraged by the Minister, the hon. Member for Rutherglen, who said:

“On community benefits in particular, we are continuing—at pace”—

that key word—

“the work started by the previous Government to review how we can effectively deliver benefits for communities living near this infrastructure.”

He said that they were,

“developing clear guidance on community benefits for both the infrastructure and the transmission networks.”—[Official Report, 15 October 2024; Vol. 754, c. 276WH.]

My hon. Friend the Member for Inverness, Skye and West Ross-shire provides an example from the highlands. It is in the periphery of the UK—the highlands and elsewhere—that many of the biggest energy projects are located. Typically, they are areas where there are high levels of fuel poverty, limited access to affordable housing, lower wages, and high costs for electricity connection and heating. Rural areas, where many major projects are built across the UK, share the characteristics of departing young people, sparse and remote public services, especially after the ending of the rural service delivery grant, and poor infrastructure.

Other countries provide compelling examples of what can be done. Denmark, for example, requires new renewable projects to offer at least 20% ownership to local residents. In Germany, local authorities, or Länder, such as Munich, develop their own offshore wind farms, and community benefit comes from the tax revenue that they provide.

Our new clause would see two thirds of the benefit funds designated for the community, by which we mean to be spent in the council ward affected, where community groups themselves could and should be delegated with the power to manage and distribute those funds, with one third used for community benefit at a more strategic level for the council area decided by elected councillors. Fuel vouchers, affordable housing and investment into health and social care could be among the priority candidates for the spending of these benefits. It is unacceptable that these communities, which provide the backbone of our energy revolution, often see little financial benefit from hosting such infrastructure.

[Michael Shanks]

I thank all Members for an interesting debate. Amendment 83 was tabled by the hon. Member for West Aberdeenshire and Kincardine. He is ever present in these discussions, but never present—

[Luke Murphy]

Can I withdraw my criticism about the absence of the shadow Minister for Energy?

[Michael Shanks]

The Minister for Energy made it on to this Committee; the shadow Minister for Energy could have made it on to this Committee as well, so my hon. Friend should not withdraw his criticism so hastily. Anyway, he is ever present in these discussions and we enjoy his contributions from beyond the Committee room.

[Paul Holmes]

I will try not to take that personally. The Minister should be grateful for what he has got. If he wanted a shadow Energy Minister on the Committee, he could have made that known through the usual channels.

[Michael Shanks]

I thank the hon. Gentleman for that important intervention. I will turn to the substance of the amendment before I get into trouble, Mrs Hobhouse.

The amendment seeks to set the level of benefit at £1,000 per year over 10 years. First, I should say I welcome the fact that across the Committee today there is support for that principle. That is really important, because the principle that we want to recognise—to be fair, the previous Government did when they launched the consultation—is that if we host nationally important energy infrastructure, particularly transmission infra-structure, which so often has less of a community benefit in the communities that it passes through, there should be some benefit from it. That is a really important point.

The balance that we sought to strike was to find a way to give a benefit to those households affected by the transmission infrastructure, but also make sure that the wider bill payers across the country that will pay for those community benefits are not saddled with a significant bill as a result. So the balance that we struck was £250 per year over 10 years. I would never seek to question the House of Commons Library, but I think perhaps the hon. Member for Broxbourne might not be correct in his interpretation of its figures. It would be £2,500 over the course of the 10 years that the scheme would be in place. I think that is what he was referring to.

In our view, the point here is that this still provides a significant benefit regarding bills for those households for a substantial amount of time—10 years—but at the same time does not result in significant amounts being added to the bills of other people right across the country who will pay for this. We think £1,000—which we looked at carefully as part of this process—is too much.

[Ellie Chowns (North Herefordshire) (Green)]

I thank the Minister, and I absolutely recognise the importance of the principle of community benefit. However, would he not agree with me that it becomes problematic if we put in specific numbers, such as £250 or £1,000 a year? Inflation will change what that means, so is it not more relevant and logical to place a requirement more like the amendment advocated by the hon. Member for Taunton and Wellington, which talks about a community dividend that is in proportion to the revenues generated by the project rather than an absolute number?

--- Later in debate ---

[Michael Shanks]

I thank the hon. Lady for that point; I will come to the new clause shortly. The difficulty with that approach for transmission infrastructure is that by definition it goes through so many different communities in a linear way that it would be really difficult to divide up that funding among communities. How you define each community is quite challenging, whereas defining households that are within a certain distance of pylons, for example, is very easy, and we want to give a direct benefit to those households.

[Ellie Chowns]

Logically, we could divide by the number of miles of transmission infrastructure in each community.

