Planning law and heat networks – navigating the interface (Part 1 of 3)

Written by Lucy Thomas, Louise Mansfield, Carrie Davies, and Joseph Halawin.

The regulatory landscape for heat networks is evolving. In previous articles we have looked at the possible effects of the introduction of the Warm Homes Plan and proposals for heat network zoning and the fundamental importance of demand assurance for growth of the district energy sector.

We have noted that there are some potential gaps in the regulatory framework that may prevent the sector delivering on net zero targets. 

In a series of three articles, we consider the extent to which the planning framework, Building Regulations, proposed new Installation and Maintenance Licensing Regulations, and the proposed Heat Network Zoning Regulations provide the tools necessary to achieve the government’s goals for delivering heat networks at pace and scale. 

In this first article, we consider what aspects of the planning regime will apply to heat networks being delivered in heat network zones.

In the second article we consider the role of the local planning authority in heat network zoning and ways in which Zone Coordination Bodies and local planning authorities might work together, and in the third article we consider other tools at the disposal of Local Authorities to support delivery of heat networks.

Will the proposed Heat Network Installation and Maintenance Licencing regime replace the need for planning permission for a heat network?

The Energy Act 2023 (“Energy Act”) provides for regulations establishing a framework under which a developer of a heat network may be granted an “Installation and Maintenance Licence”. However, the expectation is that it is more likely to operate as something developers can choose to apply for where the additional statutory powers will genuinely assist in delivering a project. 

Whilst the Energy Act also contains enabling powers that would allow regulations to be made permitting certain works to proceed without planning permission, the most recent consultation on the draft regulations for installation and maintenance licensing indicates that this is not the direction being taken at this stage.

From the draft we have seen, the proposed installation and maintenance licencing regime is about granting statutory powers to install and maintain infrastructure, whereas planning permission determines whether the proposed development is acceptable in planning terms. Therefore, the licensing regime does not appear to be intended to replace the need for planning permission. 

In fact, the licence and the planning system appear to be serving two different purposes - the licence is about granting statutory powers to install and maintain infrastructure while planning permission is about determining whether the proposed development is acceptable in planning terms.

1. to break open the surface of a street; 
2. to install pipework and associated equipment beneath the highway; and 
3. ongoing rights to enter streets for maintenance, repair and improvement works once the network is operational.

These rights will likely extend to carrying out similar works on "transport land" i.e.  land that is used primarily for railways, tramways or waterways.

Therefore, the current installation and maintenance regulations suggest that holding a licence is not going to replace the need for planning permission and that developers will still need to obtain planning permission in the usual way. 

Will heat network developers and operators benefit from permitted development rights in the same way that statutory undertakers do?

As readers will be aware, some utility operators already benefit from extensive permitted development rights. For example, electronic communications operators benefit from permitted development rights enabling certain telecommunications infrastructure, such as masts, to be installed without the need for a full planning application in every case.

Although the Energy Act contains powers that enable the Secretary of State to make regulations in this area, there has been no indication that such regulations are currently being considered for heat networks.   

Must a local planning authority grant permission for a heat network if it sits within a Zone?

Even if a planned heat network is located within a designated heat network zone, this does not mean that planning permission is guaranteed. Planning decisions will continue to be made under the existing planning framework and local planning authorities will not be mandated to automatically issue planning permission for heat networks in zones designated by Zone Coordination Bodies (“ZCBs”).

Under section 38(6) of the Planning and Compulsory Purchase Act 2004, planning applications must be determined in accordance with the development plan (i.e. the Local Plan) unless material considerations indicate otherwise. Therefore, the approach will depend on what is contained within the Local Plan.

Many planning authorities already have policies supporting decentralised energy networks, district heating and wider low-carbon infrastructure. Where a proposed heat network aligns with existing policies in a local area, that is likely to weigh in favour of granting planning permission.

Where a Local Authority does not yet have local policies encouraging heat networks the emerging NPPF may be helpful because, as we have noted, it is expected to be supportive of decentralised energy infrastructure, including district heat networks and the NPPF is an important material consideration in the determination of planning applications. The consultation draft NPPF encourages planning authorities to:

"take advantage of opportunities to draw low carbon energy from decentralised networks (such as district heat networks), where these are available, and to co-locate energy and heat generators and users, especially to take advantage of suppliers of surplus heat and energy."

That said, planning authorities will still have to consider the proposed heat network against the full range of planning considerations including the principle of development, appropriateness of location, whether the route is consistent with the Local Plan, and whether it supports or conflicts with wider regeneration objectives. 

Therefore, designation of a heat network zone does not automatically guarantee that planning permission will be granted for all, or parts, of the proposed heat network. However, the fact that the proposed heat network is within a designated zone may be capable of being a material consideration that the local planning authority must weigh up as part of its decision-making process. 

Conclusion

The Energy Act does not remove the planning system from the picture. If anything, it makes effective planning even more important. Successful delivery of heat networks in zones is likely to depend on planning policy, zoning, licensing and local collaboration all working together to create a clear and deliverable framework for heat network investment.

If you would like to discuss any of the issues raised in this article please contact  Lucy Thomas, Louise Mansfield, or Carrie Davies, who would be happy to discuss.

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