Earl Russell:

Moved by Earl Russell

90: After Clause 28, insert the following new Clause—“Local Area Energy Plans(1) All local authorities and combined authorities must create a Local Area Energy Plan in order to inform their decisions about local electricity infrastructure requirements.(2) For the purposes of this section, a “Local Area Energy Plan” means an outline of how the relevant authority proposes to transition its area’s energy system to achieve net zero greenhouse gas emissions.”Member’s explanatory statement This new Clause would require all local and combined authorities to develop Local Area Energy Plans which set out how they will meet their Net Zero goals.

My Lords, I open this group of amendments, which are all on local energy plans; my Amendment proposes to insert a crucial new Clause after Clause 28 of the Bill. It would mandate that all local authorities and combined authorities must create a local area energy plan.

Considering the late hour, I will give a slightly condensed version of my original speech. I also express my strong support for the other amendment in this group, Amendment 177, tabled by the noble Lord, Lord Ravensdale, and supported by the noble Lord, Lord Hunt. This amendment would require the Secretary of State to publish vital guidance for local authorities on local area energy plans within 12 months of the Act being passed. To my mind, that is almost like the flipside of the same coin to what I am asking. The amendment that I have tabled and this amendment would work well together, complement each other and make each stronger than they would be without the other. From my point of view, it would be good if it was possible to progress both of the amendments in this group.

I do not really want to go into too much detail. Everybody knows what local area energy plans are. They are vital to devolving these tasks down to local authorities, including local people. They work really well; they are powerful. It is really good that we speak to and include local people and that they have a say, and it is good that we take account of local peoples’ needs and what is happening in local areas. It is good that we do this level of granular work on the ground and talk to local people. These plans are happening in some places: obviously in Wales, and there are some other places where councils are voluntarily doing these things, whether that is in London or other metropolitan authorities.

What does not exist in legislation is a mandated requirement for these things to be done or a mandated support to help local authorities to do these things. Were that to happen, it would help this Government to meet their environment and climate change targets. Frankly, I do not know how we got to where we are without having it in this Bill. I wonder whether that is purely just an oversight.

From my point of view, I stand ready to work with the Minister alongside the noble Lord, Lord Ravensdale. We would like to include this in the Bill. We feel that this would fit within the Bill, help to deliver targets, help us to get to where we need to be and help to empower our local authorities. I will leave it at that considering the late hour that we are sitting, but I genuinely think that this would help all round. I beg to move.

My Lords, I speak to Amendment 177 in my name and declare my interests as a chief engineer working for AtkinsRéalis and as a director of Peers for the Planet. I thank the noble Lord, Lord Hunt, for his support for the amendment.

I start by saying that I completely agree with what the noble Earl, Lord Russell, just said. I view these amendments as very complementary in terms of local area energy planning. This has to be a staged approach. We first need that guidance set out for local authorities, so that we have a consistent approach to planning but, ultimately, we need a funded programme with funding available to local authorities to enable them to undertake these plans and get to the place where we need to be with the noble Earl’s amendment. Therefore, they are very complementary in that sense.

To add to what the noble Earl, Lord Russell, said, I put this amendment forward to the then Energy Bill a couple of years ago. It is worth reflecting on what we have seen so far in terms of the energy transition, which is a very top-down driven approach. However, we have seen some really good progress since the Energy Act. We have had the formation of the National Energy System Operator, the NESO. We have started to see that thinking about flow-down to regions and local areas, with the formation of the regional energy strategic planner role, the RESP.

However, there is a missing piece of the puzzle in terms of the flow-down to local areas: the bottom tier, which is what the local area energy plan fulfils. In terms of spearheading the transition, it is really important that we get this joined-up view of the governance system and that we have some guidance for local area energy plans. As the Minister knows, this is not a conceptual approach—it is a well-tested road. In fact, since the end of last year, these have now been rolled out and completed for all 22 Welsh councils. There is a funded programme, a technical adviser to ensure coherence in the Energy Systems Catapult and there is that guidance to ensure a systems approach. Now that they have that basis, there is then flow-up to their own national plan as well, which offers great benefits.

This amendment would put a duty on the Secretary of State to publish guidance for local authorities on local area energy planning and to clarify some of the criteria that should be included with any guidance. This is based on the Energy Systems Catapult guidance and includes how local area energy plans can contribute to meeting our net-zero environmental and adaptation targets.

I will briefly illustrate one of the reasons we need this. The pilots undertaken in the UK, in Newcastle, Bridgend and Bury in Manchester, divided each area into zones suitable for different types of heating technologies. The balance of technologies across the three areas shows how different areas can be. In Newcastle, the plan found that roughly half the homes could be heated by a heat network, in Bury it was less than 30% and in Bridgend it was 15%. In Bridgend, a far higher proportion of homes would need to be heated with high-temperature heat pumps to save on the extra expense of retrofitting insulation in its poorer-quality housing stock.

