Forecasting Policy Change

Will the UK ever actually build anything?

UK infrastructure is a rather dreary and depressing topic. We simply are not building enough of it and when we try it seems endlessly doomed to time and cost overruns. Whether it be major projects such as HS2 or the litany of smaller housing/transport/utilities projects the story is one of a slow and ineffective system grinding our economy and energy transition to a miserably slow pace. Considering the importance of infrastructure and the policy barriers standing in its way, I thought it would be a good area to practice some forecasting skills. After all depressing headlines only take you so far, to reach the true depths of despair we need some proper analysis.

For this purpose I’ve opted for looking at the most truly idiomatic Nimby policy - banning onshore wind.

Onshore wind is a truly wonderful thing. A well developed green technology, one that is both effective and extremely cheap. Building more onshore wind reduces fossil fuel consumption, lowers energy bills and generates positive jobs and investment, a win-win-win policy matrix. Unfortunately since 2015 consecutive conservative governments have decided that the good people of England simply cannot handle big spinny things in their proximity. Despite a continued build out of onshore wind capacity in Scotland there has been almost no development in England with the government focus shifting to offshore wind instead. The view was that voters, especially Tory voters of the Southern English ‘blue wall’ and beyond, would not countenance big unsightly turbines going up in their green and pleasant land. Whilst polling shows that generally there are strong public majorities in favour of both renewables and onshore wind,¹ there is undoubtedly a small but highly vocal minority in opposition.

David Cameron saw a chance to tack to the right and mobilise this group and so the 2015 Tory manifesto carried the promise to ‘halt the spread of onshore wind farms’ with the rationale that:

Onshore wind now makes a meaningful contribution to our energy mix and has been part of the necessary increase in renewable capacity. Onshore windfarms often fail to win public support, however, and are unable by themselves to provide the firm capacity that a stable energy system requires. As a result, we will end any new public subsidy for them and change the law so that local people have the final say on windfarm applications.²

Once in government the promise to end subsidies was carried through with new onshore wind cut out of the Renewables Obligation. On a positive note this decision has since been reversed with onshore wind now included in the governments Contract for Difference (CfD) scheme. The subsidy phase out is the least pernicious policy change however, what was truly destructive was the changing of the law ‘so that local people have the final say’. This vague promise found specific form through a 2015 amendment to the National Policy Planning Framework which placed two new requirements on new onshore wind developments:

• That new developments could only be built on land specifically identified for onshore wind development within the local authority’s development plan

• Further that ‘following consultation, it can be demonstrated that the planning impacts identified by the affected local community have been fully addressed and the proposal has their backing’

While neither may seem especially pernicious at first both these criteria have been essentially poison pills for new onshore development. The first challenge is that most local authorities have neither the expertise, funds nor time to produce detailed development plans that explore potential onshore wind sites. In practice only 11% of local authorities have produced these plans, dramatically reducing the possible number of sites.³ Community backing here, rather than meaning anything reasonable or logical, instead means an effective veto for any local resident or group to end a project. It only takes a single individual to object to a proposed project for the local authority to be able to scrap it. These two criteria have amounted to a de facto ban, killing onshore development in England. The total capacity installed from 2015-2021 was only 2.6% of that installed from 2009-2014. Rather than a build out of onshore wind accelerating here it ran straight into a bureaucratic brick wall.

The question we want to answer

Onshore wind is thus a clear example of a broader malaise where unduly restrictive planning and regulatory requirements are stopping us from building the infrastructure we need. The ending of the de facto ban would be a strong step towards beginning to push back on this malaise and so forecasting this potential policy change gives an interesting insight into where we are in terms of this broader challenge.

The exact question I am going to look at is: Will the ban on new onshore wind developments in England be lifted by the end of 2023?

More exactly this question will resolve yes if any of these criteria are met:

• The repeal of the 2015 local authority plan and community backing requirements from the NPPF

• A substantial alteration to these requirements within the NPPF with the aim of encouraging greater onshore wind development in England

• Wholesale reform or replacement of the NPPF which had the effect of allowing a significant increase in planning permission for onshore wind in England

Getting into the forecast

The first thing we need is a base rate or a prior, some indication of how common we would expect our event of interest to be absent any specifics. Unfortunately a good base rate is hard to establish here. There is (to my knowledge) no real great data sets looking at the success or failure of specific policies. The area is simply hard to quantify, with how policies are classified relying a lot on subjective judgement. For instance what would the correct reference class be for a repeal of the onshore wind ban? It is not simply a generic new policy, it would involve going against previous specific manifesto commitments and overturning an almost eight year precedent. It is also not however a U-turn. A U-turn to me suggests a case where immediate negative press and public feedback induces a rapid change in policy. The closest analogy I could think of was the repeal of the Fixed Term Parliaments Act where an established policy was overturned by the same party during its period of power. I’m sure there are others, but a couple data points do not a robust reference class make.