[Michael Shanks]

I understand the point that the hon. Lady is making, but a transmission line goes through a significant number of communities in a linear way. For a wind farm, you could draw a line around it and benefit all those communities; a transmission line does not work that way, so we would be giving to a significant number of communities who have maybe one or two pylons near them. That is why we think what is most important is that the households closest to the infrastructure get the direct community benefit.

To the point made by my hon. Friend the Member for Basingstoke, this is not the only part of the Bill—we will also have a community benefits fund for infrastructure like substations, where if there is one particular piece of infrastructure built in a community, with all the disruption that goes with building that, wider community benefits come from that as well. It is not one or the other; we are doing both, but in a legislative sense, we only have to legislate on the Bill discount scheme, which is what we are talking about in this amendment.

The shadow Minister asked for detail on some important points—including that we should set out in secondary legislation the specific level of benefit and the duration over which it will be paid. Of course, the £250 a year is a “minded to” position that we have come to as a result of the consultation that the previous Government did and the evidence that we have seen, but that will be set out in secondary legislation, which—to the hon. Lady’s point—allows us to alter that over time if the scheme is successful. This is, in some ways, a trial to find out whether the intended policy outcomes result. I hope that for those reasons—I will come to some others—the hon. Member for Hamble Valley might withdraw his amendment.

Clause 22 is about creating a financial benefit scheme for eligible households living near certain new or significant increases in network transmission infrastructure, and inserts new sections into the Electricity Act 1989. It empowers the Secretary of State to establish and determine the overall design of the scheme, including qualification criteria, scheme administration, enforcement, and provisions requiring the benefit to be passed on.

The “pass-through provision” is outlined in new section 38B(2), and is essential to ensure that the right consumers benefit and to ensure that when an intermediary sits between the electricity supplier and the end user—as happens in some cases—the intermediary will be required to obtain the full benefit and then pass it on to the end user. If this is not complied with, new section 38B(3) allows regulations to provide for the withdrawal or recovery of benefits made to intermediaries.

To enforce compliance with the scheme, new section 38C details the enforcement provisions that may be made in regulations, and I hope this answers the shadow Minister’s point around potential fraud in the system and the imposition of penalties that we will make through secondary legislation for instances of regulations not being complied with. Finally, new section 38D deals with provisions around data collection for the purposes of administering the scheme. Overall, it is worth remembering the purpose of this clause: it is to improve the public acceptability of network transmission infrastructure.

[Lewis Cocking]

I appreciate the Minister’s correction of what I said—the Government are less generous than I interpreted, in terms of the £2,500 over 10 years. But can he give us some warm words about this not replacing any consultation and say that it is on top of all of the consultation and residents being allowed to have their say, and that we will not allow electricity companies just to pay some money and then get away without doing any consultation at all? Can he give us some reassurances on that?

[Michael Shanks]

It is a very important point, and this will come through in the discussions that we will have more generally in this Committee around community consultation, but it will continue to play an important part. I think it is important to separate out any question of compensation from community benefit.

This is not a compensation scheme, and landowners that currently are compensated for infrastructure being built will continue to be compensated through whatever channels that is decided in. This is a community benefit, so it is additional. It is about recognising that it is critical for the future of the country that we build new grid infrastructure, and that if someone hosts that infrastructure they should gain some benefit from doing so. This is our proposal for doing that, alongside the community benefit funds that we have announced.

The Government believe that it is appropriate to set out the full detail on this in regulations, as is the case in many such schemes that have been set up over the years, due to the technical level of detail that will be required, and have drafted this clause to make sure that it applies only to transmission infrastructure, as it is not the intention that it should apply to other technologies. I commend clause 22 to the Committee.

That brings me to new clause 102, tabled by the hon. Member for Taunton and Wellington, which seeks to introduce a scheme that would ensure communities are provided with financial benefits from hosting major energy infrastructure projects from a range of technologies. I welcome the intent of this measure. Indeed, I have had a number of conversations with the hon. Gentleman’s colleagues on this very topic over the past nine months in which I have had the privilege of having this job, and spoken fairly recently to his colleague, the hon. Member for Inverness, Skye and West Ross-shire (Mr Angus MacDonald)—I was in his constituency yesterday, seeing the investment that this Government have made in port infrastructure in his constituency.

We therefore agree broadly with the hon. Member for Taunton and Wellington’s point about how communities should benefit from all this energy infrastructure, but the new clause is not the right way to do it. We are already considering—he quoted myself to me, and I was delighted to hear I was fairly coherent in that debate—the question of wider community benefits. Clearly, at the moment most such community benefit schemes are voluntary schemes run by developers. It is important to say that some of those are actually hugely successful, and communities welcome the collaborative approach in drawing them up, but others are very unsuccessful, and leave communities without the genuine benefits that they should get. We are therefore looking at this really closely at the moment.

