Electricity and Gas Transmission (Compensation) Bill

– in the House of Commons on 25th November 2022.

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Second Reading.

Photo of Liam Fox Liam Fox Conservative, North Somerset 9:35 am, 25th November 2022

I beg to move, That the Bill be now read a Second time.

Electricity transmission is something on which we all depend and, simultaneously, tend to take for granted. The upgrading of the network is necessary to ensure that we improve the efficiency and resilience of our system. It will enable us to improve our energy security by bringing in new capacity, such as in the nuclear field, and our renewable capacity by increasing the use of elements such as offshore wind. On that much, all hon. Members will agree.

At the same time, farmers, homeowners, local communities and individuals should expect to have their rights and interests protected while that programme unfolds, and to be treated fairly and equitably when disputes arise. It is the failure of those elements that necessitates today’s Bill. In the UK, National Grid owns and operates our electricity and natural gas transmission networks. It is one of the largest investor-owned utility companies in the world: in the United States, as well as operating transmission networks, the company produces and supplies electricity and gas, and provides both to customers in New York and Massachusetts.

Let me be clear to the shareholders of National Grid that it is the intransigence, abrasiveness and downright disrespect of elements of the company’s management that has led me to introduce the Bill, on behalf of not only my constituents who are currently affected but those of many other representatives in this House who will be affected in future. Where disputes arise between one of the world’s most powerful companies and our constituents, it is essential that we have a means of resolving them in a way that is clear, affordable, fair and enforceable.

I believe that the Government share those objectives, so the Bill, as with the Down Syndrome Act 2022 that I introduced last year, has been kept deliberately simple at this stage to enable us to reach agreement on the specific mechanisms that can be incorporated at later stages as the Bill progresses through Parliament. It is true that a range of dispute resolution mechanisms exist, but it is clear from experience that they are not capable of dealing in an acceptable way with disputes that arise. If they were, there would be no need for the Bill.

Photo of Gagan Mohindra Gagan Mohindra Conservative, South West Hertfordshire

I congratulate my right hon. Friend on his impassioned speech. Does he agree that we in this place should always encourage people to do the right thing, as the Bill hopefully will? I am concerned that it sounds, from his introduction, as though that company is not doing the right thing.

Photo of Liam Fox Liam Fox Conservative, North Somerset

I am not questioning whether the company wishes to do the right thing, but in practice it has not behaved in a way that is acceptable to me as a representative of the people of North Somerset. I therefore suggest that we need new mechanisms to ensure that what I regard as genuinely fair practice is enforceable. That is one of the problems with the current system. I shall now illustrate the generic case with some specific examples from the experiences of my constituents.

For those who are unfamiliar with the background, in preparation for the Hinkley C nuclear power station coming online, the Hinkley connection project is a new high-voltage electricity connection between Bridgwater and Seabank, near Avonmouth. The new connection will be 57 km long, consisting of 48.5 km of overhead lines and 8.5 km of underground cables, mainly through the Mendip hills area of outstanding natural beauty. The existing 132 kV power lines will be replaced, as they will be across the country, by new 400 kV overhead lines using very much larger T-pylons, with the removal of most of the existing pylon system, which we are used to seeing in our towns and countryside.

It is not my intention in the Bill to argue the pros and cons of the new pylon system, controversial though that it is, or to argue for the relative merits of pylons or undergrounding of new cables. My intention is to ensure that where the interests of our constituents are materially affected they are given due protection. A number of my constituents in North Somerset have been battling with National Grid for over 10 years now to try to protect their homes and livelihoods.

My first constituent’s circumstance has resulted in the value of their property being materially impacted by the project, which is perhaps an unavoidable consequence of this type of infrastructure upgrade. My second constituent is a farmer whose livelihood is being destroyed by the same scheme. In both cases, National Grid seems to believe that it has no responsibility to take due regard of the emotional, social or economic consequences facing my constituents, whose only redress is therefore through the courts at the Upper Tribunal. In the case of my first constituent, who was forced to pursue that route, that ended up costing them a staggering £200,000 in legal fees.

In that first case, the family bought their home in January 2008, with the intention of knocking down the old house and building a new one. They carried out all possible searches from a conveyancing perspective, as the project was their magnum opus that was going to use their life savings and ultimately provide their pension in years to come. The Hinkley scheme never showed up on any searches undertaken and, by its own admission, National Grid accepted that the Hinkley connection project would not have been visible in any searches undertaken at that point in time.

Once the project was formerly announced in 2010, my constituent made representations at every possible hearing, to both National Grid and the inspectorate, asking factual questions around pylon location and impact. For years, no one was able or willing to provide any specific answers or assurances on whether and to what degree the project would have a material impact on the value of their house. As hon. Members can appreciate, that caused, and is still causing, an unimaginable amount of stress for the family. The feeling of being effectively powerless in a stand-off with one of the world’s most powerful multinationals has left them with a level of fear and anxiety that I leave the House to imagine.

The detail of the scheme was to put two 132 kV lines under their drive, which includes their garage come office, and a 400 kV T-pylon close enough to the property that, were it to fall, would fall right to the edge of the house itself. That is in addition to building an access road that now abuts their property. Where once there were only fields and sheep, there will now be a massive new pylon outside their home.

Additionally, they have been served with restrictions around permitted development rights of their property and National Grid and supplying parties have been granted access rights to their property, which would allow them to break down their gate or knock down their garage and office in order to carry out any necessary reparations to the undergrounded line. Perhaps those are necessary rights, but they have a detrimental effect on the sale price of the property.

Although my constituents were constantly engaged with National Grid, all conversations were completely ineffectual as National Grid did not have to listen or provide any answers to their questions because it was able to point to the development consent order—the DCO—that seemingly gave it carte blanche to do what it wanted. Unlike other large infrastructure schemes such as High Speed 2 or Crossrail, no discretionary compensation scheme was established for the project, so National Grid has simply focused on what it has been legally allowed to do, with little regard for the impact on individuals’ existing properties, and irrespective of the personal or financial impact. Hon. Members may want to think about that in respect of future potential cases. Consequently, the only route left open for my constituent to protect their home and life savings was to pursue a blight claim through the Upper Tribunal—which for reasons that are readily apparent they did not want to do.

