Major project retreat buys time for promoter strategy regroup

It is not every week that two of the country's biggest infrastructure projects get stalled.

E.ON's plans for a coal-fired power station at Kingsnorth and BAA's third runway at Heathrow Airport have always been guaranteed to light a blue touch paper. Protesters have made a huge impact and inflicted enormous damage on the reputations of proponents and ministers alike.

But before environmentalists and local communities pop the champagne corks, a word of caution. These Dracula schemes may well come back to life. It is far too early to see the decisions to delay them as a turning point in the effectiveness of environmental activism. The economic climate is as much responsible for their deferment as the widespread outrage they provoked.

For E.ON, the figures simply did not add up. Energy demand has dramatically fallen during the recession. Carbon capture and storage technology has yet to prove itself and requires substantial public subsidy. The government competition to develop the technology has progressed with all the urgency of a giant turtle. Nevertheless E.ON will tentatively reconsider Kingsnorth, possibly within three years.

For its part, BAA has agreed not to lodge a planning application before the general election. It remains committed to a third runway and argues that submission to the Infrastructure Planning Commission was always going to wait until after the election, regardless of who wins it. Of course, the Conservative administration waiting in the wings is implacably opposed to Heathrow expansion - for the time being.

If we have learnt one thing over the past 12 years, it is that governments change their minds, not least after the type of intense behind-the-scenes lobbying to which New Labour has been all too ready to capitulate. If the Tories win, this will be a true test of their credentials. In the meantime, BAA's decision nudges open the door for the government to hold a proper review of the nation's transport priorities rather than opting for unbridled airport growth. It is unlikely to have any appetite for that.

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