As my hon. Friend the Member for Basingstoke noted, we published guidance in May 2025 on community benefit funds for those who live near electricity transmission infrastructure, and shortly we will publish updated guidance for onshore wind in England, which, of course, follows the 10 years of the previous Government’s ban in England. We are also exploring options for our overall approach to community benefits, to provide consistency across different technologies and to maximise the ambition from that. We have left on the table the option of that being mandatory in every case, but we want to look closely at how that would work, and how the design would work to ensure that we are not setting a scheme that does not suit the flexibilities that individual communities might want to take advantage of.

I reiterate that communities are providing a service to this country when they host clean energy infrastructure and there should be a benefit from it. Towards the end of the hon. Gentleman’s speech, he rather veered off community benefits and into an equally important space on community ownership, which is something that I have also had a number of important conversations about. We see ownership of energy by communities as a really important step as well, and that is a step up from community benefits.

[Gideon Amos]

I am extremely grateful to the Minister for addressing the serious points in the new clause, and particularly for saying that mandatory schemes will not be taken off the table. He was coherent back in October, except—if I might suggest—for the phrase “at pace”. Could he explain what “at pace” means in this context, in terms of what the timescale might be?

[Michael Shanks]

That is a question that I have asked myself many times over the past nine months. The problem is that we inherited a number of these things from the previous Government and we are working through them.

I have regular meetings on the subject. It is really important that we get this right, because we need to strike the balance: ultimately, the community benefit funds will, one way or another, be paid for by bill payers, but we want communities to have a real benefit. The balance has to be right because we are trying to bring down bills for everyone across the country. The Conservative amendment would increase people’s bills, but we are determined to try to bring them down. There is a balance to be struck.

We feel that this is an exciting moment to drive community ownership forward. A key aim of Great British Energy will be to drive forward the local power plan, so that communities do not just have benefits from infrastructure, but own some of those benefits. A number of hon. Members across the House have mentioned the real benefits of communities having a stake in projects—they can spend the money on whatever they want to spend it on, rather than on what a scheme might define. The two go hand in hand.

The bill discount scheme is an important step to drive forward community acceptance of new network infrastructure. We will develop proposals at pace for the hon. Member for Taunton and Wellington and for communities right across the country on the wider aspects of energy infrastructure. I hope that he will not move his new clause 102.

[Paul Holmes]

I am grateful to the Minister for some of the answers he has given—

[Michael Shanks]

Some?

[Paul Holmes]

Well, I am grateful to him for trying to give all the answers, but I only agree with some of them, as he would expect. I wish that he would accept the amendment, but he has stated clearly that he will not. The amendment is ambitious and would give clarity to the consumer and local people about what they should expect.

I understand what the Minister said about the amount of money given to local people being legislated for in secondary legislation, but there is a question about why he will not put that into primary legislation. He could be clear—the £250 a year was clearly leaked to the press a few months ago—but the Government have still not produced any legislation to give certainty to the consumer. That is symptomatic of the Government: in lots of areas of the legislation, they simply have not provided any detail to the people it affects. We will get to those other examples later, when we come to the specific issue of planning reform.

The hon. Member for Basingstoke seems to have an encyclopaedic knowledge of Opposition politicians’ quotes; I suggest that the Whips Office makes more use of him, given his ability to get an Opposition quote quickly, just like that. He might want to get a hobby, I don’t know, but he is good on quotes.

--- Later in debate ---

[The Chair]

Before we move on to the next clause, I remind Members that, although I recognise the importance of the principle and the discussion of community compensation and benefits, we need to press on and get through our agenda of line-by-line scrutiny. It is important to discuss the principles, but please also remember that we have a very long agenda in front of us.

Clause 23

Electricity transmission systems: extension of commissioning period

Question proposed, That the clause stand part of the Bill.

[Michael Shanks]

We come to the most exciting clause in the Bill: the offshore transmission owner, or OFTO, regime. I can see everyone is on the edge of their seats.

This is an incredibly important clause. It provides a competitive market for offshore electricity transmission, which is important because it helps us to achieve cost-effectiveness in the building and operation of offshore wind farm connections on to the national grid. The clause is part of our efforts to ensure the regime supports the UK’s continuing ambition to be a world leader in offshore wind.

The clause extends the time that wind farm developers who build their own transmission assets have to divest those assets to an independent offshore transmission owner. That time is currently 18 months and the clause increases it to 27 months. That period is known as the generator commissioning clause, or the GCC.

