During the past 20 years, clean energy has gone from being a small sub-sector of power generation to the clear future of the energy industry, with many renewable energy markets now coming to maturity and achieving cost efficiency. The future of clean energy certainly looks promising.
However, with demand on the national grid continuing to grow and trends such as electric vehicle transportation rapidly emerging, the UK cannot afford to slow down with clean energy generation and, alongside this, storage capacity. To ensure this, current stakeholders in the energy market (most notably policymakers) need to keep working to remove barriers to the development of clean energy and storage projects, and provide a more straightforward regulatory framework that will enable the industry to reach its full potential.
One such barrier is the requirement in the UK for projects generating 50MW or more to obtain the more costly development consent order (DCO) rather than a standard planning permission under the Town and Country Planning Act 1990. This makes it difficult for large-scale energy storage projects to secure consent and get off the ground.
Although the government has stated that energy storage is a key element of its Clean Growth and Industrial Strategies, the additional costs and uncertainty presented by the DCO regime for energy storage have inevitably hindered progress in an important sector of the energy market.
In a bid to address such restrictions, the Department of Business, Energy and Industrial Strategy announced in October 2019 that it was seeking views on amendments to the treatment of energy storage within the planning system. This comes after the government launched an initial consultation in January 2019, following an update to progress on the Smart Systems and Flexibility Plan, which was published jointly by the government and Ofgem in 2017.
In the last consultation, it had been proposed that the 50MW Nationally Significant Infrastructure Project (NSIP) capacity threshold should be retained for standalone storage facilities.
However, following disagreement from respondents to the consultation, the government has reconsidered its stance. This latest follow-up consultation proposes that electricity storage (except for pumped hydro) be carved out of the NSIP regime in England and Wales so that the standard planning application process is followed rather than the DCO process.
In theory, this should make gaining planning permission straightforward and potentially less expensive. Removing obstacles in this way is a positive and pragmatic move by the government.
With energy storage projects now set to find a primary consenting route in England under the Town and Country Planning Act 1990 (under the same law via the Local Planning Authority in Wales), we might expect to see the frequency at which energy storage projects are built increase. Given that obtaining a green light from planning authorities should now prove more straightforward, this change should also help to attract a growing number of investors and development partners by providing greater certainty that large battery storage schemes can be brought to completion.
Since non-subsidy clean energy schemes require scale to achieve cost savings, larger projects make strong financial sense and the government’s updated policy position should be an effective way of stimulating the development of large projects.
As recent events such as last summer’s National Grid blackouts have highlighted, a more reliable energy system that includes widespread storage facilities will be vital in the transition towards a system powered by clean energy. Not only does storage have the obvious benefit of providing readily available power, it can also make clean energy schemes highly reliable by solving intermittence issues and help make energy provision more efficient from a financial perspective by controlling when electricity is stored or released.
The consultation is a positive and pragmatic sign that policymakers are beginning to understand the necessity of energy storage in order to accelerate the shift towards a cleaner, smarter and more flexible energy system. The proposed changes are a welcome move from the government, but a wider reform of the planning system to encourage clean energy and storage would also further accelerate the adoption of such technologies and help the UK meet its 2050 net zero carbon emissions objective.