National Policy Statement for Ports

In another place, the Transport Select Committee is currently scrutinising the proposed national policy statement for ports and will publish its report by 14 November, the end of the relevant period that has been stipulated. The committee took written submissions up to 1 August and held oral hearings on 10 and 16 September. After the committee has reported, the Secretary of State will formally respond to its report, as prescribed by the Planning Act. The Government then aim to lay the national policy statement for ports in its final form for its statutory 21 sitting-day consideration period. I look forward to hearing all the contributions to today’s debate. I beg to move.

The UK’s first major shore-power cold ironing and electric ship charging project is under way at Heysham Port. Cold ironing is the process of supplying a docked ship with electricity from an onshore power grid, which allows the ship to shut down its auxiliary engines and reduce emissions, noise and vibrations. The work at Heysham is part of a broader plan to create green shipping corridors across the Irish Sea, supporting shore power for conventional ships and fast charging for future fully electric vehicles. This includes the eight-port network. Peel Ports Group and NatPower Marine are investing some £100 million to equip eight key UK and Ireland ports with charging infrastructure by 2030, with Heysham leading as the first net-zero port in the UK. These ports will support vessel charging and electric vehicle charging for landside operations. Then there are the south coast demonstrators. The Electric Seaway project has installed eight fast charging sites along the south coast, primarily supporting leisure and small commercial vessels under 24 metres. This is a robust regional network but is not yet designed for the largest container or deep sea ships. However, that must come.

The major problem that the Government, the Minister and his department need to address is limited grid capacity to our ports. As of now, only eight of the 32 major UK ports are expected to have sufficient electrical capacity by 2050 without significant upgrades, indicating that the fast charging rollout is still in its infancy and faces infrastructure challenges. The Minister’s comments on that major hurdle to growth would be greatly appreciated. However, let me try to help the Government with some suggestions.

Thought needs to be given to increasing the number of pilot and funding schemes, such as the Government’s clean maritime demonstration competition, to accelerate infrastructure upgrades. We need to assess port electricity capacity and plans for phased upgrades to handle high-power ship charging. We need to collaborate with technology providers and shipping lines to prioritise routes and vessel types for electrification. We need to monitor lessons from early projects at Heysham and the Electric Seaway for best practices and pitfalls.

The Minister himself has been a pioneer of similar work in the rail sector. Here, I argue, there is an opportunity at an early stage for the Government to position themselves as leaders by investing early in scalable future-proofed charging networks that can be expanded as more electric vessels enter service. This is really important because the global electric shipping market is projected to grow rapidly from about $4.85 billion in 2025 to $18 billion by 2032, with compound annual growth rates ranging from 10% to 20% depending on the vessel segment.

Environmental regulations also apply to shipping. Stricter emission laws are pushing ship operators to adopt cleaner technologies, including batteries, especially on short sea and regional routes where charging infrastructure is more viable. There are technology advances to be supported. Improvements in lithium-ion battery energy density, lifespan and safety, along with falling battery costs, make electrification increasingly feasible for larger vessels and longer routes.

The geographic leaders such as Norway and China are at the forefront. Norway leads in battery ferries. China is launching fully electric coastal container ships and has certified more than 30 battery makers for marine use. There is hybridisation: many new car and truck carriers and some container ships use hybrid battery-LNG systems for port manoeuvring and emission reduction, with pure battery power still limited by current battery energy density.

The UK Government have the opportunity to build on this important document and outline a clear road map with specific objectives and milestones for the deployment of charging facilities. This strategic plan should include short-term goals, such as the number of ports equipped with basic facilities, and long-term targets for full-scale electrification.

It has also been pointed out that there are no government forecasts for offshore energy or passengers in the way that there are for freight. Evidence from Associated British Ports suggests that more emphasis should be put on non-tonnage routes, and Portsmouth has highlighted the increasing development of passenger-related activities and their ever-changing needs. Harwich Haven talked to me about how bulk cargo patterns are changing due to global trade realignments—the less said about that, the better—and climate change requirements, which are leading to a need for more flexible storage and modernised handling structures.