The clause addresses the increase in size and complexity of wind farms since the GCC was first introduced. My Department issued a call for evidence on the OFTO regime, which closed in February 2024 under the previous Government. The responses suggested that the GCC period was too short and should be extended due to the increase in the size and complexity of wind farms, which has led to an increased risk of developers experiencing technical faults, and has meant more time is required for more complex commercial negotiations.

Without the clause, we would expect to continue to see many offshore wind farms needing to request individual transmission licence exemptions, which we bring to this House for decision, if they are unable to transfer transmission assets within the current 18-month period. The vast majority of offshore wind farms entering the process since 2016 have needed to apply for one of these exemptions, with each exemption requiring a separate statutory instrument to be considered each time.

The clause is therefore expected to reduce very significantly the number of offshore wind farms requiring an exemption. The requirement for an exemption leaves wind farms at risk of shutting down, taking a source of renewable energy off the grid and endangering the UK’s energy security, which is of course something we all want to avoid. This is a technical but very important clause and I commend it to the Committee.

Question put and agreed to.

Clause 23 accordingly ordered to stand part of the Bill.

Clause 24

Use of forestry estate for renewable electricity

Question proposed, That the clause stand part of the Bill.

[Michael Shanks]

The clause enables the generation of electricity from renewable sources within the public forest estate through inserting a new section into the Forestry Act 1967.

Our public forests are a national asset, providing vital environmental, social and economic benefits. They also offer an opportunity to contribute to our clean power by 2030 mission through the development of home-grown renewable electricity proposals. The clause will support this by enabling Forestry England to undertake activity relating to both small and large-scale renewable electricity projects on the public forestry estate.

Developments may take place on both forested and non-forested land within the public forest estate. There will, however, be no reduction in size of the estate and sites will be carefully selected. These powers will see us integrating technologies including solar, hydro and wind energy into our natural landscape, accelerating progress to net zero and helping to tackle climate change.

Principles underpinning renewable energy developments include ensuring that there is no net loss of woodland area, positive habitat restoration and maintaining a sustainable home-grown timber supply. Forestry England has already developed around 40 small-scale renewable energy installations, but under current legislation any excess electricity that Forestry England generates is wasted and cannot be exported to the grid. That includes rooftop solar and biomass heating to generate energy used at their various visitor centres and offices. The new powers will allow Forestry England to export electricity generated from its own projects to the national grid.

Without this change to legislation, there would continue to be an imbalance between English activities in this space and those that take place in Scotland in connection to renewables. Public land being managed by the forestry authorities in Scotland is currently able to be used to generate renewable electricity at commercial scale. I commend the clause to the Committee.

[Paul Holmes]

I welcome the clarity in the Minister’s opening remarks on the clause. While the theory of generating renewable energy, and deriving income by selling electricity generated from renewable sources, on public forestry land is positive, several concerns need to be addressed that do not lend support to the Government’s initiative. I issue a word of warning to the Minister from experience: measures that concern public forests can be very divisive. As the previous party in government, we still have the scars on our back when it comes to forests. However, we accept that there are clear precedents in Scotland for what the clause will do.

I have a couple of questions for the Minister on these very well intentioned measures. Again, there is a need for clear consultation with people who live locally. We accept that these forests are run by experts, and we pay tribute to them for the way in which they run our forests across the country, but there will be people who have an absolute passion for our forests. Believe me: we saw them in our inbox when I worked for an MP. We need some clarity on that.

My first question is how the powers will balance commercial activity with conservation duties. The Minister said that there are examples of where we have done that before. It is a genuine question. We must make sure that when there is a drive to allow this to happen, some of the conversation elements are not lost in the management of the forests, and that renewable projects do not undermine biodiversity, recreation or climate resilience.

Secondly, what criteria will determine when ministerial consent is required for projects? As I am sure we agree, clear thresholds are necessary for consistency and community confidence. Within that, there must be consultation of local people. As I said, it can be an incredibly emotive topic when people find out from their local forestry commission that it is engaging in some electricity generation. When it comes to our beautiful forests, such wording can mean that people need to be told about it properly and consulted properly. What is the Minister doing to ensure that that will be at the forefront of these projects? As I said, we have been there before.

Does the Minister have any concept of how income from renewable generation will be managed? Oversight mechanisms will be vital to ensure transparency and accountability in these commercial activities. Are there limits on the scale or type of renewable projects on public land to prevent industrial-scale developments, and how will local communities be engaged in decisions affecting their access to public land?

While the clause offers opportunities, it poses risks that need careful management, so I urge the Government to provide more details to ensure that the powers are used responsibly, and that there is no mission creep at the end of the day from this very well intentioned clause.

[David Simmonds]

My great-grandfather spent his entire working life at the pit in Cwmcarn, which is now a forestry commission site. There is evidence of the coal that was dug for centuries on that site, which is now a place that is enjoyed for leisure by all. Broadly, I echo the comments about welcoming the clause.