Given the rarity of statutory blight claims, my constituents recognised the enormous risk in undertaking such an action, and they did not take it lightly. However, since they had no other avenues to pursue, they were compelled to do something to avoid financial ruin. To be clear, all they were trying to protect was their right to sell their house at a fair market value at a time of their choosing. I would like to think that hon. Members on both sides of the House would regard that as a basic right.

The odds are stacked against individuals in such cases. Even the small win that my constituent made in the judgment—the recognition that there would be a 5% diminution in the value of their property—was pointless, because National Grid will no longer accept and pay compensation as it says that the rights that it now requires over the property have changed. A constant moving of the goalposts as well as a refusal to accept responsibility for its actions—or decisions that go against it—have been constant features in National Grid’s behaviour. Its response is all too typically to challenge individuals to take it to the Upper Tribunal, with a potentially huge new tranche of expense.

Photo of Jerome Mayhew Jerome Mayhew Conservative, Broadland

As the country moves to decarbonise and away from fossil fuels, a conservative estimate is that the requirement for electricity will double—it may triple—in the next 20 to 30 years, and an inevitable consequence is that we will need many more pylon routes. Does my right hon. Friend agree that this is therefore a particularly opportune Bill and that it is important for hon. Members who perhaps do not think it applies to them yet?

Photo of Liam Fox Liam Fox Conservative, North Somerset

I am extremely grateful to my hon. Friend for making that point so clearly. At the moment, it is a relatively small geographical problem that affects a relatively small number of us, but it is going to be a much bigger problem in the future, affecting many more constituencies across the country. As so often happens, we are able today to anticipate a problem and do something about it. What I hope will not happen—all too often it does—is that we try to kick it into the long grass. It is far better that we find a solution to the problem now that is fair, reasonable, enforceable and equitable and bring that forward with Government action. We otherwise face long fights on behalf of our constituents in the House and potentially through the legal system. The current system of forcing constituents to the Upper Tribunal is neither fair nor affordable, and access to justice is not possible where one side can use its financial and therefore legal might in effect to intimidate those who stand in their way. That is exactly the point that my hon. Friend was making.

My second constituent is a local North Somerset farmer who has some of his land adjacent to my first constituent. His family have been farming in the area for generations. As with so many of our farmers, they love and care for their land and the local environment, and they focus on farming in an environmentally friendly and regenerative manner. The preservation of soil is key to the whole business model. As a consequence of the scheme and the flagrant disregard for that preservation, his land has been ruined for generations to come. Haul roads have been constructed over peat bogs, and they have caused material drainage issues. National Grid has consistently refused to agree a workable drainage strategy. This will impact future yields and render it less productive and less valuable as farmable land, not just for a couple of years but for generations. What is worse is that a compensation scheme agreed with National Grid’s land agent at the start of the scheme has now been reneged on, as National Grid is now questioning the formula agreed by its own land agent. When my constituent challenged that approach, he was faced with a bullying and abrasive response, and is constantly told that he could pursue the matter through the courts, which, quite obviously, he is not in a position to do.

In addition, as a consequence of the company’s inadequate and seemingly ignorant and ill-thought-out approach towards the resettling of badgers, setts have been blocked off. That forced badgers on to his land and infected his herd—something he told the company could happen, but it chose not to listen. As someone who had never had a single case of TB on his farm for 30 years, he was forced to cull 110 cattle out of a herd of 350. Seventy of those were in calf, so not only did he lose a huge proportion of his stock but his stock has been massively affected for the next three years. In turn, that has cost him tens of thousands of pounds. And that is without taking on board the suffering farmers endure when they witness the suffering and slaughter of their own animals.

A third case involves another farmer across whose land an access road was driven. Promises were made to return the land to its previous condition, which was, incidentally, part of the best quality farming land in the area. When I visited the farm recently, I was horrified at the condition of the fields. Building debris was so widely scattered that it would be impossible to utilise a range of farming vehicles without undue damage. Yet again, the response from National Grid, or at least its local agents, was that it had done what was required of it and that if my constituent was not satisfied it would see them in court—a very regular chorus being developed in this particular song.

A fourth case involved an elderly constituent who has a single piece of land, which is her chief financial asset. This has effectively been taken out of use for the next seven years by National Grid perfectly legally as part of the access programme for the installation of the new pylons and underground cables. Again, there has been a callous disregard for the fact that this effectively renders her biggest source of potential income inaccessible. Here again, the response has been that if she is not happy, she can pursue the matter through the courts. The disregard for individual interests and natural justice appals me.

Members across the House will be able to see from these relatively simple examples a clear pattern of behaviour developing. Some might say that from the point of view of National Grid shareholders, the approach is not irrational, as they will be able to proceed with their electricity transmission project at minimal discretionary financial cost. The rest of us, however, will surely believe that we have to put in place measures to fulfil the four tests I set out earlier, giving our constituents a system of dispute resolution that is clear, affordable, fair and enforceable.

I am grateful to Ministers for the discussions that we have had thus far on the subject and their understanding that there is a clear problem that needs to be addressed. The current dispute resolution mechanisms are not adequate. That cannot be allowed to stand as the solution to the problem. A range of options is available which I hope we can continue to explore as we move towards the Committee stage and subsequent stages of the Bill. I have noticed in recent weeks a growing awareness from Members representing constituencies across the country who recognise that this will become a problem for them if we do not find adequate solutions now.

As I said at the beginning, we all understand the need for an effective, efficient and resilient electricity transmission system, but it cannot be built at the expense of our constituents and the natural justice to which they are undoubtedly entitled. We cannot allow large multinationals to bully those who have legitimate interests and grievances, and to use their financial, and therefore legal, might to crush resistance underfoot.

Today, my North Somerset constituents are, largely, the most affected, but many more constituencies will be affected in the future. We in this House have a duty to protect, in any situation, those who are weak from the excesses of those who are stronger, and to ensure that decency, social responsibility, rights of property owners and environmental protection are given their proper place. Last year, in the passing the Down Syndrome Act 2022, this House showed that it understood that it could unite for the common good. I ask colleagues to do the same today.

Photo of Bill Wiggin Bill Wiggin Chair, Committee of Selection, Chair, Committee of Selection, Chair, Committee of Selection 9:55 am, 25th November 2022

My right hon. Friend Dr Fox has proposed a mechanism to ensure fairer treatment for those whose rights or land are subject to acquisition. I declare my entry in the Register of Members’ Financial Interests: I have a wayleave on my little farm, and I receive money for that. It is not a great deal, but it is important to announce that, so that no one hears what I will say without knowing that.