We thus fall in the world of priors, resting on an initial figure which expresses a messy web of intuitions and beliefs. The figure I ultimately landed on when taking an outside view, and thinking of this issue simply as the chance for a significant reversal to an established policy, was one of 10%. I think this is probably too high if I was to take a true outside view, really disregarding any specifics, as policy change is usually the exception rather than the norm. But it works for our purposes as a starting point.

Now that we have a prior it is time to take an inside view, and explore the specific factors which will influence how likely we consider a repeal of the ban to be.

The first key factor is the strength of the policy and advocacy community backing the repeal side. This is a substantial group, and one that spans across the political spectrum. The renewables industry, climate advocacy groups and public civil society mobilisation are obviously significant players here, and would be important in pushing decision makers towards a repeal. Polling does consistently show that a broad majority of the public, including Tory voters, are in favour of new renewable developments. There is also significant political support for the cause. The issue is a natural battleground for Labour, the case for green investment is a fairly simple one to make, and Starmer has explicitly said that Labour would life the ban.⁴ There is also a significant faction within the Tory party that has been looking to overturn the ban. Boris flirted with ideas of repeal but failed to carry through. The Truss growth plan, for how much of an absolute debacle it was, deserves some credit for including a lifting of the ban on onshore wind within its agenda. Sadly that did not translate through into Rishi's government which has tacked back to safer Nimby shores. There remains a decent chunk of Tory MPs, disproportionately Truss and Boris affiliated, who have been pushing for the repeal. This combines with right wing advocacy groups such as Britain Remade which is strongly focused around these exact infrastructure issues and is lobbying against the ban.

Combining these various support bases and trying to condense them into some numeric form I came up with an update of 10% in the direction of a repeal being possible.

The flip side of this support is the failure of these groups to make a repeal happen despite seemingly excellent opportunities. The 2019 manifesto, in contrast to 2015/2017, made no mention of onshore wind at all, dodging the issue of the ban and likely giving Boris room for manoeuvre. In government it is clear that Boris wanted to move to repeal the ban but faced cabinet opposition and didn’t want to take on the political heat.⁵ During the leadership contest, despite Rishi and Truss both joining together to disparage solar panels as some grave threat to UK farmland, they split over onshore wind. Truss taking the repeal position and Rishi courting the anti-wind faction by promising to maintain the ban. Truss' government was too short lived to carry through on the promise of repeal and once we moved to Rishi the issue was again dropped.

Yet such is the way of Tory infighting that conflicts rarely remain buried for very long. The new drama became a showdown over the Levelling-up and Regeneration Bill moving through the commons. Two major rebellions developed against this sprawling. The first succeeded in killing the housebuilding targets within the bill. The second was led by Simon Clarke and sought to repeal the onshore wind ban, this rebellion was supported by Truss and Boris, eventually massing some 34 MPs behind it and did force the government into a more conciliatory mode.⁶ Grant Shapps announced the government would revisit the NPPF and allow onshore 'where communities are in favour of it'.⁷ The amendment was thus dropped and the government opened a consultation on changing the NPPF around onshore, yet these promises of change ended up being essentially false. They amounted to a minor change of wording to the community consent section, which in practice still leaves open the way for individuals to torpedo project proposals, the de facto ban will remain.⁸

There still remains a strong component of the Tory party implacably opposed to onshore wind. This includes Grant Shapps himself who sees turbines as an ‘eyesore’ and made the bizarrely untrue claim that:

They are so big, the turbines wouldn’t be able to be carried by roads. They have to be put offshore. These single turbines are seven football pitches in scope as they turn. They’re not buildable onshore.⁹

The reality seems to be that Rishi has tied himself closely to a set of ministers and backbenchers who have long resisted onshore wind and will continue to do so. The fig leaf of considering changes to the NPPF has amounted to nothing, and there seems to be little reason to think that there will be any more good opportunities going forward for a policy change. Rishi clearly has no desire to push the boat out and fight against his backbenchers here, and so the Nimbys remain triumphant for now.

Taking these repeated failures at repeal and the continued strength of opposition within the Tory party causes me to update against a 2023 repeal by 10%.