On page 35, line 20, the excluded types of fuel are listed, to determine what may be considered to be renewable. Waste to energy is not included; nor is the sustainable fuel mandate, which is currently focused on aviation fuel, but ultimately involves producing a gasoline product entirely from waste the purpose of which is to create energy. The fuel may go into aircraft, but it could be used for other purposes. The concept of waste to energy means, essentially, building an incinerator on forestry land to burn waste and generate electricity. By implication, that is something that the Government envisage as a result of that subsection. Could the Minister say more about that?

[Michael Shanks]

I thank all hon. Members for their contributions. The hon. Member for Hamble Valley has taken the right tone, which is that our forestry land is to be treasured and protected for future generations, but there is a balance to be struck—we strike it every day in relation to how much the public can access and enjoy that land, and use visitor facilities. Stewardship of our forestry land is the responsibility of all of us. I thank him for his remarks.

We expect the footprint from the projects to be incredibly small. In fact, the most successful projects in Scotland are often on the rooftops of visitor centres, alongside toilet blocks, and in those sorts of places, so we are not talking about cutting down huge areas of forest to build ground-mounted solar. However, the point the hon. Gentleman made about consultation is critical. There will be comprehensive public and statutory consultation, and I fully expect Forestry England to carry out an even more detailed engagement process, given its stewardship role for certain pieces of land.

In fact, in Scotland, where some projects have been carried out, groups of people who frequently use the forest have been involved in designing the projects and deciding what the money will be spent on. There are real benefits to that. Although there is sometimes short-term disruption from construction, often the projects have resulted in accessible routes being opened in Scottish forests, including new wheelchair-accessible paths, so previously inaccessible land is being made accessible. However, the hon. Gentleman is right about consultation.

On the subject of revenue stream, we expect the measures to enhance Forestry England’s wider role and its existing objectives, which do not shift as a result of the measures. Of course, those objectives relate to environmental conservation. In fact, the revenue, which is currently being wasted—the critical point is that these projects cannot export to the grid—could actually create a net benefit, and we would expect it to do so. That is an important point, as is the issue of mission creep. We will certainly keep that in mind.

[Paul Holmes]

The Minister has satisfied me with his answers and is adopting a constructive tone regarding the clause, but I want to press him on the criteria used to determine ministerial consent. He is right to say that we do not want mission creep, and that we would usually expect minimum amounts of development around visitor centres and in the existing infrastructure of forests. Can he outline where the Government might set, not necessarily restrictions, but additional criteria regarding the size and scale of energy projects under the clause?

[Michael Shanks]

Again, there is a balance to be struck: we do not want to create a fixed set of national guidelines that preclude larger scale projects that would not disrupt existing forestry. I do not want to suggest that every piece of forestry land is the same, and therefore that the guidelines should apply in the same way. None the less, the hon. Gentleman makes an important point, and I will write right to the Committee about it.

I say the same to the hon. Member for Ruislip, Northwood and Pinner. As I think he would expect, schemes such as those he mentioned are not intended to be part of these measures However, I will consider whether we can tighten the guidance. The clause is intended to be about using land that, in some cases, already has some of these projects on it, but they cannot export to the grid. Small-scale solar or hydro—those are the sorts of schemes that we see as fitting alongside the wider mission of Forestry England. The hon. Gentleman raised an important point, and I am happy to write to the Committee about it.

Question put and agreed to.

Clause 24 accordingly ordered to stand part of the Bill.

Clause 25

Fees for certain services

Planning and Infrastructure Bill (Twelfth sitting)

Michael Shanks Excerpts

Committee stage
Tuesday 20th May 2025 Public Bill Committees

[The Chair]

I am sorry, but I have had no instruction about that. There has been no mention of it.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

I am standing in as both Energy Minister and a Whip, Ms Jardine. As far as I know, the assumption was that we would have made speedier progress on various clauses today, and might have concluded line-by-line scrutiny by 4 pm. I do not think it was agreed that we would adjourn at 4 pm, but I am not party to any of those conversations, so I am afraid I cannot help. I think all other hon. Members have 5 pm in their diaries—and, given the lack of progress that we have made, we probably should proceed.

[David Simmonds]

Further to that point of order, Ms Jardine, I accept that it was a discussion between me, as the Opposition Whip, and the Labour Whip yesterday, which is the usual channel through which times are agreed. That being the case, and in her absence, I will not move the adjournment, in order to enable the Committee to proceed. However, I respect that hon. Members may have to leave—including me, because I have built my diary around that agreement and I have childcare responsibilities.

[The Chair]

To clarify, the Committee sits until the Government moves the adjournment, so it is entirely up to the Government as to what they wish to do.