My right hon. Friend’s Bill relates to projects that concern electricity and gas transmission. In the south of my constituency is the National Grid high-pressure gas pipeline, which runs underneath, or near to, Upton Bishop, where I live. Such projects are of vital national importance, and I would not wish them to be hampered by long, drawn-out negotiations between stakeholders. The time that the High Speed 2 rail link has taken to progress and its expense demonstrate the need for speed and efficiency when proceeding with publicly beneficial projects, but those who face vast inconvenience and an emotional impact as a result need to be treated as fairly as possible, and with the utmost consideration.

I was horrified to read in an article in Farmers Weekly that months, and even years, can pass without landowners seeing a penny of compensation when their land and access rights are subject to acquisition. It stated that, in some cases, people have been left waiting for up to 10 years for payment once a compulsory purchase order has been served.

Without a mechanism that is separate from the negotiations surrounding a purchase of land, landowners are forced to take disputes to the Upper Tribunal lands chamber. If they lose their case, they may be forced to pay the legal costs of the acquiring body. The main thrust of what my right hon. Friend said is that it is a David and Goliath-type contest that is deeply unfair to the David part—that is, the landowner. In complex cases, when business viability is called into question, that can amount to tens, or even hundreds, of thousands of pounds. That makes the legal route both expensive and risky, as my right hon. Friend pointed out. It is not fair that landowners who, through no fault of their own, are separated from their land or rights are dragged through a demoralising legal process. In many cases, they cannot even afford that, especially given that the outcome of legal proceedings are not certain, and the landowner may still feel aggrieved about the loss of his land in the first place.

Farmers are disproportionately affected by the projects that are addressed by the Bill. Agriculture accounts for 63% of land use in England, so farmer are, of course, most affected by gas and electricity supply lines. A farmer’s land, however, is also his greatest asset, and it is very difficult to quantify the cost of disruption that an infrastructure project may cause. The basic principle of compulsory purchase compensation is that the person affected should be returned to the position that they were in before the acquisition took place. For farmers, that is often not what happens. The separate components of compensation payments do not adequately address the injuries that farmers may face.

For example, not only do the huge 400kW pylons that are required to transmit electricity take up about 60 square meters during construction, but their placement reduces crop yields for years to come. In some cases, pylons are obstacles for farmers driving combine harvesters or other farm machinery. When builders put transmission lines in place, they may cause damage to crops or leave gates open, leading to animals escaping. My local paper, the Hereford Times, reports that at least one agricultural accident involving overhead lines, posing a threat to life for farmers and livestock, is reported nationwide every day. A one-off severance payment does not take those effects into account, as they are difficult to quantify.

The current system benefits only the acquirer of the land or rights. National Farmers Union rural surveyor Louise Staples has claimed:

“Acquirers have too much power. There should be a greater understanding that the purchase affects people’s homes, livelihoods and family history.”

I hope that any system proposed by the Secretary of State looks more favourably on farmers than the current system of negotiation, in which there is a huge imbalance of power.

Part of the south Wales gas pipeline, which transports high-pressure gas from Gloucestershire to Pembrokeshire —actually from Pembrokeshire to Gloucestershire, I suspect—runs through my constituency. Herefordshire is one of the main entry points to Wales, as the Wye valley is more suitable for infrastructure projects than the Cambrian mountains. For the same reason, the percentage of land used for agriculture in Herefordshire is far above the national average, so Herefordshire’s population density is very low—the fourth lowest of any county in England. That creates issues with gas and electricity provision, with a need for electricity cables that are not as high-voltage but are none the less disruptive, as they cover large distances between substations.

A 132 kV overhead cable runs from Herefordshire to Worcester, through the south of my constituency. Hon. Members will be familiar with overhead cables of that kind, as they are frequently held up by ugly steel lattice pylons, which can look very similar to 400 kV pylons. The network distributor, Western Power, published a document last year suggesting that the existing 66 kV lines are ageing and may be replaced by 132 kV lines. Of course that is welcome, because it is important that we maintain our electricity lines and that they be up to standard, but I am concerned that those whose livelihood will be affected by the works will not be compensated fairly.

Photo of Liam Fox Liam Fox Conservative, North Somerset

Does my hon. Friend agree that there is something strange in how there are built-in compensation mechanisms for projects such as HS2 and Crossrail, which tend to affect more urban populations, but there is little protection, if any, for projects such as those he describes, which affect more rural locations?

Photo of Bill Wiggin Bill Wiggin Chair, Committee of Selection, Chair, Committee of Selection, Chair, Committee of Selection

That is the reason I am here today: the system is skewed to disadvantage rural populations, who carry quite a lot of the burden of energy distribution. What we are looking for is fairness.

I praise the work that Western Power does in my constituency to supply homes with the energy that they need. I listened to my right hon. Friend’s speech about National Grid; I could not feel more differently about Western Power, a fantastic company that goes the extra mile for my constituents every time. I hope it is listening to this effusive praise, because I really love these guys—they are fantastic. However, the principle behind our debate is the need for compensation. Although Western Power has been fair in its dealings with me, I agree with my right hon. Friend that those who are subject to acquisitions of rights or land deserve fair compensation.

Photo of Flick Drummond Flick Drummond Conservative, Meon Valley 10:04 am, 25th November 2022

It is a pleasure to be called to speak in this debate. May I congratulate my right hon. Friend Dr Fox on introducing the Bill. We recently co-operated on what became the Down Syndrome Act 2022. He has again found an area where there is a need to support people through better legislation.

Representing a mostly rural constituency, I am aware of the need for ensuring a robust and resilient distribution network for our utilities. We are in that period of the year when strong winds and driving rain can threaten infrastructure, and thousands of miles of cable criss-cross the constituencies of everyone here today. The weather makes it more difficult to repair damage, so I thank the people who put a lot of hard work into mending our infrastructure. I appreciate the speed with which they are usually able to make repairs.

Given the challenges, naturally, the utilities will want to develop the infrastructure and build more resilient networks. There are also areas where development requires greater capacity. I am aware of one mooted development in Hampshire that is threatened by the lack of national grid and feeder capacity on the lower voltage lines. We cannot have development that is not backed by infrastructure at all times. However, it has to happen on a fair basis, and respect the communities and people whose lives could be temporarily or permanently disrupted by this work. There are also private companies trying to get into the market with their own speculative projects that give rise to applications for development and compulsory purchase.

