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Miliband sets strategic direction for overhaul of UK energy system

Miliband sets strategic direction for overhaul of UK energy system

News Release issued by the COI News Distribution Service on 09 November 2009

* Six draft National Policy Statements to guide planning decisions on energy infrastructure
* Ten sites named as potentially suitable for new nuclear
* A Framework for the Development of Clean Coal

Faster and fairer planning decisions on new energy infrastructure were a step closer today as Energy and Climate Secretary Ed Miliband laid before Parliament draft texts setting out the national need for a low carbon secure energy mix. He also set out an ambitious new policy for the transition to clean coal.

The draft National Policy Statements (NPSs) published today are a crucial part of reforms that will remove unnecessary planning delays facing large energy proposals. They will be the basis on which individual planning decisions are made from next March by the new Infrastructure Planning Commission.

To meet our low carbon energy challenge, and due to the intermittency of wind, we will need significantly more generating capacity in the longer term. One third of that larger future generating capacity must be consented and built over the next 15 years to 2025. While there are already proposals to build more energy infrastructure, more is needed to bring about the shift to a low carbon future. The NPSs include clear direction towards a massive expansion in renewables, a new nuclear programme based around ten sites assessed as potentially suitable for new build and a programme to demonstrate clean coal technology.

Mr Miliband said:

"The threat of climate change means we need to make a transition from a system that relies heavily on high carbon fossil fuels, to a radically different system that includes nuclear, renewable and clean coal power.

"Change is also needed for energy security. In a world where our North Sea reserves are declining, a more diverse low carbon energy mix is a more secure energy mix, less vulnerable to fluctuations in the availability of any one fuel.

"In exploiting new technologies we can also lock green jobs and growth, not carbon, into the UK's future energy sector.

"The current planning system is a barrier to this shift. It serves neither the interests of energy security, the interests of the low carbon transition, nor the interests of people living in areas where infrastructure may be built, for the planning process to take years to come to a decision.

"That is why we are undertaking fundamental reform of the planning system which will result in a more efficient, transparent and accessible process.

"And our new policy framework for clean coal will drive the development of CCS which will be essential for reducing the impact of coal-fired power stations on the environment."

Six NPSs are published - one overarching and one for each of the following areas: fossil fuels, nuclear, renewables, transmission networks and oil and gas pipelines - alongside the Government's final Framework for the Development of Clean Coal.

The new system will be faster and fairer for everyone involved:

* Decisions on proposals bigger than 50 megawatts (or 100 megawatts for offshore wind) will be reduced from two years, sometimes much more, to one year.

* Clearer and better opportunities for the public and local communities to have their say.

* Up to £300 million a year will be saved in unnecessary expense incurred by UK industry.

Housing and Planning Minister, John Healey, who led the Planning Bill through Parliament, said:

"The course of our country's future will be set by investments in new energy sources, water supplies, ports, railways and other transport networks. The National Policy Statements do what they say on the tin - they are Britain's policy blueprints within which the Infrastructure Planning Commission will run a faster and fairer planning system, with fuller public scrutiny of larger developments.

"Instead of major projects going through, three, four, five separate applications, sometimes sequentially, there is now one single consent system, with one full expert and public examination. This includes new steps that require open public consultation before applications can even be submitted."

NEW NUCLEAR POWER

The draft Nuclear NPS sets out why new nuclear power is needed, and that the Government is satisfied that effective arrangements will exist to manage and dispose of the waste that will be produced by new nuclear power stations.

It is the only site-specific energy NPS. A rigorous Strategic Siting Assessment has been carried out by the Government focussed on sites that are deployable by the end of 2025 to meet our pressing climate change and energy security goals. The assessment looked at exclusionary and discretionary criteria, a Habitats Directive assessment and an Appraisal of Sustainability, and took on board advice from the Regulators and inputs from a Public Comments Window.

Ten of the eleven sites nominated by industry in March have been assessed as potentially suitable for new nuclear deployment by the end of 2025: Bradwell, Braystones, Hartlepool, Heysham, Hinkley Point, Kirksanton, Oldbury, Sellafield, Sizewell and Wylfa.

Dungeness was nominated but has not been listed as the Government does not consider that potential environmental impacts at this site can be mitigated. The Government also has concerns about coastal erosion and associated flood risk at that nominated site.

Following a rigorous independent study in line with the Habitats Directive, three alternative sites were identified as worthy of further consideration: Druridge Bay in Northumberland, Kingsnorth in Kent and Owston Ferry in South Yorkshire. It was concluded that all of them have serious impediments, none of them is credible for deployment by the end of 2025, nor are they necessary for our plans, and they have not been listed in the draft Nuclear NPS.