This illustrates the importance of the approach. Local authorities have the best view of their local areas and a joined-up, co-ordinated approach to planning, led by government and providing local authorities with the support they need, could save tens of billions of pounds through the transition, compared with organic, unco-ordinated approaches to energy planning. It was also a key recommendation from some regional work we did in the Midlands Engine last year. In the Midlands Engine’s Energy Security white paper, that was one of the key recommendations in terms of getting local planning and join-up in there.

To finish, local area energy plans are crucial to a joined-up systems view of the energy transition, ensuring that we have the view from the ground to inform the national plan, and to have a properly joined-up view of energy systems governance—from local plans through to regional plans, right up to the strategic spatial energy plan to govern the system at a national level. In accepting this amendment, the Government would demonstrate their buy-in to the process and take a critical first step. By providing guidance, they could start to ensure that a coherent set of plans are being developed by local authorities. A funded programme and a technical adviser to ensure consistency and join-up could follow. This is a great opportunity for the Government to get energy planning moving at a local level and ensure coherence and systems join-up. I look forward to working with the Minister and the noble Earl on this.

My Lords, I offer my strongest possible support for Amendment 90 in the name of the noble Earl, Lord Russell, to which I have attached my name, and some slightly qualified support for Amendment 177, which we have just heard about from the noble Lord, Lord Ravensdale.

Coincidentally, and entirely without prompting from me, I started the day—rather a long time ago now—speaking to a senior civil servant. They said to me that they thought the great malaise of the UK was people’s lack of a sense of agency—a lack of ability to step up, take control and change what is around them and the direction of the country. This amendment, starting with the local and saying, “Here in your community you can democratically work through your council, local authority and combined authority to decide how to deliver your energy” is the perfect way to start to address those issues.

We are the most centralised polity in western Europe: power and resources are overwhelmingly concentrated here in Westminster. We have almost universal agreement that we have to have an energy transition. This is a major infrastructure element in all our lives, as we have been discussing this evening. We also must have a just transition, so that no community is left behind. Every community needs the opportunity to make plans for its energy future, and that is exactly what Amendment 90 seeks to achieve.

I note that a great deal of work and resources have been put into this over a long period of time. The Centre for Climate Engagement at the University of Cambridge, funded by Innovate UK under the Net Zero Living programme, is building on the work of the Skidmore review—we are talking about cross-party approaches across all Benches—which emphasised the importance of local government, leadership and place-based actions in dealing with the climate emergency.

This goes back a very long way. Green councillor Andrew Cooper, who was working through the European Committee of the Regions, got the UN COP process to acknowledge locally determined contributions. Everyone has heard of nationally determined contributions, but that was about locally determined contributions. Of course, the energy system is only part of this, but it is a very crucial part that impacts people’s lives and communities and on what they look like.

Your Lordships’ House has, in a very long wrestle with two successive Governments, finally got an acknowledgement of the importance of community energy. What I think we would see going forward is local authorities and combined authorities being very keen to encourage and support community energy. That of course is where we can see public support and financial returns growing. This is not about some giant multinational company coming and landing on your community, but about your community saying, “Right, how do we want to generate our energy?” That has to be the foundation.

I am broadly in favour of Amendment 177, but my question is around the weight and shape of the word “guidance”. We are talking about local energy plans, and anything provided from the centre should be support and not—as we see, for example, in planning and with housing allocations—direction. If it is indeed guidance, Amendment 177 is pointing us in the right direction. Together, these two amendments are crucial and I can see no reason for the Government not to accept them.

My Lords, I support the Amendment from the noble Lord, Lord Ravensdale, to which I have added my name. I am also very sympathetic to the amendment tabled by the noble Earl, Lord Russell.

The noble Baroness, Lady Bennett, raised a very interesting question about the centralisation of this country. In one sense, this Bill is about further centralisation when it comes to major infrastructure projects, which are so crucial to our growth. In essence, in the housing agenda, as well as with a lot of energy infrastructure projects, local government has not been very helpful and has been obstructive. If we believe that growth is a strategic aim of government, as I believe it to be, stronger central direction is vital. The question, however, is whether it can be complemented by local initiatives, which do indeed give local people ownership. That is where I agree with noble Baroness, Lady Bennett: community energy schemes are a fantastic way to leverage support from local people for the kinds of changes that we want to make to our energy infrastructure.