It is particularly important that we get the basis of this document right now because, once the Planning and Infrastructure Bill takes effect, these documents will be reviewed every five years. It is important to have a solid baseline for that five-yearly review to take place. The Government have set out a number of objectives, including growth, efficiency and support for their own clean energy ambitions. They rightly frame the approach as market-led. Indeed, they see competition in the sector as key to driving up efficiencies and improving innovation. I think we could all agree with that, but a market-led approach leaves us with a particular challenge when it comes to the major infra- structure required to support the port sector. Road and rail improvements are provided long after the development has taken place. Political indecision, funding challenges and lengthy and complex planning processes mean that significant problems build up before any serious attention is given to dealing with them.

For example, the Orwell Bridge near Ipswich is the only HGV-suitable route out of the Port of Felixstowe. It is an ageing asset and requires regular maintenance; it was closed for a long period over the summer, when all the vehicles, including HGVs, were rerouted through the centre of Ipswich, which has narrow roads and subsequently suffered very serious congestion right through the summer. The A120 between the A12 and the ports is one lane in each direction for much of the route and is increasingly inadequate.

Given the Minister’s background, and given that the Government have a rail freight target of 75% growth by 2050, I was particularly interested to see that this document is entirely non-rail. Rail gets no specific mention, although there is a mention of HGV parking. As an example, the huge volume of freight movement between the Port of Felixstowe and the Midlands would benefit enormously from a series of measures to improve rail links between the hub of Nuneaton and Felixstowe. The branch line between Felixstowe and Ipswich is single track and is already operating at capacity. Improvements at Ely and Haughley junction are desperately needed. The noble Lord, Lord Moynihan, just referred to how grid connections are increasingly essential.

My final set of points relates to the highly complex and changing nature of the planning and consent regimes that face ports undertaking development of any kind. This is a recurring theme throughout the consultation responses and in the oral evidence given to the Select Committee. The Government’s intention is to save ports time and money on planning, and everyone would welcome that, but this threshold does not suit all the types of work that are needed to sustain, for example, offshore energy. My noble friend Lady Pidgeon will talk about that. Portsmouth International Port talked to me about how it wants to be sure that the NPSP offers support and context to all its throughput activities, development projects and improvements that it promotes.

I have observed the increasing physical distance between port activity and the physical port itself. Logistics or even security can be quite some distance from the port, which is important in the context of local planning. Stakeholders have suggested that deemed consent orders should include activities such as berth deepening, access roads, security and grid connections, and that this should be explicit in the NPSP. RenewableUK highlighted that, with multiple consenting routes for renewable energy projects, a clear overall framework is essential.

Many ports have developed master plans, which have been encouraged by the DfT since 2008. This document, interestingly, is silent on the role of port master plans and their status, which is a pity, because they can act as a very useful tool for working with local planning authorities. What exactly is the status of this document with regard to local plans? Will it be a material consideration for local authorities and the MMO, for example? Will the Government consider discussing with stakeholders the potential for port master plans to be explicitly recognised?

This is particularly important when it comes to protecting potentially valuable port-related land from other developments such as housing. It is a real issue in ports such as Portsmouth and London Gateway, which are located in urban areas. Witnesses are suggesting that the read-across to the current planning Bill is not clear, which is unfortunate; we should not be in that position.

I have three quick points to conclude. Statutory decision-makers are all subject to reductions in funding, people shortages and backlogs in decision-making. Speeding up the planning process will not happen unless we look at the resourcing of it. During the oral evidence session, witnesses spoke about the potential for a one-stop shop approach to help applicants through the maze of legal and regulatory permissions required. Finally, will the Minister assure the Grand Committee that his Government will look at the representations carefully to see whether improvements can be made to the clarity, hierarchy and status of this important document?

