Electricity storage: loading up for consenting clarity

England

The planning system’s treatment of electricity storage and co-location is complex, in part because the current planning framework was devised without storage technologies in mind. Whilst storage technologies may be standalone or co-located with other forms of generation, the planning system does not adequately distinguish between the two. This means that there are a number of issues that must be considered to ensure that an electricity storage facility is lawfully consented.

The consistent view of BEIS is that electricity storage is a form of generation and this remains its stance. BEIS has recently confirmed this position  in the Drax Repower decision, where it held that electricity storage was a form of generation that formed a generating station and was a nationally significant infrastructure project (an NSIP) for the purposes of the Planning Act 2008 (the 2008 Act). In that case, the Examining Authority originally concluded, before being firmly overruled by the Secretary of State, that  electricity storage was not a form of generating station as a matter of law but was a matter of policy. This clearly demonstrated the ongoing lack of understanding faced by those seeking to promote electricity storage projects.

To provide consenting clarity, BEIS has previously consulted on a proposal (which we reported on here) that:

  1. standalone electricity storage projects with a capacity of more than 50MW would continue to fall within the NSIP regime and would have to be consented pursuant to a DCO; and
  2. co-located projects where the capacity of the generating station, excluding any electricity storage, was more than 50MW or where the capacity of any electricity storage was more than 50MW would fall within the NSIP regime and would be consented pursuant to a DCO.

However, in response to this consultation, BEIS have revised their position. Now, BEIS’ proposal is to carve out electricity storage, except pumped hydro, from the NSIP regime and section 36 consent regime in both England and Wales. To achieve this, two draft orders have been published: The Infrastructure Planning (Electricity Storage Facilities) Order and The Electricity Storage Facilities (Exemption) (England and Wales) Order.

This means that for:

  1. standalone electricity storage (except pumped hydro) in England and Wales, the starting position will be that projects are consented under the Town and Country Planning Act (TCPA) regime;
  2. co-located projects involving storage, the storage element of a new or extended composite generating station would never trigger the NSIP capacity threshold regime by itself. However, if the co-located generation source exceeded the NSIP threshold then the storage element could be consented as associated development.

This will provide some consistency with the Welsh Development of National Significance Regime, where electricity storage is already carved out from that regime.

This policy change is likely to have other regulatory impacts for storage projects, for example on Ofgem’s July consultation on the storage elements of the electricity generation licence, which we reported on here.

Developers promoting standalone electricity storage projects could still seek a direction under section 35 of the 2008 Act. This acts as a direction that development is treated as being of national significance for which a DCO is required under the NSIP regime. There are numerous examples of energy projects, notably electricity interconnector projects, seeking such directions. There remain certain benefits in seeking such a direction, including the availability of powers of compulsory acquisition and securing consent where there is a non-receptive local planning authority.

The carve out will also apply offshore, in relation to both the NSIP regime and the section 36 consent regime. This would mean that, should offshore technology evolve, and storage become a viable offshore technology, then a:

  1. standalone energy storage project would require a marine licence under the Marine and Coastal Access Act 2009; but
  2. co-located project could still be consented as associated development under a DCO on a similar basis to onshore development.

A number of respondents to the original consultation requested further clarity on the applicability of permitted development rights to electricity storage, both generally and specifically for electricity undertakers. This has led to an important clarification, that where a developer seeks to rely on Part 7 of Schedule 2 to The Town and Country Planning (General Permitted Development) (England) Order 2015 to construct electrical storage within an existing premises then the majority of the electricity stored does not need to be used on-site. However, that storage must still be ancillary to the primary use of the premises.

Finally, BEIS confirmed that the consultation is not intended to affect the application of the Environmental Impact Assessment (EIA) Regulations. It will need to be determined on a case by case basis whether electricity storage falls within schedule 2 of the EIA Regulations or not.

We consider that the consultation will be welcomed by the storage industry as it provides necessary consenting clarity on electricity storage. This may also expedite further large scale electricity storage projects, primarily due to the time and cost benefits in consenting projects through the TCPA regime and not the NSIP regime.

What next?

The deadline for consultation response is 10 December 2019.