Jeremy Miles MS
Cabinet Secretary for Economy, Energy and Welsh Language
3 July 2024
Dear Jeremy,
Thank you for your letter of 22 May and the subsequent meeting on 18 June which addressed our recommendations for accelerating the deployment of renewable energy in Wales.
In the meeting on 18 June we said that we were preparing more detailed feedback on the responses by the Welsh Government. I have enclosed our comments in an annex to this letter below.
Our overriding concern is the apparent lack of urgency in amending policies or regulations which lie wholly within the ambit of the Welsh Government. To take just one example, Welsh residents currently have to apply for planning permission for subsidised air source heat pumps, which results in Welsh citizens inadvertently underwriting low-carbon improvements for our English neighbours. The suggested timescale for amending this within Welsh regulations is unclear but not urgent.
We very much welcome your appetite for challenge, and for your attention to our concerns, and we look forward to continuing to engage with you in the future.
Yours sincerely,
| Dr David Clubb, Chair | Dr Jenifer Baxter, Deputy Chair |
Recommendation 1 – Leadership and strategic approach
Our recommendation specified that both leadership and a strategic approach were needed to support the acceleration of renewable energy in Wales.
Whilst we welcome Welsh Government’s commitment to develop a National Energy Plan by the end of 2024 that will set out the changes needed to meet a Net Zero 2050 we note that a number of detailed aspects of our recommendation were not addressed.
These aspects include:
- A single unambiguous statement on the role for renewable energy to 2050, including grid and other infrastructure requirements.
- Supportive policy statements on technologies, targets and spatial dimensions
- A strategic approach that aligns with carbon budgets and interim dates of 2030 and 2040
- A public engagement campaign to build support for a Wales-wide approach
- A cross-departmental approach chaired by the Minister to ensure coordination
We look forward to these aspects forming part of the National Energy Plan development process.
Recommendation 2 – A grid fit for a future Wales (A Welsh approach)
Our recommendation emphasised the long-term needs of Wales, along with Wales’ specific policy needs.
We welcome the detail on the range of ways in which the Welsh Government is interacting with public and private sector organisations to ensure that Wales gets the grid it needs to achieve multiple objectives. We also welcome the recent initiative of Welsh Government in supporting a Future Grid for Wales group where NICW will be represented by the Chair.
The Welsh Government response highlights the long-term nature of its engagement with delivery partners. Our concern is that these engagements and relationships do not appear to have delivered a pipeline of significant grid developments in Wales. The recent ‘Beyond 2030’ publication by ESO detailed 46 pages of activity in Scotland, with just 8 pages for Wales.
Furthermore, all of the new upgrades or developments are rated at the lowest level of maturity (scoping), seeming to indicate that any physical manifestation of the developments will be many years (or possibly decades) into the future.
This lack of detail is concerning given the urgent need to facilitate the Port Talbot steelworks electrification and the Celtic Sea offshore wind developments.
We look forward to Welsh Government clarifying how its ambition and strategic approach (Recommendation 1) will be enabled by strong action by UK public and private sector partners on grid, and what influence Welsh Government will bring to bear to ensure that Wales’ potential for renewable energy can be maximised in a timescale appropriate to a climate emergency.
Recommendation 3 – A grid fit for a future Wales (Ofgem)
This recommendation was targeted at Ofgem. We wrote to Ofgem in October 2023 to ask for their feedback but did not receive a reply. We have recently written to the Chair and Chief Executive of Ofgem to request their response.
Recommendation 4 – The built environment (Part L)
Our recommendation highlighted the need for an immediate review of Part L of the building regulations to mandate the use of renewable technologies in all new developments, as well as significant renovations or extensions.
We highlighted solar photovoltaic and solar thermal as two technologies that should be considered mandatory. The Welsh Government suggests that this mandate would stand in the way of innovation. It would be helpful for us to understand the evaluation that the Welsh Government has undertaken to demonstrate that a mandated solar standard would make the Welsh built environment sector less innovative.
We note that the European Commission recently enshrined exactly this mandate into European legislation, requiring solar installations on all new rooftops in the EU by 2029 at the latest, and on existing public buildings by 2030. We also recommended that the Welsh Government keep abreast of EU policy on domestic energy precisely for the reason of being able to adopt existing good practice as deployed by our nearest trading partners.
Given that grid constraints are so important for Wales’ net zero future, we are disappointed that the Welsh Government did not appear to consider our suggestion of mandatory battery storage in new developments and look forward to this consideration being addressed.