[Michael Shanks]

In all our diaries, the session was from 2 pm until 5 pm. That is when the Government will adjourn.

[The Chair]

We will continue; I believe the hon. Member for North Herefordshire was speaking.

Planning and Infrastructure Bill (Thirteenth sitting)

Michael Shanks Excerpts

Committee stage
Thursday 22nd May 2025 Public Bill Committees

[Olly Glover]

Once again, it is a pleasure to serve under your chairship, Ms Jardine.

I have moved new clause 10 and will speak to new clause 31, both tabled by the Liberal Democrats. New clause 10 would require solar panels to be provided on all new car parks and new clause 31 would create a scheme to provide financial incentives to homeowners and car park owners who install solar panels on their properties.

Clearly, the main driver of the new clauses is the climate change challenge that we face but, as I said previously in Committee, it is not just a challenge, but an opportunity: embracing more solar power generation enables us to become more self-sufficient in energy generation, and homeowners and others to reduce their energy bills. That is a good example of something that helps people, planet and economy.

New and existing car parks could provide 11.4 GW of solar capacity, which would go a long way towards reaching the Government target of 70 GW of solar by 2035. If land is already being used for a car park, why not make more use of that land and generate renewable energy? Generating energy close to where it is used means fewer energy losses, which is more efficient and makes the energy cheaper to the end user. That is an example of the sort of local electricity grids that we need to move towards in the 21st century of power generation.

Existing and new car parks, and non-domestic roofs between 50 kW and 1,000 kW, have costs comparable to solar farms, and so could be similarly economically attractive. Solar farms are predominantly rural and can require extensive planning permission and additional construction costs due to location, such as long-length cables and large transformers. Car parks also provide the opportunity to use the energy generated directly to charge electric vehicles, thereby relieving pressure on the grid and making driving electric vehicles more attractive. The Government have been clear about their aspiration for us to move to electric vehicles as standard.

In 2022, France introduced similar legislation to that which we are proposing, and it took effect in 2023. The French Government calculated that the measure will result in a capacity of between 6.75 GW and 11.25 GW. For context, Drax, the UK’s largest power station, has a capacity of between a quarter and a half of that, at just 2.6 GW. If not mandated, incentivising such schemes should be the minimum requirement. We are not using car parking space to its full potential, so I hope that the Minister will seize the opportunity to change that by supporting the new clause.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

It is a pleasure to see you in the Chair, Ms Jardine. I have missed our Wednesday “Politics Scotland” soirées, so it is nice to be with you again. I will begin by speaking to new clause 10. I was going to speak to new clause 31 as well, but I do not know whether anyone intends to move it.

New clause 10, which was tabled in the name of the hon. Member for Taunton and Wellington, would require the provision of solar panels on at least 50% of the surface area of above-ground car parks. I appreciate what the hon. Gentleman is proposing, and we share his ambition. Indeed, in the “Clean Power 2030 Action Plan”, which we published just before Christmas, we outlined the pathway to achieving a clean power system. Solar photovoltaic deployment is a key component of that, and through the plan we hope to increase solar output from 18 GW to between 45 GW and 47 GW by 2030.

We were very clear in the plan that we saw solar PV as a real opportunity, but we also stated our intention to gather evidence on the potential of putting solar canopies on car parks. As the hon. Member for Didcot and Wantage pointed out, although that principle seems entirely sensible and something that I would entirely agree with, there are some details that we would want to work out on how it could be delivered and the economics of it. That is why we are consulting right now. Our call for evidence is open on the potential for mandatory installation of solar canopies on new car parks, and indeed on increasing the potential for solar on current car parks. It is important that we properly engage with industry on this question, particularly on the economics of how it could be delivered because we want to be really clear on the impact that it could have on car parks and of course on the users of car parks if costs are passed on.

I assure both hon. Members that we are in favour of the idea. Fundamentally, we want solar to be part of our pathway to clean power. If it can be deployed on the rooftops of industrial buildings, car parks, warehouses or any rooftop we can use, that clearly is the best and easiest way to do it, but we want an adequate evidence base before we do that. For that reason, we will not support the new clause, but I hope the hon. Member for Didcot and Wantage appreciates that we broadly agree with the general direction that he is proposing.

Planning and Infrastructure Bill (Fourteenth sitting)

Michael Shanks Excerpts

Committee stage
Thursday 22nd May 2025 Public Bill Committees

[Gideon Amos]

New clauses 98 and 99 would require the Government to review permitted development rights and land acquisition rights for the electricity distribution network. The electricity distribution network is about 200,000 kilometres of bending overhead lines. If we are going to deliver net zero and economic growth, the anomalies now appearing in the system need to be addressed. There is a massive challenge for us in delivering more local renewable energy installations, as more farmers want batteries and more people want solar panels on their roofs.

