Skip to content

Economic Prosperity

Building the Future of Britain: A New Model for National-Infrastructure Planning


Paper19th June 2023

Our Future of Britain initiative sets out a policy agenda for a new era of invention and innovation, based on radical-yet-practical ideas and genuine reforms that embrace the tech revolution. The solutions developed by our experts will transform public services and deliver a greener, healthier, more prosperous UK.


Chapter 1

Executive Summary

Britain needs to build. We require modern world-class transport and AI-era digital infrastructure that provide opportunities for individuals and businesses; a water and sewage system capable of adapting to changing weather patterns and new ways of living; and an energy grid that can make cheaper, cleaner power a reality for millions of firms and households.

As it stands, the country’s physical and digital infrastructure are largely from a different era. The infrastructure needed to drive growth and prosperity is not being built anywhere close to the pace at which it is required or at a cost that is affordable.

The UK has fewer 5G sites per person than the United States (US), Japan and European Union (EU), it has some of the lowest levels of water storage and its energy system is not ready to power the decade of electrification that lies ahead. Projects take longer and costs rise inexorably. High-speed rail projects in the UK cost between two and five times more than the G7 average.[_] Building an offshore wind farm takes up to 13 years even though the construction phase takes just three years.

Our current planning system for national infrastructure projects is the cause. Since 2012, when the system was last reformed, the average time it takes to secure consent has increased by 65 per cent, rising to more than four years from the previous two and a half. This follows a pre-application process that averages two years, but which can take far longer for more complex projects.

Planning has become the epitome of democracy’s efficacy problem. A system which was once intended to accelerate and provide certainty for infrastructure development has become a burdensome process that limits build and pushes up costs by as much as 30 per cent.[_] In its desire to enhance democratic legitimacy, it puts local consultation at the heart of the consent process. The result is a system in which a small number of organised voices can halt progress, holding the UK back by emphasising the interests of a vocal few over the benefits to the many.

The system needs reform. This paper sets out a bold new model for national-infrastructure planning that cuts the time it takes to obtain consent by 80 per cent and ensures that projects of national importance receive national consent. This should be done by:

  1. Modernising the definition of nationally significant infrastructure to include current priorities such as 5G infrastructure and onshore wind power.

  2. Updating national policy statements (NPS) annually to set out clear priorities for development, both in terms of sector and geographic area. These NPS would be agreed by parliament, transferring final consent for projects from local to national level.

  3. Making better use of data and technological solutions to optimise projects and mitigations, accelerating the planning and environmental-assessment phase.

  4. Standardising the consultation and approvals process to reduce unnecessary delays. Community involvement in the planning phase would be streamlined.

By introducing clear processes and guidelines, and using the power of data and technology to determine which projects and sites are viable, streamlined evidence-based decisions can be made. This new model for planning can serve as a foundation for growth, prosperity and progress for a better-connected Britain.


Chapter 2

Britain Needs a New Age of Infrastructure Delivery

The quality of our infrastructure is declining. According to the International Institute for Management Development’s (IMD) World Competitiveness Ranking, the UK’s infrastructure has fallen from its place at ten in 2018 to 18 in 2022. When it comes to “basic infrastructure”, which includes transport, energy and water, the UK ranks 31st.

To reverse this decline and deliver a new generation of modern infrastructure the UK needs:

  • A modern and efficient rail network that can unlock growth and productivity across the country.

  • Energy infrastructure fit for the coming decade of electrification. To meet our climate targets, over the next decade we need to double the capacity of the transmission grid, triple current levels of renewables generation, and build facilities for hydrogen and carbon capture. The UK has built less than 12 gigawatts (GW) of grid since 2012 and only about 45GW of generation since 2010, which means that the speed of delivery needs to double for renewables and increase almost fivefold for grid infrastructure.

  • New and enhanced water networks and water-storage capabilities, including reservoirs, water-transfer schemes, desalination plants and effluent reuse. The country is increasingly at risk of droughts, yet the UK has some of the lowest water-storage levels in Europe and currently one-fifth of UK water supply is lost through leaks. We need modern water infrastructure capable of adapting to changing weather patterns and new ways of living.