The noble Lord, Lord Ravensdale, obviously speaks with great authority as an energy expert, but he has also played a hugely important leading role in the Midlands Engine. He chaired the Midlands Energy Security Taskforce, which of course strongly supports local area energy plans.

When I was a Minister at DESNZ, I became very much aware of the potential of local community-based energy projects. I remember one visit to my own city of Birmingham, under the auspices of Footsteps: Faiths for a Low Carbon Future, when I met a number of local groups that were dedicated to community green energy projects but were seeking support from agencies at the centre to deliver something tangible. Interestingly, the MECC Trust, based in Balsall Heath, is hosting the launch by the Lord Mayor of Birmingham, in a couple of weeks’ time, of Birmingham’s first net-zero retrofit demonstrator community hub. The potential of hundreds of projects such as this, up and down the country, is very clear.

The amendment that the Government brought to the then Great British Energy Bill, which added projects involving or benefiting local communities to the crucial objective section, was very important. Great British Energy has made it clear that it will work with local energy groups, councils and mayors to fund and support community-led energy projects.

Noble Lords will be aware of recent decisions by some local authorities to roll back commitments in relation to net zero. Ironically, this is taking place as the scientific evidence of the impact of climate change becomes ever clearer. I do not think we can let this go by default. In essence, the noble Baroness asked: what does guidance mean? I think you really have to put the two together. I take the amendment of the noble Earl, Lord Russell, to be a statutory requirement on local authorities to encourage and develop local energy plans. I think that is really important now, in the light of some decisions being made by local authorities. Then, it seems to me, the guidance that we are suggesting fits into that structure.

I hope that the Government will be sympathetic to the need to make sure that local authorities do not pass up the opportunity to support local community energy groups.

My Lords, this group of amendments relates to the development and implementation of local area energy plans. The proposals raise important questions about the role of local authorities in our transition to a decarbonised, secure and efficient energy system. We have heard some thoughtful contributions about the tensions between local and central government, but also of the enormous potential when the right balance can be struck between the two.

Let me begin with Amendment 90, in the name of the noble Earl, Lord Russell, which would require all local authorities to prepare and publish local area energy plans. These plans would outline current and future energy needs and the decarbonisation pathways to meet them. The underlying intent here is one we can all recognise. The energy transition cannot be delivered only centrally; local authorities must have a clear understanding of their energy demands and the means to meet them sustainably. The noble Earl, Lord Russell, made a number of good points, reinforced by the noble Lord, Lord Hunt of Kings Heath, on which we might all agree in principle.

However, while we acknowledge the ambition behind this amendment, we would caution against placing an additional statutory duty on all local authorities, particularly at a time when many face stretched resources and competing priorities. A blanket requirement risks creating a burden of compliance that may prove challenging for councils already struggling with core service delivery. We must ensure that our expectations of local government are realistic, proportionate and backed with adequate support.

Amendment 177, tabled by the noble Lord, Lord Ravensdale, seeks to define the consultation and approval process for local area energy plans and mandates the provision of guidance to assist local authorities in their preparation. We recognise the positive intention here to provide clarity, consistency and technical support to authorities seeking to engage with this important agenda. This amendment also aims to widen the uptake of such planning and to define better the role of local authorities in delivering the future energy system. Those are commendable aims. While we must avoid onerous procedural hurdles or risk diverting local effort away from practical delivery into process-heavy reporting, we hope the Minister will consider this amendment carefully.

In conclusion, these amendments rightly draw attention to the importance of empowering local authorities in the energy transition. I welcome the debate and the ideas put forward, but urge a cautious, pragmatic approach. I look forward to the Minister’s response and any reassurances he can give on the Government’s direction in this space.

My Lords, I start with Amendments 90 and 177, which relate to local area energy plans. I thank the noble Earl, Lord Russell, the noble Baroness, Lady Bennett, and the noble Lords, Ravensdale and Lord Hunt of Kings Heath, for tabling these amendments.

Amendment 90, tabled by the noble Earl, Lord Russell, seeks to require all local authorities and combined authorities to produce a local area energy plan. The Government are committed to working in partnership with local government, in recognition of the essential role that local places play in accelerating to net zero and supercharging our mission to deliver clean power by 2030. We recognise that, in support of this role, some local authorities have already produced local area energy plans and have used them to plan for the investment they need to support the energy transition and deliver net zero in their areas. We welcome the work that many local authorities have undertaken to develop and deliver their local energy plans. Local authorities may well be considering how planning their future energy needs may form part of their local growth plans or help contribute to Ofgem and NESO’s work on regional energy strategic plans.