But this continued presumption in favour of port development and a market-led approach has very important implications for security, defence and national resilience. The UK, like so much of western Europe, faces increasing threats and grey zone activity. We all recall that in March this year the container vessel “Solong” collided with the tanker “Stena Immaculate”, which was at anchor off the Humber. The tanker was on charter to the US Military Sealift Command, carrying jet fuel for the US Air Force. The collision caused a fire and the release of aviation fuel, which then ignited. I am sure I was not alone in immediately thinking that this was no accident. However, my understanding subsequently is that it was a most unfortunate accident. The fact that the emergency services performed superbly should not blind us to the realisation of what might have happened.

I chair the Maritime Security Advisory Group, a small group whose aim is to increase awareness of the vulnerability of the UK in key areas such as international cables; undersea oil and gas pipelines and infrastructure; electricity interconnectors; offshore wind turbines and their shore connections; and, of course, ports themselves. Just imagine for a moment if the “Stena Immaculate” had, as a result of the collision, shifted position and moved in the direction of one of the communities or numerous installations that line the Humber. Or imagine if the vessel had sunk in one of the channels. There could have been major economic disruption, and even loss of life.

Of course, as an island the UK has a very long coastline. The scope for a hostile state or actor to inflict profound regional or national damage is enormous. The UK is very vulnerable given the very extended coastline, the subsea infrastructure and the ports. The more our ports expand and compete under the new strategy, with growing capacity giving wider options, the better.

The NPSfP is to be warmly welcomed not only for boosting growth but, importantly, for directionally boosting national resilience, but the policy could do more. Ports are not merely gateways for international freight. The policy could seek more actively to support port developments that address wider non-volume, non-traditional cargo activities. For example, there is enormous potential provided by renewable energy, the cruise trade—3 million passengers per year are passing through—and logistics development. Offshore wind remains a huge opportunity for the UK and will require significant expansion of port infrastructure, much of it highly specialised.

Meeting the requirements of the offshore wind industry should be accorded a higher priority by Government. A legitimate concern is that this opportunity has not been grasped more strongly earlier. Ports are designated as a foundational industry in the Government’s industrial strategy; it is of the upmost importance that they support growth and competitiveness, ensuring that the UK remains an attractive destination for global shipping businesses.

I know the industry feels that a higher important should be accorded to port investment. There are a number of actions that could help in the area of planning. First, the policy could be made more effective if planning policymakers were required to take account of it as a material consideration when drafting development plans, marine plans or other plan-making documents. Secondly, it should identify port operators and statutory harbour authorities as formal statutory consultees in the plan-making process. Thirdly, it could better protect the role of ports and their paths to future development through including or strengthening in the policy the status of the NPSfP against other national policy statements, giving ports mandatory consultee status in relevant development proposal assessments and ensuring that ports are better recognised within strategic spatial planning. Finally, the NPSfP— this acronym is worse than the one for the Caribbean trade agreement—should place greater emphasis on the importance of port connectivity, as road and rail development projects that are particularly significant for the movement of goods to and from ports can clearly reference the NPSfP in their proposals.

I also draw attention to the lack of measures to support alternative fuels, along with necessary shore power for vessels as well as the essential grid upgrades that the noble Lord, Lord Moynihan, mentioned. In a week when the IMO will be debating and voting on its net-zero proposals for shipping, I ask the Minister if there should not be a stronger alignment proposed with international frameworks such as the IMO net-zero framework and the FuelEU maritime regulation.

My final point is that the industry feels that greater recognition should be given to the scope for UK ports to act as trans-shipment hubs for Europe and more distant locations. In conclusion, the call made by the noble Baroness, Lady Scott of Needham Market, for a more fundamental review has much merit.

That is a problem—a £0.25 million problem—for the UK economy, but this competitive disadvantage is not referred to in the policy at all. It should be, because it is damaging our ability to trade with and earn our place in the world, especially as we are now able to operate our own independent trade policy with, for many commodities, a tariff advantage of 6.5% over the EU default on some goods. It is in everyone’s interest that we leverage this comparative advantage, but we cannot do so because we are under-ported and the policy does not mention it anyway. At this rate, we will never get to the expected 62.5% increase in dry bulks. I am doing my best to arrest the decline in liquid bulk traffics—a number that does not intuitively sound right to me given the huge volumes of LNG coming through Milford Haven, but I shall put that point to one side.