  • Digital connectivity to enable the technology of the future, including 5G masts. Currently the UK has 12,000 5G mobile sites, but the US, Japan and EU have two to three times the number of 5G sites per person​ and the UK does not rank in the top 15 countries for 5G speeds.[_] We should aim to have 50 5G base stations per 100,000 people by 2028.

Despite the need for major infrastructure, the planning system is currently a barrier rather than an enabler. Since 2012, the average time it takes to get consent for national-infrastructure projects has increased by 65 per cent, rising to 4.2 years from 2.6 years. This follows a pre-application process that averages two years, which in many cases can be far longer.[_] In 2016, the total number of delays in granting a development consent order (DCO) decision was 509 days. By 2021, this had increased to 4,000 days.[_]

The duration of the planning phase relates to onerous requirements for local consultation and environmental impact assessments (EIA); the documentation produced for planning applications has tripled in the last eight years. The prevalence of judicial review has also spiked in recent years to 58 per cent of all projects from an average of 10 per cent. Developers are therefore increasingly spending more time on thorough EIA to avoid more lengthy legal challenges down the line.[_] With a prolonged planning process, more work is needed to keep documents up to date. Delays also mean that more of the budget is consumed by inflation, impacting plans and further delaying delivery. The overall result is a significant increase in the costs associated with the planning process, creating a regime that is increasingly unaffordable.

This slow system introduces uncertainty and complexity into every project and impacts significantly on delivery and costs. The practical effects can be seen in recent examples; the HS2 high-speed rail project has been built in stages based on where and when the project has gone through the local consultation process. This phased approach to development drives up risk and as a result costs across the project; the result is a slow and expensive build and overall rail costs two to five times the G7 average.

Similar issues can be seen when it comes to energy infrastructure. Offshore wind is a pillar of the government’s energy-security strategy, yet currently it takes up to 13 years to complete a project[_] even though the construction phase only takes three years. A major reason is the drawn-out planning process for these projects. The National Infrastructure Commission (NIC) clearly outlined the problem and its causes in its recent review of the nationally significant infrastructure projects (NSIP) system for energy projects.[_] National policy statements (NPS), which set out government policy for the delivery of national infrastructure, have not been updated since they were first issued and are not supported by clear guidance. As a result, the Planning Inspectorate’s role has shifted from that of assessor to arbiter as it deciphers old planning guidance that does not correspond to wider government policy.

This means that the need for the infrastructure itself – which should be a question for central government – is often debated at the planning stage between the developer, the community and the Planning Inspectorate. Decision-making is then often pushed up to the relevant secretary of state without a clear recommendation. Moreover, developers must often spend months or years independently collecting environmental data already gathered for other projects or designing bespoke environmental mitigations despite the existence of similar, successful mitigations elsewhere. The impacts are huge delays for projects.

The secretary of state has not approved a single offshore wind farm since 2017 because of environmental concerns and a Planning Inspectorate unable to make decisions based on outdated NPS. But offshore wind is not the only victim. Solar and nuclear projects, as well as electricity-grid build-out are experiencing significant delays. Solar developers report that moving projects through the national planning process is not cost-effective for schemes between 50 and 200 megawatts. The planning process for building new transmission lines can take years and projects can be delayed by loud local voices even before they are submitted.[_] This is despite the fact that there will need to be a fourfold increase in annual transmission-project consents by 2027 from historical rates just to meet the government’s 50GW target.[_]

Given the urgent need to transform energy infrastructure specifically, other countries are actively reforming their planning processes. The EU recently updated its renewable energy directive, while the US is working on reforming the permitting process for energy projects; it has agreed to limit environmental-impact studies for clean-energy projects to two years but has not yet reformed the permitting process for transmission grids.[_]

The risk for the UK is that its regulatory environment will seem slower and more unpredictable than other countries, resulting in lower investment and higher infrastructure costs. However, by acting decisively to create a rapid and predictable planning process, the UK could develop a competitive edge and attract investment for key projects to deliver them at lower public cost. The UK cannot afford a drawn-out planning process if it wants to unleash the economic, social and environmental benefits of infrastructure and to compete more effectively.

The Evolution of Infrastructure Planning

The UK has a long history of building world-class infrastructure. In the 18th and 19th centuries, following the Industrial Revolution, Britain rapidly built an extensive network of road, canals and railways, and began developing large-scale electricity and telecommunications networks. All to connect the country, driving growth and prosperity.