The stress on the distribution network is significant—the Minister will know a lot more about this than I do—and we need to upgrade our distribution network as rapidly as possible. That reminds me of a seminar I once organised, when someone from National Grid said, “You can tell the road with all the solar panels on the roofs by the substation on fire at the end of it.” We really need to find a way to resolve the overloading of the distribution network, which can pose risks—though hopefully not fires—and challenges to those trying to upgrade their local network.

I have a couple of examples. Where there is a row of poles with two cables on them going across a field, just to put a third cable on there requires a planning application. When we are dealing with hundreds of thousands of kilometres of electricity line, that seems overly rigorous and constrained. Similarly, if someone wishes to increase the height of the poles by more than 10%—let us say they want to increase them by 12%—that would require a full planning application process. We hope these new clauses are self-explanatory in their aim of to moving us closer and faster towards delivering on communities’ net zero ambitions.

I have growing confidence that the Government will accept these new clauses without any further debate—but I have always been an optimist. I look forward to the Minister’s comments.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

I hate to let the hon. Gentleman down at this hour of the Committee, but I will outline why we cannot accept his new clauses. I think he will, however, be pleased with the Government’s position on this. I will turn first to new clause 98, which requires the Government to consult on the implementation of measures to give distribution network operators powers in relation to the acquisition of and access to land.

First, we completely agree with the case that the hon. Gentleman outlined. The distribution network does the vast majority of the heavy lifting to get electricity to all our homes and businesses, and it plays a critical role. It will require significant upgrading over the coming years, not least with the increase in demand that we expect. We agree that the current regime for infrastructure is not fit for purpose, as do developers and landowners.

We are all in agreement, which is fantastic at this hour of the Committee. The reason I cannot support this new clause is that we want to propose—if I may say so—a more ambitious set of reforms to land rights and consenting processes later this year. While we agree with the principle of many of the proposed changes, it is important that we get their detail right and ensure that they are developed with particular consideration of the rights of landowners. We will consult on reforms in this area, and following that consultation, we will look at including appropriate measures in future legislation, where necessary.

[Gideon Amos]

I wonder whether the Minister could be a little more definite. He referred to future legislation and some time this year, but I cannot help but think that I have heard those phrases before on some other topics. Is there a concrete proposal to bring forward legislation in this area?

[Michael Shanks]

A working group, involving people from across the Department and all those involved in this area, has been working on these proposals, and a consultation will be brought forward shortly. In the King’s Speech, we committed to a Bill that addresses a number of different areas in the energy space, and we hope that this area could be included. However, it is necessary to complete the consultation process in order to know what those measures might look like.

On new clause 99, I broadly agree with the thrust of what the hon. Gentleman has raised. Reform is necessary for us to meet the increasing demand for clean energy, and upgrading the distribution network will play a crucial role, particularly in connecting small-scale renewable energy technologies such as solar and wind, as well as the widespread adoption on the demand side, which we do not often speak about, with the roll-out of electric vehicles and heat pumps. Without upgrades in this space, we risk falling short of our climate goals and hindering progress towards our sustainable future.

While we are in complete agreement with the hon. Gentleman on the need for change, we do not support this particular new clause because it is possible for us to complete many of these changes through secondary legislation. As with new clause 98, it is also crucial that landowners’ views are heard and understood before any of these changes are implemented. We may wish to consider other reforms as part of this process or to discount certain proposals based on the evidence from those relevant stakeholders. That is why the Government have committed to consult on these and other reforms in the summer. That is the most appropriate way forward, rather than the Planning and Infrastructure Bill. I hope the hon. Gentleman will withdraw new clause 98.

[Gideon Amos]

I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 101

Preservation of playing fields and pitches

“(1) A local planning authority must, when exercising any of its functions, ensure the preservation of playing fields and playing pitches.

(2) The duty in subsection (1) may, when granting permission for development, be met through the imposition of conditions or requirements relating to—

(a) the protection of playing fields or playing pitches affected by the development; or

(b) the provision of alternative, additional or expanded playing fields or playing pitches.

(3) For the purposes of this section, ‘playing fields’ and ‘playing pitches’ have the same meanings as in the Town and Country Planning (Development Management Procedure) (England) Order 2010.”—(Gideon Amos.)

Brought up, and read the First time.

--- Later in debate ---

[Olly Glover]

I beg to move, That the clause be read a Second time.

The new clause would make the adoption of local area energy plans compulsory in England. Local area energy plans are now recognised as the leading method for turning national net zero targets into real, on-the-ground action. They offer a path that is not only strategic and data driven but collaborative and cost-effective.