However, this is not the right time to place further burdens on local authorities, while the approach to energy planning is still under development. We are considering how these plans might align with a range of regional and national plans, including the regional energy strategic plans, the warm homes plan, heat network zoning and Great British Energy’s local work. With that in mind, we continue to consider the potential benefit of local net-zero plans, working with partners across central and local government such as the local net-zero hubs, Great British Energy, NESO, Ofgem and Innovate UK.

We are also learning from the work of several local authorities in England which have already undertaken to develop their own plans, in recognition of the important lessons that can be learned from local authorities. In the meantime, local authorities that wish to assess whether energy planning fits with their wider strategic plans can access a range of support to help them develop local plans, including the tools and advice available on the Net Zero Go digital platform, supported by the department and the advice and support available to them from their local net-zero hubs.

Finally, it should be noted that many areas of the country have multiple tiers of local government. The amendment as drafted risks duplication of effort and the production of overlapping plans covering the same geography. I hope that the noble Earl, Lord Russell, and the noble Baroness, Lady Bennett, are satisfied with our response. I kindly ask that the noble Earl begs leave to withdraw the amendment.

Finally, I turn to Amendment 177, tabled by the noble Lord, Lord Ravensdale, and my noble friend Lord Hunt of Kings Heath. It seeks to require government to develop and publish guidance on local area energy planning for use by local authorities. Many local authorities say that they are using local area energy plans to plan for an investment in energy and support the transition of local communities to net zero. However, as previously said, this is not the right time for government to produce national guidance for local area energy plans or require that local authorities have regard to such advice at a time when the approach to energy planning is still being developed. We would need to consider how local area energy planning might fit with the products of a range of regional and national plans, such as the warm homes plan, heat network zoning, Great British Energy’s local work and NESO’s regional energy strategic plans. It is not yet clear what role local area energy planning will play within these wider strategic plans. It is not the right time to publish guidance that may well be superseded.

As it is, local authorities already have access to guidance and support on net-zero issues, including energy planning. This includes Net Zero Go, as mentioned before, funded by DESNZ, which provides a library of free tools and guidance for local authorities. They also have access to advice and support from the five local net-zero hubs funded by DESNZ, which have already supported a number of local authorities in the development of their local area energy plans. I hope that the noble Lord, Lord Ravensdale, and my noble friend Lord Hunt of Kings Heath, are satisfied with our response.

I welcome the Minister’s response to my Amendment and the amendment in the name of the noble Lord, Lord Ravensdale. However, I am hearing from the Minister that this is not the right time to do this stuff. I understand that the Government are actively drawing up different strings and bits of policy and bringing them together. However, if now is not the right time, when might be the right time?

The Minister says that the Government are drawing together policy but also that there are loads of policy guidance available for local authorities that want to do this. The two statements are almost contradictory. Now is not the right time for the Government to give guidance, but guidance is available to any local authorities that want it. My worry is that this leads to guidance that is much more open to interpretation, which the Government do not have proper control of and which could be followed in multiple different ways without the Government having control over it. I strongly ask the Minister to think again on these matters. These are really important issues. I recognise that the Government are forming policy, but forming policy and working with local authorities are not contradictory things. These are everyday matters of government.

I thank the Minister for his response but call on the Government to think again.

I appreciate the noble Earl’s contribution, but I politely disagree in that there is a lot of advice and support from local net-zero hubs funded by DESNZ. I understand and sympathise with what he is saying. We have all said today that we want to get moving as fast as we can, in a speedy manner, and to grow. This is all part of the agenda. We want to make sure that we get things right, be concise and have the right level of engagement and consultation, to ensure that when we have the clear plan moving forward it is well understood and implemented and does not have unintended implications or consequences.

I want to complement what the noble Earl just said. A couple of years back, when I raised this as part of the Energy Act 2023, I remember being given a similar response: this was still being considered by the Government as part of how it would fit into the bigger picture. But I think the Government need to recognise the real importance of that governance-level flow-down from national to regional to local, the importance of local understanding in this picture and the real priority that needs to be placed on developing this guidance and strategy for local areas to take it forward. I hope the Minister will reflect on that.

I take note of the noble Lord, Lord Ravensdale, complementing the noble Earl, Lord Russell, and I recognise that there is a lot of work to do. I appreciate that the noble Lord has raised this before, but now we actually have a Planning and Infrastructure Bill which will very much fix the foundations of the whole growth to net zero and clean energy 2030.

My final and important point on this is that now is not the right time because we do not want to put further burdens on local authorities while we are still developing and finalising our energy planning. That is still under development, but I reassure the noble Lord that we are on it. We want to make sure that this happens as fast as possible, and this Bill will help us to change a lot of the infrastructure, thinking and systems in place in order for our country to grow.

I withdraw my Amendment.

Amendment 90 withdrawn.

Amendments 91 to 94B not moved.