Intense bombing during the second world war created fresh need for rapid housing and infrastructure development. However, during the first half of the 20th century, public backlash against unplanned development had gained momentum and, by the 1940s, developed into a strong political force. In response to these twin pressures, the Attlee government introduced the Town and Country Planning Act 1947, which nationalised the right to develop land and required all proposals to secure planning permission from the local planning authority. The aim was to empower local authorities to balance both development and preservation needs when planning infrastructure and housing. The law also introduced the preparation of local plans to guide decision-making and laid the foundations for today’s modern emphasis on public involvement.

By the end of the 20th century, reduced direct national control over infrastructure meant that major projects were being delayed or even blocked. The Planning Act 2008 was introduced by the Labour government to speed up the process for approving major new infrastructure projects such as airports, roads, harbours, energy facilities and waste facilities. It created provisions for nationally significant infrastructure projects to bypass local planning requirements through the introduction of national policy statements (NPS) which specified what constituted a nationally significant project and gave the responsibility for approving and granting development consent orders to the Infrastructure Planning Commission (IPC). The idea was to move democratic input to the consultation stage through parliamentary scrutiny of the NPS, thereby shifting consent from local to national level. It was expected that the legislation would reduce the average time it took to receive consent for major infrastructure projects from up to seven years to less than a year.

The act met significant opposition from the Conservatives and Liberal Democrats. As a result, the process was reformed again under the coalition government. The Localism Act 2011 aimed to facilitate the devolution of decision-making powers from central government to individuals and communities to democratise the planning process. As part of this, the IPC was abolished and decision-making powers transferred to the relevant secretary of state, advised by the new infrastructure planning unit within the Planning Inspectorate. While the intention was for decisions to be taken at least as quickly as under the previous system, in reality the reforms slowed down the process significantly.

Planning policy, once intended as a guardrail for the government to help structure and prioritise development, had developed into a means through which development could be blocked.


Chapter 3

A Model for a Modern Planning System, Facilitated by Technology

Planning has become illustrative of democracy’s efficacy problem. Democratising the planning process has, in effect, led to it being used by small groups of people to block what is in the interests of many more. A modern planning system for national infrastructure needs to shift to a process of national consent and assessment to ensure that what is built reflects national priorities. It must also use the power of modern technology to improve efficiency.

By their nature, projects that are defined as nationally significant must be reviewed and treated as a collective, rather than having their components assessed on a case-by-case basis. This is because projects such as a national 5G network or electricity grid must be seen in the context of their aggregate outcome rather than each component’s individual effects. Similarly, infrastructure projects spanning multiple communities, such as high-speed rail links, are ultimately a national good that cannot be considered on a community-by-community basis.

A new planning act should be introduced to reform the system. This proposal is built on four key changes, creating a system more akin to the original NSIP regime of 2008 and delivering more certainty and speed for developers. This new system should:

  1. Modernise the definition of nationally significant infrastructure for planning purposesto better reflect current national priorities, including digital-communications infrastructure.

  2. Require NPS to be reviewed and updated annually, to clarify priorities and highlight specific projects and corridors for development. These NPS would be agreed by parliament, transferring final consent for projects from local to national level.

  3. Use centrally held data and technological solutions such as digital twins to better target projects and optimise mitigations, thereby accelerating the planning and environmental-assessment phase.

  4. Streamline and standardise the consultation and approvals process, including using AI, to increase certainty and reduce unnecessary delays.

These four changes would reduce the time it takes to get planning approval by up to 80 per cent and deliver the certainty that infrastructure providers need to invest and keep costs down. Figure 1 illustrates how the proposed system would compare to the current process.

Figure 1

How a new planning process would accelerate project approvals

Figure 1 – How a new planning process

Source: TBI. (Note: NIMBY, short for “not in my back yard”, refers to people who oppose development in their local area.)

1. Modernise the Definition of Nationally Significant Infrastructure

The NSIPs defined in the Planning Act 2008 were: 1) energy (including fossil fuels, renewable energy, oil and gas supply and storage, electricity networks and nuclear power), 2) transport (including ports, national networks and airports) and 3) water, waste and wastewater (including hazardous waste, wastewater and now also water resources).