I have a particular concern about wider issues of utility provision and the disruption that it can cause, which I think the Bill can help with. I am thinking of water. In Hampshire there are proposals to lay a pipeline across the county. A new reservoir is being built in my constituency to the north of Havant. Since that application was granted, there is a new proposal for a development consent order so that a pipeline can be built from that reservoir to the Otterbourne water treatment works in the constituency of my hon. Friend Steve Brine.

Southern Water is already sending letters to residents warning them that their land may be needed. I have been contacted by distressed constituents who are worried that they will be presented with compensation that does not represent the damage that the loss of the land will do to their business—as my right hon. Friend the Member for North Somerset said, that is particularly the case for farmers of animals. I was quite distressed to hear what my right hon. Friend said about the farmers. One of my constituents has some very valuable llamas and has no idea where she will put them. I hope that it will be possible to arrive at a pipeline route that interferes as little as possible with such constituents. There is some way to go before the route is finalised and the DCO begins.

If the Bill proceeds, I hope that it will be possible to have an amendment that considers water. It need not add to the complexity of the Bill or of the operation of the compensation mechanism. The movement of water is massively infrastructure-heavy. The work required is every bit as intrusive as that for gas pipelines and electricity pylons. I hope that Ministers will not only listen to pleas from my right hon. Friend for action on electricity and gas, but keep in mind water companies. We must have the infrastructure that we need for secure, modern utility provision, but things have to be done fairly. People who have to give up part of their land must be compensated fairly for the loss, and for any ongoing impact.

Photo of Selaine Saxby Selaine Saxby Conservative, North Devon 10:07 am, 25th November 2022

I congratulate my right hon. Friend Dr Fox on introducing the Bill. The transmission of electricity is at the heart of our energy security in the UK. Energy sources are an essential part of our move towards net zero, which is crucial if we are to limit the effects of climate change and insulate ourselves against shocks to the global energy market.

The south-west is a natural powerhouse, but the lack of efficient connections in the grid limits how much energy can be moved around the system. I have farmers in North Devon who have been working to install solar panels on their dairies, only to be prevented from connecting them because the national grid does not have enough capacity locally. Farmers who are working hard to provide the British public with high-quality British produce are being prevented from accessing more sustainable and secure forms of energy. That is contrary to what should be happening. Instead of putting in place barriers to the development of the national grid, we need to work on a strategy to increase capacity, while fully recognising the needs of landowners and people near to where that capacity may be installed.

The Celtic sea offers a fantastic opportunity to develop a significant amount of renewable energy for the UK. However, installing pylons should not be our default for increasing grid capacity. Undersea cables have been proven to work, with offshore wind sites and now with floating offshore wind. Residents along coasts in the UK have demonstrated their preference for a strategic offshore grid in place of pylon schemes. The effects of pylons on environmentally significant areas and areas of outstanding natural beauty are a concern, as they can damage the landscape and people’s access to the countryside—that is in addition to what we have seen in the horrific cases detailed by my right hon. Friend the Member for North Somerset. In North Devon, we are fortunate to have the UK’s oldest biosphere reserve, and to damage our biodiversity, outstanding landscapes or scientifically significant areas, such as Braunton Burrows, because of the lack of a strategy on how to upgrade our grid capacity effectively would be unforgivable. If we are considering a strategic offshore grid, we must ensure that it is installed sensitively.

We have made great strides towards a net zero future, but it is crucial that we do not unnecessarily disturb stored carbon. The ban on peat use in domestic gardening products recognises the benefits of keeping stored carbon in the peat, alongside the unique habitat that is provided to a diversity of species. As peat is the stored carbon of animals that died in wetlands millennia ago, carbon in our seabeds is stored from the marine lifecycle; phytoplankton photosynthesise and take carbon out of the atmosphere, and, through the lifecycle of the sea, it is ultimately stored in the seabed.

Storing carbon is one of the key pillars of reducing the effects of climate change. When we have incidents such as the recent methane gas leaks from the Nord Stream pipeline, which are estimated to release as much gas as one and a half days of global methane emissions, we need to ensure that we do not unnecessarily contribute to releasing stored fossil fuels. I would like budgets for installing an offshore strategic grid to include blue carbon when assessing how and where these cables could be installed, and I would like us to minimise blue carbon disruption through the use of cable corridors. There is much to celebrate as we develop an energy grid for the 21st century and beyond, but I very much hope that strategies and legislation will take into account our precious nature and landscapes, alongside increasing the capacity and efficiencies of our grid.

Photo of Aaron Bell Aaron Bell Conservative, Newcastle-under-Lyme 10:11 am, 25th November 2022

It is a pleasure to follow my hon. Friends the Members for North Devon (Selaine Saxby) and for North Herefordshire (Sir Bill Wiggin), and my right hon. Friend Dr Fox. There seems to be a theme; perhaps what we are debating only affects people in the north of their counties. Representing north Staffordshire, as I do in Newcastle-under-Lyme, it may be appropriate that I am speaking as well. It is always a pleasure to be here on a Friday doing important work on Bills such as this one. I pay tribute to everybody who is here doing so, particularly Ruth Jones. Instead of listening to me, she could be watching Gareth Bale—I wish Wales well and I am sure she is not following the game on her phone. [Laughter.]

I pay tribute to the Bill’s promoter, my right hon. Friend the Member for North Somerset, not only for what he is doing today, but for what he did with the Down Syndrome Act 2022. He referred to it today, as have colleagues, including my hon. Friend Mrs Drummond. I noticed the other day that he won campaigner of the year at The Spectator awards, which goes to show that the legislation will really make a difference to the lives of many people with Down’s syndrome and their families throughout the country. That is what these sitting Fridays are all about. If he could tell me how to win the ballot—he has been lucky twice in a row—that would be greatly appreciated.

