Why the business secretary overruled an inspector's recommendation and approved a gas-fired power plant

A minister's approval of a gas-fired power plant against an inspector's finding potentially conflicts with the government's commitment to its net zero carbon target, say some experts, who also suggest the decision illustrates the need for an overhaul of the eight-year-old energy national policy statements.

Drax: gas plant plan approved (pic: Tim Dennell, Flickr)
Drax: gas plant plan approved (pic: Tim Dennell, Flickr)

Earlier this month, energy secretary Andrea Leadsom granted a development consent order (DCO) for a new gas-fired power station plus battery storage at the Drax Power Station near Selby in North Yorkshire. What made the decision notable is that it was one of just six occasions when a minister has gone against the recommendation of the Planning Inspectorate when determining Nationally Significant Infrastructure Projects (NSIPs).

In recommending refusal of the project, the Planning Inspectorate said approval would "undermine the government’s commitment…to cut greenhouse gas emissions". This, it said, meant the applicant had not demonstrated the need for gas generation capacity when assessed against the "overarching policy objectives of security of supply, affordability and decarbonisation" outlined in the four relevant national policy statements (NPSs) on energy infrastructure.

However, Leadsom rejected this argument, stating that "the government’s policy and legislative framework for delivering a net zero economy by 2050 does not preclude the development and operation of gas-fired generating stations in the intervening period". She said the overarching NPS for energy does not state that "greenhouse gas emissions are a reason to withhold the grant of consent for such projects". The letter concludes: "It is open to the secretary of state to depart from the NPS policies and give greater weight to greenhouse gas emissions in the context of the Drax application, but there is no compelling reason to do so in this instance."

John Rhodes, director at planning consultancy Quod, said the decision "could well be sound". He said: "The examining panel appeared to want to suggest that the NPS was no longer determinative and that circumstances had changed. However, the minister appears to say that, until such time as the NPS is revised, it remains the NPS and its terms are clear."

However, Angus Walker, infrastructure planning partner at law firm BDB Pitmans, said Leadsom’s decision does undermine the government’s new net zero carbon target. He said: "Potentially, this project could produce 12 million tonnes of CO2 a year". This already equated to 10 per cent of the UK’s allowance when the previous government target of an 80 per cent reduction in emissions from 1990s levels was in place, he pointed out.

He said Leadsom’s decision letter dismissed the new zero carbon target too lightly. "She has interpreted the NPS literally and has given little weight to subsequent policy and legislative changes such as net zero. If keeping the lights on being more important than achieving net zero is political, then it was a political decision."

Rob Asquith, a planning director at consultancy Savills and a specialist in power stations and NSIP projects, said politicians have a hard task in balancing the need to tackle climate change with the employment and wealth-generating opportunities of fossil fuel schemes. Both he and Walker said it was time for the eight energy NPSs, which were published in 2011, to be reviewed given subsequent policy changes. Asquith said: "The NPSs are now all quite old and were not written at a time when the carbon debate was as central or as nuanced as it now is."

However, Rhodes said: "Applicants should be advised that the relevant NPS remains the primary policy consideration until such time as it is replaced." Walker agreed, adding that it "would appear unlikely" that an electricity-generating project would be refused under the NSIP regime for relying on carbon-emitting fossil fuels.

But Giles Pink, associate director at law firm Bryan Cave Leighton Paisner, said he did not think the Drax decision is likely to make it easier for other fossil fuel-consuming NSIP projects. "It does not necessarily follow that non-green energy projects will now receive a less tough ride," he said. "Lobbyists and campaigners will still attack such schemes in the hope of capitalising on any vulnerabilities."

How often has the secretary of state overruled the Planning Inspectorate in DCO cases?

Cases where the secretary of state overturns the recommendation of examining authorities considering DCOs are rare, according to Giles Pink, associate director at law firm Bryan Cave Leighton Paisner. Of the 79 decisions made since the introduction of the regime, he said, only six have gone against recommendations, including the Drax case. Of this six, four were refusals when the PINS examining authority had recommended approval.

2013 - Preesall gas storage project. Energy secretary Ed Davey went against the recommendation of a Planning Inspectorate panel and approved a project that involved the excavation of 19 rock salt caverns, for the storage of up to 600 million cubic metres of gas. The government was later forced to reverse its initial decision after a High Court defeat.

2015 - Mynydd y Gwynt Wind Farm. Energy secretary Amber Rudd overruled an inspector and blocked plans for a 27-turbine wind farm in Powys. She cited concerns over the effect on a special protection area for red kites and said there was an "absence of sufficient information to consider the possible environmental effects of the development".

2016 - East Midlands Gateway. Transport secretary Patrick McLoughlin approved a development consent order for the East Midlands Gateway strategic rail freight interchange, against the advice of the three planning inspectors. McLoughlin concluded "the project is substantially compliant with the NSP requirements…when they are considered as a whole".

2016 - White Rose Carbon Capture and Storage (CCS) project. Energy secretary Amber Rudd turned down a DCO application for a scheme to capture carbon emissions next to the existing Drax power station. Although examiners recommended approval, Rudd said that developer Capture Power Limited lacked the resources to build the project.

2017 - Yorkshire and Humber CCS Cross Country Pipeline. Energy secretary Greg Clark refused permission for a 75km onshore pipeline intended to transport carbon dioxide emissions to a storage site under the North Sea. He ruled that the need case for the development 'is not satisfactorily established', partly due to the previous refusal of the White Rose CCS project (see above).

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