UK government targets NSIP process reformation to cater for growing demand

The UK government is aiming to reform the Nationally Significant Infrastructure Project (NSIP) process in a bid to cater for the growing demand in developing energy projects within the UK.

NSIPs had been introduced in 2008 via the Planning Act 2008 in a bid to streamline key developments for the UK to achieve targets in the fields of energy, transport, water, waste and wastewater.

As the Russian invasion of Ukraine in February 2022 plunged much of Europe into an energy crisis, the UK stressed the need to both decarbonise and improve energy security. For this, NSIP projects could become an important cog in achieving these aims.

The current process involves six key stages. These include pre-application, acceptance, pre-examination, examination, recommendation and decision as well as a post-decision. The process is conducted by the Planning Inspectorate, a government agency which became responsible for NSIPs under the Localism Act in 2011.

The process has been positive since its inception and has reduced the time to achieve development consent to an average of around four years instead of the eight years it took to consent Heathrow Terminal 5 via a conventional planning inquiry.

But the government stated that the current system does not move with the focus and speed that is needed – something that is increasingly of concern in regards the UK’s energy transition and its bid to achieve net zero.

The government stated several key reasons as to why there is a need to reform the NSIP process, one of which includes the increase in the average length of time it takes for a case to reach decision. Development Consent Orders (DCO) increased by 65% between 2012 and 2021 from 2.6 to 4.2 years.

Along with this, more projects are requiring multiple extensions of time at the decision date. This is a key issue in the process for offshore wind projects with the government citing the technology as having some of the largest quantities of deadline extensions in the statutory stages.

Oher key issues include increases in the volume of documentation created during the NSIP process extending the time for decision making and an increase in the number of projects that are subjected to successful legal challenge.

To solve the issues around the NSIP process, the UK Government has committed to reforming five key areas. This includes setting a clear strategic direction, bringing forward operational reforms to support faster consenting, realising better outcomes for the environment, recognising the role of local authorities and strengthening community engagement and improving system-wide capacity and capability.

The government is hoping to pilot some of the key aspects of the reforms in September 2023 with hopes to review the proposed reforms from 2025.

10 solar projects are currently being explored as part of the NSIP scheme in the UK. These are outlined below including the development stage at the time of writing:

Proposed reforms to the NSIP process

Under reform area one: Setting a clear strategic direction for infrastructure planning, Secretaries of State will review existing National Policy Statements (NPS) to provide a clear and up-to-date need case for infrastructure. This alongside policy coverage for NSIPs, will help inform decisions on whether to review NPSs at the discretion of the relevant Secretary of State at a later date.

The Chancellor of the Exchequer and the Minister for Local Government and Building Safety have called on the National Infrastructure Commission to carry out a study to look at the role of NPSs and make recommendations on how these important documents can support the reforms.

This will include what action the government can take to ensure NPSs are reviewed more regularly and how the process could be improved.

Reform area two: Operational reform to support a faster consenting process, aims to ensure that project issues are identified collaboratively and addressed early on when changes are easier to make for projects.

The government hopes this will incentivise and create conditions for early, meaningful engagement between infrastructure developers and those with an interest in the projects. To achieve this, the government will streamline the application process and strengthen the support available to applicants by bringing forward regulations, guidance and proactive changes where necessary.

This will include an enhancement of the pre-application service for the NSIP process. This will additionally include a fast-tracking consenting timeframe which will be consulted on in Spring 2023.

Reform area three: Realising better outcomes for the natural environment, will simplify the formal environmental assessment that encompasses both the natural and historic environment. This can often be long and technical and thus simplifying this could accelerate the acceptance of proposed projects.

The changes will create the necessary framework to deliver infrastructure in a way that best supports environmental ambitions and marine planning reforms. This will see a new system of Environmental Outcome Reports and a new assessment to demonstrate delivery towards the government’s environmental outcomes. There will additionally be a biodiversity net gain requirement for all NSIP projects from November 2025 and a marine net gain requirement.

The fourth reform: System capability – building a more diverse and resilient resourcing model, will look to strengthen engagement with local communities across the NSIP process. In the current system, local authorities are key in representing community interests and helping negotiate community benefits with infrastructure developers.

However, their ability to do so is dependent on strategic negotiation and whether infrastructure developers are willing to engage at an early and formative stage of the process.

In the reformation process, the focus will be on incentivising early, constructive engagement on NSIPs to address impacts early and to reduce the burden on infrastructure developers and communities at the later stages of the consenting process, notably the examination.

There will also be an increase in the funding available to local authorities to support NSIP work by continuing to work via the recently established Local Authority Innovation and Capacity Fund (I&C). This will look to provide tangible improvements to securing benefits for local areas from community engagement, outcomes and infrastructure. Funding will also be provided to allow local authorities to engage earlier and more effectively with the NSIP process.

The fifth area to be reformed will look into system capability and building a more diverse and resilient resourcing model. After a call for evidence, users highlighted a lack of capacity and capability in the system as one of the major barriers to faster and better consenting.

Local authorities also stated that time is currently wasted negotiating developer funding for planning services rather than being able to get on with working together constructively.

To address these issues, the government will develop a workforce strategy targeted at addressing NSIP skills and capability gaps in government agencies. These will take steps to improve the NSIP system’s ability to predict demand and build capacity to meet it.

Workforce planning, improved online guidance, ongoing staff training and a new risk and opportunity approach to cases and further digitisation are among a range of measures being explored.

Legislative changes will establish new mechanisms to introduce proportionate cost recovery in a consistent way for the Planning Inspectorate in pre-application engagement, the government said. This will also be for key statutory consultees engaging meaningfully in the consenting process.

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