My right hon. Friend is right to say that we need to upgrade our grid. As we move to decarbonise our sources of heat and electricity, more will be delivered through electricity, because heat pumps and transport—electric cars and so on—will put an increasing demand on the grid. The Government consultation on land rights and consents for electricity network infrastructure, which was held in August and September, summarised the scale and pace of change to electricity networks that is anticipated; peak electricity demand is expected to go from 58 GW in 2020 to between 130 GW and 190 GW in 2050 to meet both our net zero targets and, increasingly in the light of Putin’s illegal invasion of Ukraine, our energy security targets. The report went on to say:

“Over the next decade and beyond, this means an unprecedented build of new electricity network infrastructure and reinforcement, especially of the existing distribution network where between 200,000-600,000 km of additional distribution network cabling could be required by 2050.”

My right hon. Friend is at the sharp end of that, with his constituency near Hinkley Point C. That is because these big new developments will put a lot of demand on the capacity to get that electricity out and across the country more widely, as we on the Science and Technology Committee have heard in our current investigation into nuclear. We are generating a huge amount of electricity in one place in Hinkley, as we will be in Sizewell following the Chancellor’s welcome announcement last week that we are going ahead with that.

My right hon. Friend the Member for North Somerset is right to champion his constituents. Although I have not had the cases he has had, I am sure the criticism of National Grid is warranted, because we see this kind of thing all too often. I do not have the data, and one thing I noted when preparing for this debate is that we do not have good data about how often such consents are sought in our constituencies. Perhaps the Government could look to get Members of Parliament more information about how much of a problem this is in our areas.

The constituency represent is not nearly as rural as those of the Members who have spoken before me, but the principles remain the same—solid, Conservative principles of justice, fairness and people’s property rights. As my right hon. Friend said in his opening speech, sometimes it feels as if the odds are stacked against individuals. As my hon. Friend the Member for North Herefordshire said, the principles that ought to apply with compensation—putting people in the same position as they would otherwise have been in—often do not seem to be observed. That is why Bills such as this, which create independent means for people to seek redress and compensation at an appropriate level, are so important.

That does not make me a member of an anti-growth coalition, or anything like that. If we want infrastructure in this country—if we want to build things for the overall betterment of our national population and build national infrastructure—we need to be more constructive and work with people affected. My hon. Friend the Member for North Herefordshire said that HS2 was better than what we have here, but in truth HS2 has caused no end of trouble as it carves its way through the countryside, and, indeed, through Staffordshire.

People have to fight so hard even to get back to the position they were in. We perhaps need to offer them more than 100%, as France does. In France, they make sure that affected people are not only made whole, but get some compensation and acknowledgement of the disruption that is caused when their land is concreted over or they have to sell their house subject to compulsory purchase. In this country, we do not work with the grain enough when it comes to housing or infrastructure.

I welcome the Bill, which is all about ensuring that we treat our constituents fairly. My right hon. Friend the Member for North Somerset has been an undoubted champion for his constituents in this Bill and in the speech he made today. As he said, this will flow to other people. My hon. Friend the Member for Meon Valley said that this could usefully be extended to other utilities, not just water but perhaps broadband—sometimes the disruption that that causes is quite substantial. I look forward to further progress on the Bill, and to what more can be done in Committee. I welcome the fact that the Government will work with my right hon. Friend the Member for North Somerset in pursuing this important piece of legislation, and I hope that it goes through its further stages in this place and the other place.

Photo of Peter Gibson Peter Gibson Conservative, Darlington 10:17 am, 25th November 2022

I congratulate my right hon. Friend Dr Fox on bringing forward this Bill, and for his incredible luck in the private Members’ ballot in two consecutive parliamentary sessions. I know only too well what a privilege it is to guide a Bill through its legislative journey to the statute book. As has been mentioned, my right hon. Friend’s Down Syndrome Act was a hugely important piece of legislation. I am pleased to see that in his Bill for this Session, he is taking the opportunity to raise another important issue that impacts his constituents.

Following the declaration of interest by my hon. Friend Sir Bill Wiggin in respect of his wayleave agreement, I will mention that I was once lucky enough to receive a one-off payment from National Grid for a cable that crossed the end of my garden.

An unprecedented level of new power generation is planned over the next decade to meet the demand for electricity, and to meet our CO2 reduction targets. The national grid must therefore have sufficient capacity. As the cost of transmitting electricity ultimately passes to customers, it is important for National Grid to find the best way of connecting new sources of power generation consistent with its duty to maintain an efficient, co-ordinated and economical system of electricity transmission.

The national grid is a nationally significant piece of infrastructure, and as such, I know National Grid will seek to obtain from the outset, by negotiation, permanent land rights for all new electricity transmission assets. That is consistent with National Grid’s approach for new underground electricity cables and gas transmission pipelines, where permanent land rights are also sought and obtained. Once National Grid has identified a final route alignment for proposed new electricity transmission assets, it will seek to enter into an agreement to grant an easement with owners and tenants of the land across and within which the new electricity transmission assets may be constructed.

The agreement enables National Grid to take entry on to the land, with notice and following the grant of the development consent order, to construct the new electricity transmission assets. The agreements also provide for changes in the final route alignment within a specified corridor as a consequence of public consultation, and during construction as a consequence of engineering requirements, surveys, and other routing factors. One construction is completed, the agreements permit National Grid to call for an easement in respect of the new, as-built electricity transmission assets.

The payment schedule for new electricity transmission assets sets out the amounts that will be paid for an easement. In return for a signed agreement to grant an easement, National Grid will pay 50% of the easement consideration to the landowner. On entry for construction, a further 25% of the easement consideration is paid, and the final 25% will be paid if and when the easement is completed by National Grid. National Grid also offers incentive payments for the early return of signed agreements. Those incentives are set out in the payment schedule for new electricity transmission assets. They are available only during an 18-week period after a notified date, once agreements are issued by National Grid to landowners for their approval and signature.

After the agreement has been signed, up to either completion of the easement or expiry of the agreement itself, landowners, tenants and occupiers are restricted from doing anything that would adversely affect National Grid’s ability to take and benefit from the easement should it need to do so. If landowners transfer their interest in the affected land, they must oblige the incoming owners to enter into a new agreement with National Grid on exactly the same terms.

Where National Grid is unable to obtain a voluntary agreement from a third party following the grant of a development consent order for new electricity transmission assets, it will seek to acquire the relevant land, or land rights over the land, through the compulsory acquisition powers granted to it through the development consent order. A copy of the order and a compulsory acquisition notice will be served by National Grid on the relevant third party and the notice will be posted on, or near to, the relevant land. Compensation will then be calculated and, if due, payable to the relevant third party in accordance with the relevant provisions of the land compensation legislation.