These NSIPs need to be updated to better reflect modern national priority areas. This includes re-introducing onshore wind to the energy NPS. Reaching net zero by 2050 and zero-carbon power by 2035, or even 2030, relies on using all available methods of generation; all major generation projects including onshore wind should be treated as nationally significant as part of this national mission.

A new NPS for digital connectivity and 5G infrastructure should also be added. The latter is essential for the AI era. It has the potential to enable new innovations such as virtual reality, smart-energy networks, vehicle-to-everything technology, smart manufacturing and drone delivery. The UK government’s current ambition is for the majority of the population to have access to a 5G signal by 2027, but delivery will depend on being able to rapidly build 5G infrastructure across the country. With 5G included in the NSIP regime, the government can designate corridors for 5G development to make it quick and easy to build masts.

2. Require the NPS to be Reviewed and Updated Annually

The NPS, the mechanism through which national-infrastructure projects receive parliamentary consent, are too vague, leaving consent orders open to review and challenge. The NPS have also not been updated regularly since 2011. The first NPS for water-resources infrastructure was only approved this year, 15 years after the NSIP regime was created and five years after consultation began in 2018. Meanwhile, the energy NPS was last updated in 2012, meaning it does not currently reflect important developments in energy policy, including the net-zero commitment itself. Ambiguous and outdated NPS make it difficult for developers and the Planning Inspectorate to make appropriate decisions and enhance the chances of judicial reviews.

The new planning act should include a requirement for the government to review the NPS on a yearly basis and update them as appropriate to reflect new priorities for infrastructure development. Updates could include identifying specific priority projects, such as high-speed rail, or could involve designating zones or corridors for energy or 5G development.

Responsibility for developing the NPS should be transferred from government officials to the NIC, which was set up in 2015 to provide impartial, expert advice on major, long-term infrastructure priorities. The NIC can best assess infrastructure needs and appropriate locations, including risks and mitigations, based on government policy.

As part of the NPS development process, the NIC would be responsible for engaging with significantly impacted consultees. However, to limit NPS development time, there would be no statutory consultees, to reflect a more flexible process, nor would there be a formal public consultation. The NPS would then be endorsed by the secretary of state before they were debated and agreed by parliament. Ultimately, engagement on how and whether a project went ahead would sit at a national rather than project-by-project level, with final consent given by the government and parliament, rather than local areas.

3. Use Data and Technology to Accelerate Impact Assessments

Impact assessments are done on a project-by-project basis by the developer, in consultation with the local community. This is inefficient; each project develops bespoke mitigation plans even though similar work may already exist.

Impact assessment for projects, undertaken as part of the NPS development, could be accelerated and optimised by better use of data and modern technology. Collating information about land and communities where development could take place would allow assessments of possible locations and appropriate environmental or other mitigations to be determined upfront in a simplified but tailored manner. This would avoid multiple projects being halted at the approval stage due to similar environmental concerns, as was the case with five offshore wind farms examined between 2018 and 2021. These were delayed by up to two and a half years as they developed mitigations for similar environmental impacts.[_] With better data and locational understanding at an earlier stage, standard mitigations could have been developed as appropriate, reducing project delays.

Upfront assessment of land for development could also be used to create development zones in particular areas. The Spanish approach is an example of how this could be done. Spain has graded land into zones based on how environmentally vulnerable they are and provided a simpler planning-approval process for renewable-energy generation in zones that are deemed lower risk. A similar approach, or something even more targeted, could be adopted in the UK.

Digital-twin technology should also be used to examine the impacts and possibilities of infrastructure development in advance and to assess where and how the build should happen based on real-world data. For example, the National Grid has recommended establishing a “Strategic Spatial Energy Plan”[_] setting out what needs to be built, where and when. To optimise the development of grid and renewables capacity, a digital-twin approach could be used to map out future energy demand, layer on wider societal and environmental considerations and stress-test the model under a range of scenarios.

As part of the new planning act, it would also be appropriate for climate risk to be given greater weighting than localised environmental concerns when a project was assessed. This approach has been taken by the EU in their permitting reform.

