MPs on the Housing, Communities and Local Government Select Committee have been considering the planning rules for fracking. There has been plenty of speculation about the impact Brexit will have on economic growth – arising from various assumptions about whether trading opportunities will be enhanced or impaired. But the extent to which the shale revolution can be embraced is another huge factor in terms of whether our economic growth will be sluggish or robust over the next few years. In the United States, it is estimated that shale is contributing a 0.5 per cent a year increase to GDP and will continue to do so for the next ten years. EY suggest it could create 64,000 new jobs in the UK.
Jim Ratcliffe, the head of chemical giant Ineos, makes the interesting point that fracking could particularly give an economic boost to the north. Lancashire deos seem to be ahead of the pack. He says that “platitudes” of George Osborne’s Northern Powerhouse will not be effective, (“I mean, apart from a banner headline, what on earth does that mean?”) but that shale could be. In America, the price of gas has fallen by more than 60 per cent, providing a renaissance of manufacturing investment:
“The US now has just about the cheapest energy in the world — and it has $150bn of investment on the slate to build chemical facilities. And then you’ve got the steel industry, and the car industry, and the power industry, all off the back of the fact that their energy prices are much lower.”
As well as rebalancing the economy, there would be the fall in domestic fuel prices – helping the poorest the most. There is also the environmental benefit with the reduction in carbon emissions, and the political benefit of being less reliant on Russia and Saudi Arabia.
Of course, there have been lots of concerns raised about water contamination, earthquakes and air pollution. But the evidence of the United States is that these have been greatly exaggerated.
So far as earthquakes are concerned, a report by the Royal Society and Royal Academy of Engineering states that:
“The UK has lived with seismicity induced by coal mining activities or the settlement of abandoned mines for a long time. British Geological Survey records indicate that coal mining-related seismicity is generally of smaller magnitude than natural seismicity and no larger than 4 ML . Seismicity induced by hydraulic fracturing is likely to be of even smaller magnitude. There is an emerging consensus that the magnitude of seismicity induced by hydraulic fracturing would be no greater than 3 ML (felt by few people and resulting in negligible, if any, surface impacts). Recent seismicity induced by hydraulic fracturing in the UK was of magnitude 2.3 ML and 1.5 ML (unlikely to be felt by anyone). The risk of seismicity induced by hydraulic fracturing can be reduced by traffic light monitoring systems that use real-time seismic monitoring so that operators can respond promptly.”
The visual impact is also pretty modest – this illustration gives a comparison of the scale. 400 well pads across the UK would be enough to reduce our gas imports by half. Each pad would be less than the size of two football pitches – and have a set of wellheads.
I think the real problem is that the word “fracking” sounds a bit scary.
Anyway, there is some prospect of greater progress with a Government consultation “on the principle of whether the early stages of shale exploration should be treated as permitted development.”
Ken Cronin, the Chief Executive, UK Onshore Oil and Gas told the Select Committee:
“The problem is that we quite often concentrate on the council planning bit in the middle, but we are experiencing delays all the way through the process. When we first go into a local council to ask for a scoping opinion, whether it is an EIA development or not, the actual decision-making process is much longer than the statutory timescales. When you get to a decision, it is quite often against the planning officer recommendation. When you get to talking about planning conditions, that takes an enormous amount of time as well. It is speed, but it is also efficiency. The process has now gone from an acceptable three or four months to a very unacceptable 18 months in total.”
Matt Lambert of Cuadrilla also spoke to MPs and gave an indication of the delays his firm faced:
“A process in terms of approval and determination that is supposed to take 16 weeks, in the case of Preston New Road, took 28 months. With Roseacre Wood, where we have another site in the process of a current appeal, we are now in the 46th month of that process, including the appeal. Those are proposals for fracturing. I understand they need very close consultation. Everybody wants to understand them properly, but it is a question of proportionality. As my colleagues have said, lesser applications not involving hydraulic fracturing are also taking an extraordinary length of time, given the statutory guidance.”
Lancashire County Council’s representative told MPs he “didn’t recognise” the 28 months figure. But Lambert wrote in backing it up.
Those sort of delays are quite unacceptable. Naturally, the planners will just shrug and say that they need more money. I am sceptical – the problem is the excessive, perverse, and often contradictory demands made. It is by no means clear that more planning officers would solve that problem, as there is no evidence of correlation between the number of planning of officers and their productivity.
If a Council’s planning department fails to meet its legal obligations, the central Government should send in a team who are able to meet the statutory deadline. If a school or an NHS Trust is failing, then it is taken over – the same should apply to a Council planning department. Of course, where a proposal is of national importance, the priority for this is all the greater. The Conservative Manifesto last year said that “when necessary, major shale planning decisions will be made the responsibility of the National Planning Regime.” The Government must now be vigorous in implementing that pledge. But more generally, it also needs to be much tougher with arrogant and inept planning officers who disregard their obligations – and are unapologetic about doing so.