The Conservatives, Greens and Plaid Cymru held their party conferences this weekend, each setting out a very different vision for energy, housing and infrastructure.
From planning reform and fossil fuels, rent controls and public ownership of water, to community-owned energy in Wales, the announcements point in sharply contrasting directions.
The Conservatives are focused on speeding up planning and delivery, while moving away from renewables towards gas, drilling and nuclear. The Greens would shift the balance towards tighter control of rents and water, with a strong emphasis on retrofit. Plaid Cymru's focus on community ownership could change what developers are expected to offer local communities in Wales.
This should all be viewed within the context of a Conservative Party two years on from an election drubbing and now fighting to be the main party on the right, let alone in government, and a Green Party who’s polling is on the fall and look vulnerable to a resurgent Labour Party and internal division. Here is what was announced at each conference, and our take on what it could mean for developers, renewable energy projects and infrastructure.
Party leader Kemi Badenoch's opening speech on Sunday was about the party's direction. She said her aim to “renew” the party goes beyond individual policies. She also published a policy document, The Right Way, which she said will underpin policy development before the next election, including a pledge to replace the Climate Change Act.
Her key announcement, made at the end of her speech, was that the party would exempt some homes from Inheritance Tax. She also said that couples would be able to leave an additional tax-free sum of £1m to their families.
On planning, Shadow Chancellor Andrew Griffith said that the party would cut up to £50,000 off the price of a new home by removing net zero building rules, including the Future Homes Standard and other red tape. It would replace Section 106 and CIL with a single levy on developers, scrap the Environment Agency and Natural England and to tackle the ‘lawfare and judicial review’ culture holding development back. Stamp duty on primary homes would also be scrapped.
On infrastructure, Griffith promised to legislate to back a third runway at Heathrow. In her closing speech, Badenoch also backed Heathrow expansion.
Shadow energy secretary Andrew Bowie said the party would scrap GB Energy, end offshore wind auction rounds and abolish the Climate Change Committee. He repeated last year's bill cutting measures, removing a number of ‘green taxes’. He also said the party would look at legislating to force the Scottish government to allow a new nuclear power station in Scotland.
Badenoch's closing speech framed energy as a growth issue, saying Britain's energy is among the most expensive in the world. She pledged to drill in the North Sea to raise tax revenue and lower prices, describing the goal as “cheap, clean, abundant energy” from a mix of oil and gas, renewables and nuclear. She also promised new nuclear power plants, including small modular reactors.
The Inheritance Tax policy is eye-grabbing and will go down well within the party. It has been described as a ploy to woo wealthier middle-ground voters in the south of England, which the Conservatives need to win over from the Lib Dems and Labour. However, critics and analysts have argued that the measures would prove a disincentive to older people downsizing and selling their homes, creating another block to the housing market.
The package is aimed at lowering costs and delivery risk for developers, with the aim of deceasing sale prices and speeding up applications and build times. Critics argue that savings are unlikely to be passed onto buyers, though the measures may help to increase supply in a currently stagnant market. Furthermore, the cost to developers of having to meet certain environmental standards may be welcomed by the sector, less efficient and more expensive to run homes may impact how marketable they are.
The rhetoric around talking lawfare and judicial review may be welcome to developers, but many Conservatives run local authorities and indeed Conservative MPs and voters may feel that this will weaken their ability to resist schemes that they do not like, opening up a potential divide within the party.
Support for renewable developers is less certain, with the removal of key subsidies likely to impact the viability of schemes. The party did come out strongly in support of the nuclear sector over the conference.
The party has also come out strongly in favour of Heathrow expansion, seeking to capitalise on Andy Burnham’s apparent uncertainty on the issue and to paint the Conservatives as the party of growth.
Zack Polanski's leader's speech centred on the cost of living, with a plan to bring bills down by nationalising water, making every home energy efficient and putting an emergency brake on rents. The rent policy is a three-year brake on private rents, with no rises above CPI, wage growth or 2% - whichever is lower - followed by a national Fair Rents Guarantee.
Deputy leader Rachel Millward announced that a green government would bring Thames Water and South East Water into public ownership before Christmas, with no compensation for shareholders or creditors.
On energy, Polanski called for no more fossil fuel extraction, every home upgraded to the highest efficiency standard and a massive expansion of community energy. Millward also told new green councillors and mayors they are the party's “builders”, pointing to cycle routes, solar panels, green spaces and affordable homes.
For developers, the biggest impact would be on the rental market. A rent brake and a Fair Rents Guarantee would put pressure on build-to-rent and buy-to-let economics, so schemes underwritten on rental growth would need revisiting. The push to buy existing homes for social and affordable use favours acquisition over new build, while the focus on retrofit and efficiency points to tougher standards on new schemes and more work on existing stock.
For renewables, the direction is supportive, but the emphasis on community energy could favour smaller, locally owned projects over large developers.
For infrastructure, the water pledge is the clearest signal. If pursued, it would create uncertainty for investors and contractors tied to those companies' capital programmes.
Party leader and First Minister of Wales Rhun ap Iorwerth used his first party leader’s speech as First Minister of Wales to highlight the strong sense of community found in towns and villages across Wales, including through community-owned energy projects. This builds on a more substantive policy announcement made by Plaid Cymru in February, setting out ambitions for a minimum community ownership stake of between 15–25% in all energy projects over 10MW.
At the conference, a panel organised by Wales & West Utilities also focused on the potential for biomethane, or “Green Gas”, to contribute to Wales’ net-zero ambitions and strengthen energy security. The panel, which included Elwyn Vaughan MS, Chair of the Senedd’s Economy, Energy and Connectivity Committee, agreed that Wales is “uniquely placed to become a leader in biomethane production”. Vaughan said the challenge was now one of “turning potential into reality” through a supportive policy framework.
For renewable energy developers, the proposed 15–25% community ownership stake could be the most significant development. There is a realistic possibility this ambition could be reflected in policy in the short term, though the precise mechanism and timescale remain unclear. If adpoted, developers may need to consider a different approach to community benefits, with community ownership potentially becoming an expectation rather than simply a voluntary benefit offer.
It remains unclear whether community ownership would replace existing community benefit funds and other local levies, or operate alongside them. If introduced as an additional requirement, this could affect project viability and would require developers to engage with communities at an earlier stage around ownership as well as conventional benefits. However, greater stakes in projects may help to secure support for projects locally.
For energy infrastructure, the focus on biomethane provides a potentially positive signal for the development of Wales’ green gas sector. However, the comments from Elwyn Vaughan suggest that further policy and regulatory measures will be needed to turn the country's existing potential into viable projects.
To talk through what these announcements could mean for your projects, contact our team at enquiries@luminateconsultancy.com.