4. Streamline and Standardise the Consultation and Approvals Process

The current planning system includes a lengthy stakeholder-engagement process in which developers collect environmental data and develop mitigations on a project-by-project basis. This is inefficient in several ways. First, due to the high threshold the Planning Inspectorate sets for adequate community engagement, developers engage in long consultations before submitting their NSIP application. Second, due to the high risk of judicial review after EIA, developers are incentivised to gather more studies than necessary to protect the project. Third, the Planning Inspectorate acts as an assessor and broker between developer and community, rather than evaluating the projects’ merits. Finally, given how infrequently some NPS are updated, how ambiguous they are and their lack of coherence with wider government policy, the Planning Inspectorate has to second-guess government policy and, in many instances, ends up being unable to make a decision, passing the responsibility to the secretary of state.

Under our reforms, the decision on whether an area should be developed and the EIA both take place upfront as part of the NPS process. This means that the Planning Inspectorate only has to determine whether the project meets the established parameters of the NPS. With this clearer framework, the Planning Inspectorate’s decision-making could increasingly be done by AI, potentially saving significant time. In Vancouver, planning proposals are accepted within minutes using AI technology.[_]

Community involvement at the planning stage would also be streamlined. Under our model, community consultations are limited to agreeing which of the pre-defined decisions and standardised benefits the community should accept, rather than including whether the project should go ahead. This involves introducing a standard framework for delivering community benefits in areas hosting major infrastructure development. In line with the NIC’s recommendation, the benefits available should be tailored to the type of infrastructure. For instance, some projects such as reservoirs deliver local benefits and so would not require additional community-benefit schemes. However, projects such as electricity transmission lines, which pass through local communities but deliver benefits at the national level, may require appropriate compensation. There are international examples of how benefits can be provided; in the context of electricity grids, Italy, Germany, France and Ireland all offer different fixed-rate benefit packages either based on a percentage of project costs or per km/asset type.

Overall, these reforms should drastically reduce the time it takes for a developer to obtain a DCO. A process that now takes over six years could, under our revised system, be done within three months.


Chapter 4

Conclusion

The UK needs modern, world-class transport and AI-era digital infrastructure that connects individuals and businesses to opportunity. By implementing this proposal for planning reform, the government can deliver this infrastructure at the pace and cost required. For developers, timelines for securing planning consent can be reduced by 80 per cent and much-needed predictability can be introduced into the process to help projects run on time and to cost.

Lead image: Getty

Footnotes

  1. 1.

    https://transitcosts.com/high-speed-rail-preliminary-data-analysis/

  2. 2.

    Ferrovial boss on why high speed rail costs more in UK | New Civil Engineer

  3. 3.

    https://www.opensignal.com/2022/06/22/benchmarking-the-global-5g-experience-june-2022

  4. 4.

    https://nic.org.uk/app/uploads/NIC-Planning-Study-Final-Report.pdf

  5. 5.

    https://storybent.foleon.com/ankura-infrastructure-perspectives/2023/decisions-decisions-delayed-decisions

  6. 6.

    https://nic.org.uk/app/uploads/NIC-Planning-Study-Final-Report.pdf

  7. 7.

    Rate of wind turbine installation needs to be tripled for UK to hit 2030 target | New Civil Engineer

  8. 8.

    https://nic.org.uk/app/uploads/NIC-Planning-Study-Final-Report.pdf

  9. 9.

    https://www.bbc.co.uk/news/uk-england-suffolk-64913250

  10. 10.

    https://nic.org.uk/app/uploads/NIC-Planning-Study-Final-Report.pdf

  11. 11.

    https://www.reuters.com/business/energy/us-debt-deals-energy-permitting-reforms-leave-thorniest-issues-later-2023-05-30/

  12. 12.

    https://nic.org.uk/app/uploads/NIC-Planning-Study-Final-Report.pdf

  13. 13.

    https://www.nationalgrid.com/document/149501/download

  14. 14.

    https://vancouversun.com/opinion/columnists/tentative-dan-fumano-a-new-way-to-tackle-the-housing-crisis-robots

Newsletter

Practical Solutions
Radical Ideas
Practical Solutions
Radical Ideas
Practical Solutions
Radical Ideas
Practical Solutions
Radical Ideas
Radical Ideas
Practical Solutions
Radical Ideas
Practical Solutions
Radical Ideas
Practical Solutions
Radical Ideas
Practical Solutions