Tue, 17 Oct 2017
Devolution of power: the impacts of devolution on the delivery of new infrastructure
Devolution of powers to Wales and the impact of the Wales Act 2017
1. The Wales Act 2017 received Royal Assent on 31 January 2017. Some provisions are already in force; others will come into effect in April 2018.
2. The ‘devolution model’ for Wales is changing. The current devolution settlement is based on a ‘conferred powers’ model. Schedule 7 of the Government of Wales Act 2006 sets out the 21 devolved “subjects” for which, subject to the exceptions set out in the schedule, the Assembly can legislate. Everything else falls to the UK or European Parliaments. Areas devolved to Wales include, amongst other things, the environment, agriculture, fisheries, planning and energy. Development Consent under the Planning Act 2008 is expressly excluded from the devolved subject of “Town and Country Planning”. The “generation, transmission, distribution and supply of electricity” is excluded from the devolved subject of “Economic Development”
3. Under existing devolved powers the Assembly has recently passed three key pieces of legislation in relation to the environment in Wales; the Environment (Wales) Act 2016 (areas including the sustainable management of natural resources, climate change – including emission targets, charges for carrier bags, collection and disposal of waste, marine licensing) and the Planning (Wales) Act 2015 ( areas including strategic and local development plan making, consent for Developments of National Significance, development management and enforcement process and procedure, town and village greens). At present all laws passed by the Assembly must comply with EU law which is of particular relevance for the environment as many policy areas are shared with the EU including agriculture, through the Common Agricultural Policy, and nature conservation, via the Birds and Habitats Directives.
4. The Wales Act 2017 introduces a ‘reserved powers’ model of devolution. This turns the ‘conferred powers’ situation on its head; it sets out the areas outside the Assembly’s legislative competence, leaving everything else devolved to Wales. This is more similar to the situation in Scotland. The new model is due to come into force in April 2018.
5. Apart from new powers to consent energy projects (which we look at below), Wales Act 2017 brings new powers to Wales in the field of energy and the environment:
- Responsibility for marine licensing in the Welsh ‘offshore region’– 12 nautical miles out to the median line (currently limited to the ‘inshore region’ – 0-12 nautical miles);
- Power to designate areas in the Welsh offshore region as Marine Conservation Zones (MCZs) (limited to the inshore region currently- Skomer is the only existing Welsh MCZ);
- Power to consent energy projects with a generating capacity of up to 350MW for both onshore and inshore energy extending the current 50MW limit for the onshore and 1MW limit for the inshore. This would include the planned tidal lagoon in Swansea Bay. Onshore wind projects will continue to have no upper limit;
- Responsibility for licensing onshore oil and gas, including the extraction of shale gas, and for new coal mines;
- Power of consent for ‘associated development’ for energy projects, for example transport links and overhead power lines to the same body that is responsible for the main project;
- Power to make building regulations in respect of ‘excepted energy buildings’ – buildings that form part of energy infrastructure; and
- Additional power to legislate over water supply and sewerage.
6. In September 2017 the Welsh Government published is national strategy “Prosperity for All”, setting out its key priorities for the rest of the Assembly’s term. The document says that the "right planning system" is "crucial" for delivering the objectives contained in the strategy.
7. It says that the Welsh government will introduce a new National Development Framework, "setting out a 20-year land use plan for Wales, guiding strategic development and supported by the National Infrastructure Commission for Wales". The new commission will "strengthen the governance and strategic planning of major infrastructure investments". The document also pledges to establish a "bespoke infrastructure consenting process, which is responsive to business and community needs, to support sustainable economy growth, and to decarbonise our energy supply". It adds that the Welsh government will tackle “regional inequality”, promote integration of services and require "coordinated planning of new homes, facilities and infrastructure by local authorities, health bodies, housing associations and other key partners".
8. The very recently published Mobile Action Plan sets out proposed changes to national planning policy and a commitment to considering amendments to permitted development rights to “maximising mobile phone coverage across Wales". The mobile industry has "made it clear that changes to permitted development rights including to the size of mobile masts, antenna size and emergency access to infrastructure sites will make the process of deploying new mobile infrastructure and upgrading existing infrastructure quicker and easier". The plan goes on to say that the introduction of the National Development Framework "represents an opportunity to ensure that digital infrastructure is at the heart of planning in Wales" and "revise and, if appropriate, consolidate” TAN 19, which outlines the planning procedures that councils should follow when assessing telecommunications proposals, as well as the Mobile Phone Network Development code of best practice.