We would like to emphasise that Wales used to be considered a leader in policy for sustainability. In 2008 Wales had the aspiration for all new homes to be Level 6 under the Code for Sustainable Homes framework by 2011. Indeed, the pursuit of zero carbon housing was one of the stated objectives of seeking devolution of Part L.
We are now thirteen years beyond that date with current policy seemingly still not being as ambitious as the aspiration of the third Senedd.
Recommendation 5 – The built environment (Permitted development)
Our recommendation called for an immediate review to eliminate impediments to renewable energy deployment.
The Welsh Government’s response, whilst welcome, does not seem timely when considered in the context of the climate emergency. We deliberately used the word ‘urgent’ in our report; the Welsh Government commits only to working up options this year, with this precipitating a review.
Our justification for this urgency included the potential for a huge increase in planning applications for heat pumps to swamp the ability of planning authorities to be able to respond. Early and rapid progress on this recommendation would forestall any such issue, and demonstrate the practical use of the ‘prevention’ Way of Working.
At the moment the equivalent installation in England is a permitted development. The unintended consequence of Wales’ approach is that Welsh citizens are effectively subsidising installations for English residents by a huge disparity in take-up of a subsidised technology.
Recommendation 6 – Planning (Positive silence)
We believe that this recommendation would have significant value in the circumstances of a planning system that was well-resourced and provided a good service within stated timeframes.
Given the situation of insufficient resource throughout the planning system and particularly for energy projects, we can see a positive silence in planning resulting in potentially adverse impacts for developers. This serves to highlight the importance and urgency of our Recommendation 7.
Recommendation 7 – Planning (Shared resource)
Our recommendation was for the public sector in Wales to create a pooled resource of energy experts within the planning sector, to be able to better respond to planning applications for energy projects. Given that there is already a precedent for this kind of shared resource in the minerals sector, we do not think that Welsh Government needs to take an exploratory approach, and should rather implement what has been demonstrated to work already.
Recommendation 8 – Community benefits and ownership (Renewable energy Bill)
Our suggestion of a Renewable Energy Bill was to ensure that developments offered up a minimum amount of ownership to local communities. This recommendation was based upon the overwhelming feedback from participants in workshops across mid Wales who would be more inclined to support energy projects where there was certainty about the possibility of ‘buying in’ to the projects – if not individually or at a household level, then at least on a community scale.
We note that Welsh Government is confident of meeting its ambitious targets for community energy and local ownership within existing powers. However the setting of targets does not guarantee that they will be met; and there is no detail about how developers will be held to account if they do not meet these targets. We would like to see a public record of the ways in which developers have engaged with communities to raise interest in the opportunity to invest in the projects; and a mechanism for Welsh Government to pause the project development if the developer has not paid due regard to this component of the guidance.
There is very little publicly available information about Ynni Cymru and we are not able to judge what value Ynni Cymru is providing to the community energy sector.
Recommendation 9 – Community benefits and ownership (mandatory community ownership, and accelerated re-powering)
We recommended that renewable energy developments be required to offer up community ownership, and that sites that were to be re-powered should face a greatly simplified approach through planning, in exchange for additional community ownership.
The response from the Welsh Government focused on local ownership; a related but different topic. Local ownership includes projects that are wholly or partly owned by entities based or registered in Wales.
We welcome the additional requirement for a Collaborative Benefits Report in energy planning applications. However a Collaborative Benefits Report does not in and of itself guarantee better community outcomes from energy projects. This might be improved by a central public database of all projects, and the total calculated community ownership value arising from the project as a ‘per MW installed’ and ‘per GWh generated’ figure.
We are disappointed that neither the suggestion of ‘fast-tracking’ re-powering projects, nor our suggestion that community ownership be a material consideration, were considered by the Welsh Government.
Whilst we commend meeting 97% of the 1GW target of locally owned energy in Wales, we note from the ‘State of the Sector’ report by Community Energy Wales that only 29MW of this was community owned. This does not seem to be a good return for the communities of Wales for the declared levels of activity in the sector.
Recommendation 10 – Community benefits and ownership (Freeports)
We accept that Freeports may not be the mechanism by which to test a deregulated environment for community energy projects. However, we would like to see if other, similar, regimes, using existing levers available to the Welsh Government, could be utilised to the same effect.
For example, Local Development Orders could be used to simplify the planning regimes for renewable energy developments in designated areas. We would like to see the Welsh Government explore the potential for promoting such areas to local planning authorities; particularly in those areas where Local Energy Plans have already established the appetite for development in those areas.
Recommendation 11 – The Crown Estate Cymru
We welcome Welsh Government’s response and are happy to work in a coordinated way to help make the case to the UK Government.