The final factor I am considering is whether or not we might see a change of government to one more likely to repeal the ban. The first way this could happen would be Rishi losing the Tory leadership and there being another new (or not so new) Tory PM brought in. Overall this seems a highly unlikely scenario. The party seems broadly exhausted from it’s repeated defenestrations and there is no serious internal challenger, Boris and Truss are both likely too damaged. It would require a major scandal or crisis to strike Rishi, which is possible but seems unlikely, though the nature of major scandals is that they are not easy to predict. Any new leader would also simply stumble into the same factional dilemmas that are guiding Rishi on onshore wind, making a repeal further unlikely. Rishi could also fall through a parliamentary vote of no confidence, however the strength of the Tory majority makes this extremely unlikely, with any divisions far more likely to manifest in an internal leadership contestation. The third possibility is that Rishi calls an early general election. In light of the myriad domestic crises, terrible polling, and relative brevity of his tenure this seems a highly unlikely choice for him to make. The political calculus seems to clearly point to delaying an election until Q3 or Q4 next year with the hope that inflation will fall and growth increase, giving time for polls to improve.

Considering this I give a 2% positive rating to the idea that we might see a change of government bringing a repeal, it is within the realm of possibility but highly unlikely.

The final forecast

Taking 10% as our starting point, adding 10% for support, taking away 10% for the failures at repeal, with a final 2% coming from a potential change in government, we land on a final forecast of a 12% chance that the ban will be repealed this year.

Where might I be most wrong here? The most likely ways I could have gone wrong is underrating the chances that Rishi falls from power as well as the chance that he decides to reorient his policy position, perhaps tacking to the centre and making more moderate overtures. My current view is that Rishi’s government has become mired in the same sclerotic factional politics that has undone all the previous ones, and that the odds of him actively leading the party, and pushing different factions to bargain and make concessions, are very low. I could be surprised here, but I suspect that this current government will trundle on, relatively stable but ineffective, until it has to face up to a general election next year.

Concluding thoughts

My main conclusion from doing this exercise has been that the status quo is very sticky, especially in the realm of government policy. Even where a policy change is so obviously beneficial and positive-sum it is relatively simple for a significant vocal minority to resist any change. Infrastructure is such a challenge because the benefits are large but diffuse. Wind farms, high speed rail, or new housing developments will make us all more productive and richer but the physical nature of infrastructure means that they necessarily entail costs. People’s lives are inconvenienced, houses demolished, trees chopped down and fields constructed on. These costs are very real, and should be compensated for, but they cannot halt us in our tracks. The reality is that the benefits so far outweigh these costs. We need some more of the basest form of democracy, the simple fact that the interests of the vast majority overrule the costs to the few.

I don’t know how we get from here to there. Nudging our current system towards more of this ‘good’ majoritarianism/populism/whatever this is seems a very difficult task. It can clearly go wrong. Truss was fundamentally correct that some deregulation would be highly beneficial to improving UK growth. Extending this beyond onshore wind to fracking or financial services was I think a serious mistake. Currently Labour seems to be the only real hope for realising this shift to an infrastructure focused agenda in a sustainable or just form. The path forward here in the short term seems to simply be escaping the world of internecine Tory factionalism.

I may do a follow up to this post exploring some forecasts relating to a potential general election next year, and how robust we might expect current labour polling leads to be. So any thoughts about that send them my way!

If you want to have a go at forecasting yourself, and winning some lovely fake money, then I have made a market for this question on the prediction market site Manifold that you can check out (please do I need more traders). And do subscribe if you found this interesting!

1. https://www.renewableuk.com/news/615931/Polling-in-every-constituency-in-Britain-shows-strong-support-for-wind-farms-to-drive-down-bills.htm

2. https://www.theresavilliers.co.uk/sites/www.theresavilliers.co.uk/files/conservativemanifesto2015.pdf

3. https://www.renewableuk.com/news/633507/Governments-planning-reforms-fail-to-bring-back-onshore-wind-in-England-.htm

4. https://www.theguardian.com/environment/2022/nov/10/labour-would-ditch-tory-ban-on-new-onshore-windfarms-says-starmer

5. https://www.bbc.co.uk/news/uk-politics-60952056

6. https://www.theguardian.com/environment/2022/nov/29/onshore-windfarm-restrictions-ministers-rebel

7. https://www.theguardian.com/environment/2022/nov/28/no-10-set-to-allow-new-onshore-wind-projects-in-england-in-u-turn

8. https://www.theguardian.com/environment/2023/feb/28/fears-grow-government-will-renege-on-lifting-onshore-windfarm-ban-in-england, https://www.renewableuk.com/news/633507/Governments-planning-reforms-fail-to-bring-back-onshore-wind-in-England-.htm

9. https://www.independent.co.uk/climate-change/news/onshore-wind-shapps-sunak-miliband-b2235949.html