What does the new devolution deal mean for new energy schemes?
9. At present energy schemes are consented as follows:
a. Up to 10MW – by the local authority
b. Between 10MW and 50MW – by Welsh Ministers under the Developments of National Significance (“DNS”) system set up under the Planning (Wales) Act 2015.
c. Over 50MW – by the Secretary of State in Westminster under the Planning Act 2008 NSIP system. However, the Secretary of State is not able to give consent for any associated ancillary development to those Welsh projects large enough to fall under the NSIP regime. This meant that projects like the Swansea Bay Tidal Lagoon had to run parallel planning applications to Welsh authorities and the NSIP regime, causing delays.
d. The 2016 Energy Act took planning for onshore windfarms only above 50MW out of the NSIP regime, allowing them to also be determined under the DNS system.
10. Under the 2017 Act scheme energy schemes will be consented as follows:
a. All energy projects (onshore, in Welsh territorial waters and in the Welsh zone) under 350MW will be decided in their entirety in Wales.
b. Smaller onshore projects up to 10MW will remain within the purview of the local authorities.
c. Those over 10MW but less than 350MW will be determined by Welsh Ministers under the DNS process that can also determine associated development.
d. Applications for projects above 350MW in size that remain under the UK government’s NSIP regime will finally be able to include associated development.
11. What does all this mean for project delivery? It is obviously too early to say, but ‘received wisdom’ includes the following:
a. Welsh Ministers are seen as being more sympathetic to renewable power, and particularly onshore wind developments, so the shift to Welsh jurisdiction could be a significant ‘de-risking’ of investment. At present even if the Welsh Government was sympathetic, developers still face the risk that UK ministers would not be.
b. The hope is that more renewable energy projects will be encouraged in Wales and it will be easier for Welsh Government to support sustainable energy projects.
12. The DNS consenting system is going to need ‘tweaking’ to deal effectively with the larger projects. Although the system is based / modelled on the NSIP regime, it has some key differences.
a. It is not a complete "one-stop shop" for all necessary permissions in the same way as a DCO issued under the NSIP regime. Some environmental permitting and compulsory purchase powers are excluded.
b. The DNS system was set up to determine applications quickly, within 12 months of submission. This pace is achieved by allowing very few changes to the application once the process has been started, and by requiring a full detailed planning application to be both consulted upon, and submitted up front. For projects approaching the 50MW threshold this is very challenging. The lack of any type of "outline" application stage means a huge amount of work has to be done at risk by developers before the official process starts. Experienced promoters say this needs to change”.
c. The requirement to consult upon a detailed planning application, combined with the inability to make material changes to an application once in the system, seems likely to make it hard for promoters to demonstrate that they have formulated plans in response to feedback. In practice it seems likely that there will have to be an informal round(s) of consultation. But it might be difficult if statutory consultees are not obliged or willing to engage early in the process.
13. As already noted, in Prosperity for All the establishment of a “a bespoke infrastructure consenting process which is responsive to business and community needs" is promised.
14. There is also issues relating to the current decision-taking framework. Decisions under the NSIP regime are taken against the relevant National Policy Statement (NPS); decisions under the DNS process are supposed to be taken in the context of the forthcoming National Development Framework for Wales. However, this does not yet exist, and while the Welsh government has started the process of drawing it up, it is not expected to be complete until at least 2019. In the meantime, decisions can be taken with reference to local planning policies and relevant NPSs, but this may make life more complicated for larger schemes in particular. This could lead to developers delaying submission of projects.
15.The recent announcement that Planning Policy Wales will be “refreshed” through consultation by Spring 2018 adds to the uncertainty of the future policy landscape.
Associated developments – how to align different consenting processes
16. Section 43 of the Wales Act 2017 amends s115 of the Planning Act 2008 to enable the Secretary of State to grant a DCO that includes associated development for energy generating stations (ie above 350MW under the new regime). For this sized scheme consenting processes for “associated development” will be aligned.