The plans are driven by local government, working hand in hand with key stakeholders from across the community. The result is a fully costed spatial plan that lays out exactly the changes needed to the local energy system and the built environment. Critically, it includes not just what needs to happen but where, when and by whom it should be delivered. Moreover, local area energy plans break down the big picture into manageable steps. They map out the costs, shifts in energy use and reductions in emissions over time. Such plans can be prepared to align with our national climate goals, including ultimately reaching net zero by 2050.

I am proud to say that in Oxfordshire, where my constituency is, a local area energy plan is under development. However, despite their importance to our planning process and net zero target, such plans are not compulsory in England. That has not stopped many local authorities from preparing them, and I hope that the Government will note that many of those local authorities are controlled by the Labour party. In Greater Manchester, 10 boroughs have a local area energy plan in place. Plans are also in place in York and North Yorkshire, Cornwall and the Isles of Scilly, Peterborough and the borough in which we are holding this debate: Westminster. In Wales, all 22 authorities have produced a local area energy plan because in Wales that is compulsory.

If hon. Members do not believe me, I quote Shaun Gibbons, the head of carbon reduction at York city council:

“The York Local Area Energy Plan has served an important role in articulating the scale of the net zero challenge and setting specific targets against some of our most pressing actions. It has provided a robust evidence base for external funding applications and has resulted in the Council accessing funding several times greater than the original cost of the plan.”

The new clause would require local authorities to prepare local area energy plans and would be a key component in getting to net zero. In the final stages of this Committee, I have hope that the Minister will view the measure favourably, given that there is so much good practice from Labour-run councils.

[Michael Shanks]

I thank the hon. Member for Taunton and Wellington for tabling the new clause, and the hon. Member for Didcot and Wantage for speaking to it—and for his praise of Labour councils, which we are always happy to hear from colleagues across the House. I recognise the important work and example of local area energy plans where they are working.

Local authorities are taking a number of other actions right across the country to deliver net zero, many having drafted strategies in different ways and forms to achieve their own local aims, goals and ambitions alongside other strategies that local authorities might have. These are helpful documents to be able to refer to when planning for forthcoming energy projects and investment.

We support the idea that local authorities may wish to look at these kinds of plans as part of the wider context around, for example, local growth plans. However, our view on the new clause is that now is not the right time to place an additional burden on all local authorities to have to develop local area energy plans—during a period of local government reorganisation, and crucially, as we are taking forward the regional energy strategic plans process, which is under way at the moment.

A top-down requirement for a local area energy plan would risk duplicating local and regional energy system planning that the National Energy System Operator is carrying out in line with Ofgem’s recent decision to introduce regional energy strategic plans. Ofgem has set out that regional energy strategic plans will plan how local energy systems need to be developed to reach net zero, considering the national targets set by central Government, and, as part of the strategic planning of our energy system more generally, the local needs and most appropriate approach in each area. They will set out the energy requirements for each region presented spatially. They will also set the foundation for determining capacity required and strategic investment needs on a regional basis.

Ofgem has stated that the National Energy System Operator will set up regional strategic boards, which will be responsible for providing oversight of regional energy plans, and it is anticipated that local government will be properly represented on those boards. We want local government to play an active role in the development of the regional energy plans. I understand that the work that many of them have been doing already, the evidence they have gathered and the experiences that they have had will be hugely helpful in supporting this process. The exact format of how each local government will contribute is still to be decided. Given that that process is ongoing and the huge amount of work as part of the strategic spatial energy plan and the regional plans, now is not the right time to place a new burden on local government to provide a uniform product across the country.

Finally, given that many areas have multiple tiers of local government, the new clause risks a number of different duplicative plans covering the same geographical area. For those reasons, although I completely support the premise of the point about the importance of local participation in planning the energy system, we will not support the new clause.

[Olly Glover]

I thank the Minister for his comments. It is good to know from him that the topic is being looked at with a geographical scope greater than single local authorities. We shall observe with interest how that goes. In the interests of having time to speak to other new clauses, I will not press this one to a Division. I beg to ask leave to withdraw the clause.

Clause, by leave, withdrawn.

New Clause 105

Extension of use classes C5 and C6 to England

“In article 1(2) of the Town and Country Planning (Use Classes) (Amendment) (Wales) Order 2022, after “Wales” insert “, except in relation to articles 2(e) and 2(f), which apply in relation to England and Wales”.”—(Gideon Amos.)

This amendment of existing regulations would extend use classes C5 (Dwellinghouses, used otherwise than as sole or main residences) and C6 (Short-term lets), which currently only to apply to Wales, to England.

Brought up, and read the First time.