Photo of Liam Fox Liam Fox Conservative, North Somerset

There is a dispute system in place, but where cases go to the Upper Tribunal, high legal costs are paid by not only our constituents but National Grid—costs that, as my hon. Friend has said, are ultimately passed on to electricity payers. Would it not therefore be in the interests of all parties to have a clear, efficient and affordable dispute resolution system, rather than cases going to the Upper Tribunal and ultimately costing those of us who pay our electricity bills, as with this system?

Photo of Peter Gibson Peter Gibson Conservative, Darlington

I am grateful for that intervention. My right hon. Friend makes an important point. My right hon. Friend’s Bill is born out of issues that his constituents have faced whereby they have been unable to get fair compensation for distributions to their property or business in cases where land will be, or has been, subject to the acquisition of rights or land, through compulsion or by agreement, for the purposes of electricity and gas transmission.

This is an important issue and I completely agree with my right hon. Friend that we need to see improvement in this area. The Bill seeks to establish an independent mechanism to determine claims for compensation in cases such as the ones that have been outlined, where people or businesses feel that they have been unfairly treated.

I know that the Minister will have listened closely to all of the contributions from Members across the House, and I look forward to hearing her response on the various points raised. I know, too, that my right hon. Friend the Member for North Somerset will be seeking members for his Bill Committee in due course, and I happily put my name forward.

Photo of James Daly James Daly Conservative, Bury North 10:23 am, 25th November 2022

It is an honour to speak in this debate. I was one of the sponsors of the Down Syndrome Act 2022, which was introduced by my right hon. Friend Dr Fox, and it was an honour to be part of that groundbreaking piece of legislation. I have learned more about how this Parliament works from him than from many other people here, and I thank him for that. I agree completely with everything that colleagues have said about this, but I have a few comments about development consent orders and how the principles behind the Bill can perhaps be developed.

My hon. Friend Aaron Bell—a good friend of mine—made an important point about how the principles may affect construction and other areas. We are talking about development consent orders for nationally significant projects, which generally involve constructions of a certain size— 48,000 square metres, I think. In my constituency, we are seeing a proliferation of 5G masts, and the construction of one, in Greenmount, was proposed for unregistered land. The mast itself would have been in a residential area and would have been bigger than the surrounding houses. If the planning application had been granted, there were no means for local people to claim compensation, or at least no means to challenge the application other than through the planning process.

For significant infrastructure projects—be they those that my hon. Friend the Member for Newcastle-under-Lyme mentioned, 5G masts or all sorts of other things—we must consider independent mechanisms that allow members of the public a way to claim compensation. Quite clearly, in the context that I am describing, a huge 5G mast suddenly towering over somebody’s house will have a huge impact on them.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

The 5G mast issue my hon. Friend is talking about is happening across our constituencies. They have presumed consent in most cases. Is he bidding to join the Bill Committee and table an amendment to include 5G masts?

Photo of James Daly James Daly Conservative, Bury North

As my right hon. Friend knows, I am open to anything, so I will certainly give that due consideration.

For infrastructure projects that are not related to residential use and have a negative impact on people’s everyday lives, their property and its value, my right hon. Friend Dr Fox has included in his Bill an important general principle that we can look at further. We need to find ways to ensure that constituents who are impacted by the actions of commercial bodies have the means by which to challenge and claim compensation. I wholeheartedly support the Bill, and I am very much open to all suggestions being put forward.

Photo of Jonathan Reynolds Jonathan Reynolds Shadow Secretary of State for Business and Industrial Strategy 10:27 am, 25th November 2022

I begin by congratulating Dr Fox on his success in the ballot and on bringing his Bill to the House today. He can perhaps now be described as a private Member’s Bill specialist, and the skill in that is to pick issues that allow the House to come to some sort of agreement and for which people want private Members’ Bills. I listened intently to what he had to say and—I will be honest with him—I have some concerns about his Bill, but I can tell him that I have amended my own speech in response to some of his points, so I genuinely listened to the case he put forward.

The right hon. Member gave a detailed account of how these matters have affected his constituents. He was right to say that the proposals are of national significance. That is because the debate comes at a time when this country faces several converging emergencies: the energy bills crisis is impacting deeply on millions of families and businesses across the country, the energy security crisis has been exposed by Russia’s illegal invasion of Ukraine and, of course, on the climate crisis, the UN tells us that we are on course for 2.8° C of catastrophic global warming.

Those crises all call for a sprint to renewable and nuclear energy. That is why the Labour party has set out our plans to make Britain a clean-energy superpower by 2030. I think we all agree that that is also the best way to keep energy bills low, tackle the climate emergency and create good jobs for the future. Achieving that mission is not just about building more kit—more nuclear plants, wind turbines or solar panels—but about establishing storage capacity to manage peaks in energy demand, new ways of balancing the grid and, most of all, very comprehensive improvements to our electricity infrastructure to expand the grid to new sources of energy. That is why the Bill is particularly relevant and important.

My understanding from listening to the right hon. Member is that, fundamentally, he wants to create an independent process whereby compensation can be determined for landowners whose land is required for the transmission of electricity or gas. I assume he intends that compensation to involve increasing the price currently paid for the land above the agricultural value that is commonly applied when such land is acquired through a compulsory purchase order. He made an excellent speech, and the way in which he articulated the specific cases of his constituents was very powerful—particularly when he pointed out that local property searches had not revealed the Hinkley infrastructure, which would impose a considerable burden on people.

I cannot say to the right hon. Member that I am fully convinced that what we need is new legislation to do this better. Expanding the transmission of electricity and gas is vital for the future health of our economy, not just as the bedrock of our clean energy future. In my role I have the privilege of meeting representatives of a range of companies every day, and they all tell me that one thing that holds them back from investing in the UK and growing their business is the time that it takes to secure the necessary expansions of the grid network. A few weeks ago, representatives of a company in Newcastle told me that it had been offered a grid connection by 2040.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

It is generous of the shadow Minister to give way again. I have been sitting here quietly listening to the debate, and I share some of his concerns about more regulation delaying the infrastructure projects, but I think that this proposal could actually speed them up, because in many cases it would remove the need for stuff to go to a tribunal. I do not think that the Bill is designed to delay—far from it—although I am sure that if I am speaking out of turn, my right hon. Friend Dr Fox will tell me so. I think that this could be the fairer mechanism to speed these projects up, rather their being subjected to a long tribunal process with the massive delays that all of us, as constituency Members, have experienced.