- Under the current DNS regime, the Welsh Ministers’ powers include granting “secondary consents” which include section 2(3) of the Ancient Monuments and Archaeological Areas Act 1979 (control of works affecting scheduled monuments); section 178(1) Highways Act 1980 (restriction on placing rails, beams etc over highways); section 8(1) of the Planning (Listed Buildings and Conservation Areas) Act 1990 (authorisation of works: listed building consent); section 74(1) of the Planning (Listed Buildings and Conservation Areas) Act 1990(control of demolition in conservation areas); section 4(1) of the Planning (Hazardous Substances) Act 1990 (requirement of hazardous substances consent); section 13 of the Planning (Hazardous Substances) Act 1990(application for hazardous substances consent without condition attached to previous consent); section 17 of the Planning (Hazardous Substances) Act 1990 (revocation of hazardous substances consent on change of control of land); section 57(1) of the Town and Country Planning 1990 Act (planning permission required for development) other than outline planning permission; section 247(1) of the 1990 Act (order authorising stopping up or diversion of highway); section 248(2) of the 1990 Act (order authorising the stopping up or diversion of highway crossing or entering route of proposed new highway); section 251(1) of the 1990 Act (order extinguishing public rights of way over land held for planning purposes); section 16(1) of the Commons Act 2006(12) (deregistration and exchange: applications); section 38(1) of the Commons Act 2006 (prohibition on works without consent).
18. Applications for all other consents / authorisations / orders need to be made under the appropriate consenting regimes.
19.Where Welsh Ministers have the final decision-making function, obviously applications can be aligned so that they are consented at the same time. Where Ministers rely on reports from Inspectors, then the same inspector can be appointed to inquire into and report on the matter. However, there may be ‘problems’ where an applicant for planning permission for an DNS does not itself have power to make a compulsory purchase order for confirmation by Welsh Ministers. In such circumstances the CPO application will have to be made by a sympathetic public body that does have CPO powers.
20. Where a local planning authority is the appropriate decision-taker (at least in the first instance), it is to it that applications for associated development must be made.
21. This gives rise to a ‘chicken and egg’ dilemma: should I wait for the DNS consent before applying for those other consents for associated development? How that dilemma is resolved will be dependent on a number of factors:
a. The budget – what is the developer prepared to ‘risk’ in potentially ‘wasted’ expenditure?
b. The deadline for funding or delivery – do all consents need to be in place by a certain date?
c. How long will each take to obtain – allowing for pre-application discussion, consultation, decision-taking and any appeal?
d. Are any consents dependent on other consents already being in place?
e. Are any consents dependent on the evidence base for other consents?
22. The answers to these questions will enable a ‘gant chart’ to be drawn up aligning the various consents needed.
Is further devolution of powers needed?
23. This begs the question “needed for what”?
a. To deliver a bespoke Welsh agenda?
b. To ensure more decisions are made in Wales?
c. To avoid unnecessary expense?
d. To ensure timely delivery?
24. Under the ‘reserved powers’ model of devolution, the following are reserved in schedule 7A of the Wales Act 2017 and therefore potentially available for further devolution:
96 Generation, transmission, distribution and supply of electricity.
D2 Oil and gas
97 Oil and gas, including—
(a) the ownership of, exploration for and exploitation of deposits of oil and natural gas,
(b) pipelines and offshore installations,
(c) marine licensing and the regulation of works that may obstruct or endanger navigation, so far as relating to oil and gas exploration and exploitation,
(d) restrictions on navigation, fishing and other activities to ensure safe operation of offshore activities,
(e) liquefaction and regasification of gas,
(f) the manufacture or production of gas, and
(g) the conveyance, shipping and supply of gas.
· The granting and regulation of licences to search and bore for and get petroleum that, at the time of the grant of the licence, is within the Welsh onshore area, except for any consideration payable for such licences.
· Access to land for the purpose of searching or boring for or getting petroleum under such a licence.
· Marine licensing and the regulation of works that may obstruct or endanger navigation, so far as relating to searching or boring for or getting petroleum under such a licence.
