Industry asks new gov for planning reform, investment incentives

The Energy Networks Association (ENA) has called on the next government to create a stable policy and regulatory environment for long-term investment and supply chain capacity. Its members are set to invest £33 billion into the distribution and transmission system.

ENA’s “Powering Forward” 2024 election manifesto outlines four key priorities for the next government. It says construction of new transmission infrastructure takes 10 years, the first seven of which are “bogged down in planning”.

The Association for Renewable Energy and Clean Technology (REA) has also addressed the next government, publishing a vision for its first 100 days. It is organised across the REA strategic pillars of Circular Bioresources; Heat and Cooling; Power and Flexibility; Transport; and cross Pillar objectives.

According to Dro Nina Skorupska CBE, CEO of the REA: “The REA’s First 100 Days action plan is a comprehensive vision that would galvanise the entire sector across multiple technologies.”

Across all pillars, REA’s objective is to put the energy transition front and centre of the government’s legislative programme, promote joined-up thinking across departments, and ensure sustainability is at the heart of policy development.

The next government should establish an Office for Net Zero Deployment within the first 100 days, as recommended in Chris Skidmore’s Net Zero Review.

Planning and connections

Echoing ENA’s criticism of current planning systems, REA asks the next government to reform planning guidance by 2025 to prioritise renewable deployment and commit to halving the time taken for planning decisions on renewable assets. It should also reinvigorate financial incentives to encourage green technology adoption.

While almost 10GW of clean generation and interconnection have been connected in England and Wales over the last five years, ENA says the connections pipeline is at more than 12x more than what is needed to hit net zero targets.

As such, its manifesto also calls for a reform to the connections process. Alongside this, a stable policy and regulatory environment will unlock investment and supply chain capacity “for the long term”.

Incentivise investment

In terms of financing, REA asks that the next government finalise options within Review of Electricity Market Arrangements (REMA) to create a secure, affordable and decarbonised energy market.

Then, establish a rolling timetable & budget for Contract for Difference (CfD) allocation rounds to secure new investment in large scale renewables and provide bespoke capital allowances to incentivise renewable investment.

Regulation should also be adjusted in those first months to ensure decarbonisation of the heat network. REA calls for a specific Heat Contracts for Difference mechanism and expansion of the Boiler Upgrade Scheme (BUS) to accelerate residential decarbonisation. The introduction of a Fuel Switching Tariff would promote commercial decarbonisation, it said.

ENA members are set to invest £22 billion into electricity distribution (2023-2028) and nearly £11 billion into transmission (2021-2026). The manifesto states: “For sustained investment and to give a clear signal to the supply chain, we need a clear, consistent and enduring policy and regulation environment.”

Finally, the next government should support the evolution of regulation. ENA backs the current model for network regulation – “it’s been great for customers”. However, the government should ensure the regulatory regime can continue to deliver by ensuring networks are financeable and “maintain the gold standard of investability”.

ENA chief executive Lawrence Slade said: “With a month to go until the polls open, our manifesto sets out what we’ll need from the next government to accelerate progress.

“There’s widespread recognition and appetite to upgrade the planning system, further reform grid connections and enable decarbonisation. Getting this right means unlocking investment, jobs and supply chain opportunities for the years ahead.”