While I accept the point that the shadow Minister is making about his scepticism—a point from which I started—I fully support the Bill, and I think that, in the end, he will support it as well.

Photo of Jonathan Reynolds Jonathan Reynolds Shadow Secretary of State for Business and Industrial Strategy

I am grateful for the right hon. Gentleman’s intervention, because if it were clear that this was the way in which to resolve issues and speed the process up, that, for me, would be the deal-breaker. In the 12 years for which I have been in Parliament— I think the right hon. Gentleman will forgive me for saying this—I have often heard Conservative colleagues express strong opposition to housing developments, energy infrastructure, HS2 and other rail projects. It is important for us to get to the crux of the matter, which is whether this is about resolving things more quickly for people or whether it would delay the system further. If we are to meet the ambitions that Members on both sides of the House have held dear, we will all have to recognise the problems that are involved.

Photo of Liam Fox Liam Fox Conservative, North Somerset

I may be able to help the hon. Gentleman. The purpose of drafting the Bill in this way—without specific legal recommendations, and asking the Government to come up with a solution to the problem—is not to encumber us with further legislation but to open the way for the Government, for example, to introduce, under previous legislation, mechanisms that would enable disputes to be resolved more quickly. Let me say, for the avoidance of doubt, that the way to kill a private Member’s Bill is to include too many specific measures on Second Reading. Requiring the Government to come forward with a solution offers us options that will not necessarily impose on our constituents legislative burdens that are enforceable only through the courts.

Photo of Jonathan Reynolds Jonathan Reynolds Shadow Secretary of State for Business and Industrial Strategy

I did say that the right hon. Member was a private Member’s Bill specialist, and I think he has just given us all a little insight into how to handle these matters. I hope that once more detail is available, we will see an analysis of the way in which any changes in the process would affect our projections in respect of the future financial viability of grid expansion projects and key elements of national infrastructure.

I recognise the arguments advanced by many Members about how various issues involving infrastructure and other such matters have affected them and their constituents, and I hope I have been candid in expressing our concerns about how those might be overcome in future. I close my remarks by addressing some of the broader points this raises. If we are to deliver a clean and secure power system, we need the Government to address some of these issues, as there will clearly be major impediments if they are not addressed. We face considerable issues in providing business with stability and confidence to invest in this country. Members will be aware that we currently have the lowest level of business investment in the G7, so it is essential that we resolve such matters.

We need more clarity, leadership and direction from the Government. We do not need a Prime Minister who has to be dragged to COP27, an Environment Secretary who opposes solar energy or, frankly, a windfall tax that gives enormous, untargeted tax breaks for fossil fuel investment. Taking these matters seriously, and taking seriously the concerns that Members have articulated today, is essential, because achieving this is not just about new electricity or gas generation but about planning reform, new contracts for difference and the regulatory environment. The Bill sheds light on how we can bring local people on that journey.

Making sure these concerns are addressed is essential. Although the right hon. Member for North Somerset has done a tremendous job of moving the Bill’s Second Reading today, this debate is worthy of mainstream parliamentary time and requires a comprehensive approach from the Government, which is currently lacking.

If I could make one plea to the Minister, it would be to ask her to bring back the Energy Bill urgently. We will need some of the tools in that Bill if we are serious about cutting bills, creating jobs, growing our economy and providing energy security. Whether it is these matters about transmission or the other tools we need, we simply do not have the legislative foundations in place to meet the Government’s ambitions or the British people’s expectations.

Photo of Nusrat Ghani Nusrat Ghani The Minister of State, Department for Business, Energy and Industrial Strategy 10:36 am, 25th November 2022

I thank my right hon. Friend Dr Fox for raising awareness of this important issue and for his serious, measured and thoughtful contribution, as have been so many contributions from both sides of the House. He is, indeed, a private Member’s Bill specialist and, in my experience, it is best not to go against what he wants to achieve with his Bills. Hopefully I can satisfy him today.

I thank my hon. Friends the Members for Broadland (Jerome Mayhew), for North Herefordshire (Sir Bill Wiggin), for Meon Valley (Mrs Drummond), for North Devon (Selaine Saxby), for Newcastle-under-Lyme (Aaron Bell), for Darlington (Peter Gibson), for Southend West (Anna Firth), for Bury North (James Daly) and for South West Hertfordshire (Mr Mohindra), and my right hon. Friend Sir Mike Penning, for their thoughtful contributions. If I have time, I will go through each of their questions.

The Government have a clear long-term plan to accelerate our transition away from expensive fossil fuels and to meet our net zero targets. The electricity network is fundamental to this transition, and it needs to be transformed at an unprecedented scale and pace to allow the system to accommodate new renewable and low-carbon generation. The network also needs to accommodate an expected doubling in overall electricity demand by 2050, as we electrify sectors including transport, heat and industry. My right hon. Friend the Member for North Somerset identifies a clear problem that needs to be addressed.

To give colleagues an idea of the scale of the challenge we face in this country, the onshore electricity network had more than 20,000 km of high-voltage transmission cables and approximately 800,000 km of low-voltage distribution lines in 2021, which is enough to stretch around the world 20 times. By 2050, we will need between 1 million and 1.5 million km of distribution network cabling.

As more renewable generation joins the network, its physical capacity to transport electricity can be exceeded if new network infrastructure is not ready in time. National Grid, the electricity system operator, has to monitor and sometimes curtail generation to ensure it does not overload the network. Building new network infrastructure reduces these constraints and, therefore, the cost of managing them by enabling electricity to move more efficiently from where it is generated to areas of high demand.

However, it currently takes between 11 and 13 years to build or reinforce new onshore transmission network infrastructure, from initial planning to final completion and commissioning. Consequently, the system operator estimates that constraint costs funding via consumer bills could increase by £1 billion per year in 2022 to £4 billion per year in 2030. That explains why the electricity network is such a critical enabler of our net zero, affordability and energy security objectives and why the Government aim to dramatically accelerate these build timelines.