· “Petroleum” means petroleum within the meaning given by section 1 of the Petroleum Act 1998 in its natural state in strata.
· “Welsh onshore area” means the area of Wales that is within the baselines established by any Order in Council under section 1(1)(b) of the Territorial Sea Act 1987 (extension of territorial sea).
98 Coal, including—
(a) the ownership and exploitation of coal,
(b) deep and opencast coal mining,
(c) subsidence relating to coal mining, and
(d) water discharge from coal mines.
· Land restoration.
D4 Nuclear energy
99 Nuclear energy and nuclear installations, including—
(a) nuclear safety, security and safeguards, and
(b) liability for nuclear occurrences.
100 The Office for Nuclear Regulation.
D5 Heat and cooling
101 Production, distribution and supply of heat and cooling.
· Heat and cooling networks, but not the regulation of them.
· Schemes providing incentives to generate or produce, or to facilitate the generation or production of, heat or cooling from sources of energy other than fossil fuel or nuclear fuel.
· “Heat and cooling network” means a system or network by which steam, hot water or chilled liquid is distributed from a central source for supplying heat or cooling to various consumers or premises.
D6 Energy conservation
102 Energy conservation.
· The encouragement of energy efficiency otherwise than by prohibition or regulation.
M3 Development and buildings
184 Planning (including the subject-matter of Parts 2 to 8 of the Planning Act 2008) but only in relation to—
(a) relevant nationally significant infrastructure projects,
(b) overhead electric lines other than devolved associated lines, and
(c) railways other than railways that start, end and remain in Wales,
except this does not affect the reservation of the subject-matter of sections 14 and 16 of the Harbours Act 1964 by paragraph 121.
185 Compensation in respect of—
(a) the interference with rights in land by exercise of a statutory power;
(b) depreciation in the value of land as a result of works or land provided or used in the exercise of a statutory power.
186 The regulation of—
(a) the design and construction of buildings,
(b) the demolition of buildings, and
(c) services, fittings and equipment provided in or in connection with buildings,
but only in relation to specified Crown land and specified undertaker land.
· “Devolved associated line” means an overhead line that—
(a) is associated with a generating station that is or (when constructed or extended) is expected to be—
(i) in Wales or the Welsh zone, but
(ii) not within section 15(3A) or (3B) of the Planning Act 2008, and
(b) has or will (when installed) have a nominal voltage no greater than 132 kilovolts.
· “Railway” has the meaning given by section 67(1) of the Transport and Works Act 1992.
· “Relevant nationally significant infrastructure project” means a project falling within paragraph (a), (c), (g) or (j) of section 14(1) of the Planning Act 2008.
· “Specified Crown land” means land—
(a) belonging to Her Majesty in right of the Crown;
(b) belonging to Her Majesty in right of the Duchy of Lancaster;
(c) belonging to the Duchy of Cornwall;
(d) held or used by a Minister of the Crown or a government department.
· “Specified undertaker land” means land held or used by a statutory undertaker in the exercise of a statutory power that relates to a matter in paragraph 96, 97(f) and (g), 99, 117, 121 or 125.
25.Section 14(1) of the Planning Act 2008 provides (with reserved or part-reserved sub-sections underlined):
Nationally significant infrastructure projects: generalE+W+S
This section has no associated Explanatory Notes
(1) In this Act “nationally significant infrastructure project” means a project which consists of any of the following—
(a) the construction or extension of a generating station;
(b) the installation of an electric line above ground;
(c) development relating to underground gas storage facilities;
(d) the construction or alteration of an LNG facility;
(e) the construction or alteration of a gas reception facility;
(f) the construction of a pipe-line by a gas transporter;
(g) the construction of a pipe-line other than by a gas transporter;
(h) highway-related development;
(i) airport-related development;
(j) the construction or alteration of harbour facilities;
(k) the construction or alteration of a railway;
(l) the construction or alteration of a rail freight interchange;
(m) the construction or alteration of a dam or reservoir;
(n) development relating to the transfer of water resources;
(o) the construction or alteration of a waste water treatment plant;
(p) the construction or alteration of a hazardous waste facility.
(2) Subsection (1) is subject to sections 15 to 30.
Martin Kingston QC (Retired)
Email: [email protected]