A consultation on the Secretary of State's proposed decision that two nuclear power station designs are Justified under the Justification of Practices Involving Ionising Radiation Regulations 2004 is also launched today. The benefits and health detriments of each of the two designs have been assessed and the Secretary of State has considered whether they are Justified according to EU legislation. The consultation seeks views on the proposed decision, and the evidence on which it is based.

CLEAN COAL

Alongside the NPSs, a Framework for the Development of Clean Coal is published setting out the most environmentally ambitious set of coal conditions of any country in the world. Following the consultation in June, today's document confirms:

No new coal without Carbon Capture and Storage (CCS):

With immediate effect, to gain development consent all new coal plant will have to show that they will demonstrate the full CCS chain (capture, transport and storage) from the outset on at least 300 MW net of their total output.

A programme of up to four commercial-scale CCS demonstrations, including both pre-combustion and post-combustion capture technologies, will be funded by a new CCS Incentive. Legislation to introduce this has been proposed for the forthcoming Parliamentary session.

A long term transition to clean coal:

We expect the demonstration plants will retrofit CCS to their full capacity by 2025, with the CCS Incentive able to provide financial support for their retrofit.

A rolling review process, which is planned to report by 2018, will consider the case for new regulatory and financial measures to further drive the move to clean coal. In the event that CCS is evidently not going to become a viable technology option, an appropriate regulatory approach for managing emissions from coal power stations will be needed.

Also confirmed today is that the Government has received two bids - from E.ON and Scottish Power - to proceed to the next stage of the current CCS demonstration competition. It is expected that contracts for the detailed design stage will be concluded early next year.

In addition, the European Commission has provisionally selected Powerfuels to receive €180m to develop a pre-combustion CCS power station at Hatfield. The Commission and Powerfuels are now negotiating the terms of the funding.

WHY IS PLANNING REFORM NEEDED?

The draft NPSs, which will have full public consultation and Parliamentary scrutiny, will guide the Infrastructure Planning Commission to make faster and fairer decisions. They represent a framework for the future of the UK's energy supplies, which are at present being hampered by the current planning system. For example:

* Renewables: The Scout Moor 65MW windfarm took nearly two years to secure planning permission. The Fullabrook 66MW wind farm took over 3 years to secure planning permission.

* Nuclear: Sizewell B took 6 years to secure planning consent, cost £30 million and only 30 of the 340 inquiry days were devoted to local issues. The new system will give greater opportunity for local people.

* Gas Storage: The proposed Presall gas storage facility to store 1020 million cubic metres of gas (20% of current storage capacity) was the subject of an application for planning permission in November 2003; an appeal was rejected by CLG in October 2007 - taking the process to four years.

* Electricity Networks: The North-Yorkshire grid upgrade, a major high-voltage transmission line upgrade, took 96 months to secure planning permission. This is an example of non-power station energy infrastructure that can cause major delays to projects intended to improve security of energy supply.

Notes for Editors:

1. The Energy National Policy Statements will be subject to an extensive 15 week consultation between the 9th November and the 22nd February with the opportunity for the public to influence and comment on these draft NPS at a national and local level. Parliamentary scrutiny will follow the conclusion of this consultation.

2. For more information on the draft energy NPSs and its associated consultation programme please visit: www.energynpsconsultation.decc.gov.uk

3. The document "A framework for the development of clean coal" is available here:
http://www.decc.gov.uk/en/content/cms/consultations/clean_coal/clean_coal.aspx
4. Today we're also publishing our guidance on carbon capture readiness. This guidance is intended to give practical advice on the type of information Section 36 applicants need to submit to the Secretary of State to demonstrate that a proposed new combustion plant can be built carbon capture ready (CCR). The CCR requirements only apply to new combustion plant which have an electrical generating capacity at or over 300 MW and which are of a type covered by the Large Combustion Plant Directive. The document is available here:

http://www.decc.gov.uk/en/content/cms/what_we_do/uk_supply/consents_planning/electricity/electricity.aspx

5. Department of Energy and Climate Change is central to the UK Government's leadership on climate change. We are pushing hard for an ambitious global deal in Copenhagen in December to avert the most dangerous impacts. Through our UK Low Carbon Transition Plan we are giving householders and businesses the incentives and advice they need to cut their emissions, we are enabling the energy sector's shift to the trinity of renewables, new nuclear and clean coal, and we are stepping up the fight against fuel poverty.

Reference: 2009/130

Department of Energy and Climate Change
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Contacts:

Department of Energy and Climate Change
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