My right hon. Friend the Member for North Somerset mentioned the meetings he has had with the energy Minister, which I believe have been incredibly productive, and they will continue. He is right that we must bring people with us as we ramp up delivery of this critical infrastructure. He raised the important issue of determining claims for compensation in cases where land has been subject to the acquisition of rights or land either through compulsion or by agreement for the purposes of building electricity and gas transmission network infrastructure. I have highlighted the importance of network infrastructure for our climate and energy security ambitions. However, we recognise the concerns raised by my right hon. Friend. An unprecedented expansion of our electricity network is required, but the Government agree that this new network infrastructure must be built in a way that protects the rights of landowners and communities. If landowners are not happy with their settlements, there must be an avenue for redress.

I agree that the upper tribunal can be expensive for claimants who lose a case. While the vast majority of cases between the network operator and the landowner end in amicable agreement, disputes do arise. That is where the alternative dispute resolution that already exists and is in use can play a valuable role. It can provide a quicker, cheaper, more flexible route of resolving a dispute. The upper tribunal encourages the use of alternative dispute resolution before a case is referred to it. Indeed, failure by a party to pursue alternative dispute resolution without good reason can have cost implications in tribunal proceedings—for example, limiting the ability of a party to recover costs or potentially leading to an adverse cost order being made against the refusing party.

The Department for Business, Energy and Industrial Strategy published a call for evidence earlier this year seeking views on whether the current land rights and consenting processes for electricity network infrastructure are fit to accommodate the rapid, transformative change that will be required in the coming decades. Our call for evidence closed on 15 September, and increasing the use of alternative dispute resolution was mentioned by many respondents. The evidence suggests that the issue here is about both raising awareness of existing alternative dispute resolution and increasing its use where relevant.

We wish to see a clear, cheap, quick and enforceable solution, in line with what I understand to be my right hon. Friend’s objectives. We agree that there should be a quicker, affordable alternative to the upper tribunal readily available for landowners, and I thank my right hon. Friend for raising these issues for us to consider. As alternative dispute resolution mechanisms are already in use, we want to ensure that any legislative approach avoids prescribing a specific mechanism that duplicates existing options, creating unnecessary bureaucracy and costs for bill payers or taxpayers. In addition, different situations will suit different types of dispute resolution—for example, mediation, evaluation or arbitration. Prescribing a one-size-fits-all approach would likely increase costs and timescales for certain types of dispute.

In summary, I hope Members will agree that alternative dispute resolution should be encouraged. The Government are prepared to work with my right hon. Friend to develop the best solution to this issue, and we look forward to working with him in Committee.

As I have a few minutes, I will try to address some of the points raised by Members. My hon. Friend the Member for Darlington raised the issue of land rights, the rights of landowners and how legal costs can constrain constituents in bringing their cases forward. Hopefully, through this private Member’s Bill, we can try to resolve that. My hon. Friend the Member for Newcastle-under-Lyme talked about the luck it takes to win the ballot. I am not sure what is involved there, but he raised an important point about infrastructure, distribution, network cabling and compensation. We hope that, by taking the Bill forward, those issues can be addressed.

My hon. Friend the Member for Bury North talked about the mechanisms to allow constituents to access compensation. We have discussed how important it is to make people aware of where this compensation is available. He also mentioned 5G. That sits with the Department for Digital, Culture, Media and Sport, but he will no doubt get a response on that.

My hon. Friend the Member for North Devon talked about stored carbon in peat and seabed. As she is an expert on these issues, I am nervous to touch on what she already knows, but we will work with colleagues to understand their issues with regard to water infrastructure, and we encourage discussions on this matter. I will ensure that meetings take place with my right hon. Friend the Secretary of State, so that she can continue to represent her constituents on that issue. My hon. Friend the Member for North Herefordshire, who is a farmer not just a landowner, talked about compensation and access rights. Of course, he raised the grassroots perspective; we are all here to represent our constituents—the David against the Goliath—when we are dealing with big energy and infrastructure companies. He said that 63% of land is used by farmers, so it will be incredibly important to ensure that the new process puts in place arbitration, compensation and communication.

I assure my right hon. Friend the Member for North Somerset that we agree that he is right. We need to make sure that we have appropriate processes for compensation, and that any compulsion agreements are in line with the laws that are already established and in place. We want to make sure that the process is clear, affordable and fair. I recommit that the Government are prepared and will work with him to develop the best solution to the issue. We look forward to working with him in Committee and I hope that he is pleased with the outcome of the debate.

Photo of Liam Fox Liam Fox Conservative, North Somerset 10:45 am, 25th November 2022

With the leave of the House, I thank my hon. Friends Sir Bill Wiggin, for Meon Valley (Mrs Drummond), for North Devon (Selaine Saxby), for Newcastle-under-Lyme (Aaron Bell), for Darlington (Peter Gibson) and for Bury North (James Daly) for being ahead of the curve in recognising the problems that may be coming to their constituents at some point in the future and that now is the time to deal with the problem.

I also thank the shadow Minister, Jonathan Reynolds, for his broadly supportive approach and, especially, my hon. Friend the Minister for recognising that we have taken a consensual approach in the formation and writing of the Bill to give the Government maximum flexibility to meet the anxieties that have been expressed in the debate. I am afraid that I cannot give my hon. Friend the Member for Newcastle-under-Lyme any advice on how it is possible to come top of the ballot for two consecutive years. Had I such a mechanism, I assure him that having won every lottery available, I would be hardly likely to be here on a Friday morning.

I hope that the House will recognise that I am unlikely ever to be categorised as a class warrior in this place, and I recognise that we need to have development and renewal of the infrastructure in our country if we are to become the competitive, green, efficient and energy-independent nation that we all want to see. This debate is not about those things, however. It is about natural justice. Where disputes arise, powerful multinationals cannot be the judge and jury of the compensation that our constituents may or may not get in a dispute.

The current system that my hon. Friend the Minister described is not good enough. It is not working adequately, so we need a different system that is, as I set out, clear, so that people unequivocally know what their rights are; fair, so there is a balance between the public good and individual interest; affordable, because it cannot be right for the powerful to use their financial and therefore legal might to bully others into submission; and, above all, enforceable, because, as we discussed at length during the passage of the Down Syndrome Act 2022, there is no point having rights in this country if they are not enforceable. We have today identified a problem that exists and is likely to become more widespread if we do nothing about it. We can act now to deal with an injustice and put it right. Ultimately, what else are we in Parliament for?

Question put and agreed to.

Bill accordingly read a Second time; to stand committed to a Public Bill Committee (Standing Order No. 63).