The National Policy Statement for Gas Supply Infrastructure and Gas and Oil Pipelines (EN-4) (the Gas and Oil NPS) clarifies issues raised in response to the original draft of November 2009 and the revised draft of October 2010. More information has been provided in relation to the delineation of responsibilities, and the interaction between the Infrastructure Planning Commission (IPC) and other regulatory agencies. It also provides further guidance on what information is expected to be included in an application, including an additional assessment of the impact of gas emissions due to the flaring or venting of gas. The Gas and Oil NPS should be read alongside the Overarching Energy NPS (EN-1).
As with the other NPSs, references to the IPC will be taken to be references to the Major Infrastructure Planning Unit (MIPU) or the Secretary of State after the Localism Bill has been enacted and comes into force.
As in the original draft, the position adopted in the Gas and Oil NPS, taken together with the Overarching Energy NPS, is to support projects which help to further national objectives to increase the UK's security of supply. The Gas and Oil NPS notes that these national objectives cannot be achieved without regulation that will enable and encourage investment in new infrastructure.
The Overarching Energy NPS states that it is "critical" that the UK continues to have secure and reliable supplies of electricity as the transition is made to a low carbon economy. In the medium term the Government feels that the challenge will necessitate maximising the UK's declining domestic oil and gas supplies and replacing power plants which are due to close. This will require additional infrastructure to be built, particularly for electricity generation and gas importation and storage.
The Gas and Oil NPS is only intended to cover nationally significant infrastructure projects (NSIPs) which exceed the following thresholds set by the Department of Energy and Climate Change (DECC):
underground gas storage facilities and LNG facilities which have either:
- a storage or working capacity on completion that is expected to be at least 43 million standard cubic metres, or
- a projected delivery flow rate of at least 4.5 million standard cubic metres of gas per day;
- gas reception facilities with a projected maximum flow rate of at least 4.5 million standard cubic metres of gas per day;
gas transporter pipelines which are either:
- more than 800mm in diameter and more than 40km in length, or
- likely to have a significant effect on the environment; and
- have a design operating pressure of more than 7 bar gauge and are expected to convey gas for at least 50,000 potential customers; and
- pipelines over 10 miles long and their diversions (irrespective of length) that would otherwise require consent under section 1 of the Pipelines Act 1962.
With regard to pipelines over 10 miles long, the Gas and Oil NPS makes it clear that whilst these pipelines could carry different types of gas, fuel or chemicals, the Gas and Oil NPS only applies to pipelines which transport natural gas or oil. However, the Gas and Oil NPS may be useful in identifying impacts to be considered in respect of applications for pipelines intended to transport other substances.
The Gas and Oil NPS also clarifies that some pipelines which are not nationally significant infrastructure projects in their own right, or are not covered by the Gas and Oil NPS, may nevertheless be classed as "associated development" and be covered by a development consent granted for another nationally significant infrastructure project, such as a power station. More information on what constitutes "associated development" is available from the Department of Communities and Local Government.
If the proposed project does not exceed the thresholds set out above, or if it relates to an offshore gas storage facility, an offshore LNG unloading facility, or offshore oil and gas pipelines, planning and/or other consents will need to be obtained through the existing planning system involving the local planning authority as the decision maker (or the Secretary of State), or in the case of the offshore facilities, through DECC. The Gas and Oil NPS clarifies that any offshore gas storage facility which seeks to utilise a sub-sea storage area will require a lease from the Crown Estate.
The need for gas infrastructure projects has been demonstrated
The Gas and Oil NPS, together with the Overarching Energy NPS, instructs the IPC/MIPU to commence its assessment of any proposal to develop an NSIP on the basis that a significant need for the project has been demonstrated and as such there is a presumption that consent should be granted. The Gas and Oil NPS does not direct applicants to appropriate sites for such projects, but provides background information on the criteria that applicants should consider when choosing a site or route.
The IPC/MIPU and the project developer are directed to consider the various factors which are set out in the Gas and Oil NPS with respect to any application for consent to develop an NSIP. While the Gas and Oil NPS does not repeat the factors already addressed by the Overarching Energy NPS, such as climate change and good design principles, it provides a significant amount of technical detail in relation to site selection, noise, vibration and environmental impacts. An applicant is also required to assess the scope for mitigating any adverse impacts in its Environmental Statement. In its application for consent, the project developer may attribute the weight it believes appropriate to any of these factors and is not precluded from addressing any other factor it considers appropriate.
The decision making process will be streamlined
The intention behind the creation of the IPC/MIPU is to streamline and centralise the decision making process with respect to NSIPs. However, it is inevitable that the IPC/MIPU will need to interact with other regulatory agencies and will take on board their recommendations when considering an application. For instance, the IPC/MIPU is obliged to "consult" with the Health and Safety Executive (HSE) in relation to hazardous substances consent, "liaise" with the Environment Agency in relation to licensing water abstraction and discharging brine, and "consult" with the relevant marine agency and marine management agencies in relation to dredging. Development consent should not be refused unless the IPC/Secretary of State has good reason to believe that any necessary separate consent or permit would not subsequently be granted.
Requiring the IPC/MIPU to take a consultative approach may have an impact on the timing for decision making as it will, to some extent, be driven by the workrate of the relevant government agency. Consequently, the extent to which the IPC/MIPU can speed up the overall consent process for the development of NSIPs may be impeded by the existing operational procedures of the relevant government agencies. Should a decision be taken to grant development consent ahead of consulting or liaising with a government agency, there is a risk it may leave the project development consent open to legal challenge. For this reason, the Gas and Oil NPS, together with the Overarching Energy NPS, encourages applicants to consult the relevant regulatory agencies at an early stage.
In circumstances where the IPC/MIPU is not obliged to consult or liaise with other regulatory bodies with respect to an application for a proposed project it should make its decision in line with the processes set out in the Overarching Energy NPS and the Gas and Oil NPS. There is also helpful additional guidance available to the project developer in relation to certain infrastructure. For example, in relation to gas and oil pipelines, the IPC/Secretary of State may grant consent, in exceptional circumstances, for development of an oil and gas pipeline in nationally designated landscapes where it is in the public interest and the adverse effects on water resources, geology and soil are adequately mitigated.
Requirements of the EU Third Gas Directive
Article 4(2) of the Third Gas Directive requires EU Member States to ensure that procedures granting authorisations for natural gas facilities take into account the importance of any given project for the establishment of a single internal European gas market. Applicants seeking development consent should clarify how proposed developments will contribute to cross border gas supply and the development of a competitive EU-wide gas market. The IPC/Secretary of State should take the contribution any proposed natural gas infrastructure will make to the EU internal gas market into account when making decisions.
The development consent process will not exempt a project developer from the third party access regime. However, the usual exemptions in Article 36 of the Third Gas Directive for new infrastructure will apply and, if applicable to the NSIP in question, the project developer will have the benefit of these exemptions.
Summary of changes
The table below sets out the latest changes made following the conclusion of the second consultation in January 2011 to create the version of the NPS laid before Parliament for approval.
EU Third Gas Directive: A new section has been added to the Oil and Gas NPS to satisfy the requirements of the Third Gas Directive.
Gas and oil pipelines impacts - biodiversity, landscape and visual: This section has been revised to include impacts on biodiversity as well as landscape and visual impacts.