The case for new ports and port infrastructure is made. We cannot carry on without a dramatic increase in capacity and other break-bulk opportunities. We have a fleeting moment of comparative advantage to seize, so we must do it. However, we are here today because the 2012 policy has not worked. I am grateful for the short briefing from the British Ports Association, which told me that, since the existing policy was published in 2012, only four consequential consents have been issued. I take that at face value. The policy highlights a number of pre-2012 extant consents that have not been built. The UK’s ports infrastructure is sort of beached, so we have to ask why. With all the obvious demand, have we made it just too difficult to expand existing ports or build new ones? Will the draft policy make it easier or harder to expand the ports that our country needs?

Moving on, I am very surprised—here, I support the points made by the noble Baroness, Lady Scott—that the policy makes no reference to the astonishing ecosystem multiplier that supports the ports in terms of, for the most part, privately operated businesses, stevedores, cargo surveyors, ships’ agents, hauliers, warehouses, freight forwarders and customs agents, to name but a few. It is a massive sector, but the port policy is silent on this. I cannot understand that.

Also, in my view, the policy fails in its analysis to make the distinction between the ports; the harbour authorities, which maintain the navigations and provide pilotage, dredging and so on; and the terminal operators, which occupy land and quaysides within a port from which they ply their private trade. The preamble is completely incomplete in this regard, and the order of battle is misunderstood. I support the noble Baroness, Lady Scott, in calling for a more fundamental redesign and recasting of this policy in order to reflect the richness and texture of the industry, rather than just copying and pasting a policy that has not, sadly, yielded fruit since 2012.

I consider myself a terminal operator. My experience tells me why the UK does not have the dynamic ports and logistics infrastructure that we might have. Back in 2019, I wanted to build a terminal in the north-east to handle liquid fertilisers. There was a significant upfront capital cost for tanks and a new local market to build from scratch. It was a risky operation. I could not go to the big five ports—this is a problem—because they will lease you land for only 15 or 20 years. Investing millions up front, only to hand the asset back to the landlord after 180 months so that he can punt the opportunity on to someone else using infrastructure that you built and paid for—as well as the market that you built—was not a good business strategy. The fact is that the terms offered by most UK ports do not make it easy for private operators to make long-term, generational investment decisions to build businesses and trades. There is not enough choice or competition.

We went to the Port of Sunderland, a council-owned port where we were able to enter into a much more long-term partnership that made it easy for my business to develop a patient plan to build a market and be rewarded for it. You might say that this is a case of the market-based approach working, and you would be right. However, for every Port of Sunderland—I cannot praise it highly enough for its can-do attitude and customer focus—there are dozens of less accommodating take-it-or-leave-it ports, unconcerned about competition because there is such a structural shortage of supply. That is a problem that this policy should grip; we have a market failure in that terminal operators are unable to secure premises on a long leasehold or freehold basis in the UK to grow our trade.

Just as an aside—I am looking at the clock— I welcome the points about freeports, but I express surprise that the opportunity for customs warehouses has not been appropriately recognised. A customs warehouse is like a freeport but just for a single warehouse or individual terminal located within a port estate. I have one of these, and I want to give credit to HMRC and thank it for putting its shoulder to the wheel to drive my trade forward. It is invidious to name names, but the trade taxes team in Manchester know who I am talking about. There is a part of the state that understands the need for trade and works collaboratively and positively. That opportunity for customs warehouses should be publicised more. I am astonished that it is not at all in the policy.

I support the broad thrust of the first 16 pages of the policy. I would suggest the re-emphasis of some points, but I think we can all agree that ports are important, that we are under-ported and that we need more competition. We are missing out on global trade, and we need to have a wider variety of types of tenures in a market-led approach. This is the lens through which I approach the 66 pages that follow that essential preamble. Oh dear. Very briefly, we have nine pages talking about how an applicant might confidently demonstrate the commercial, wealth-creation, tax-generating economic and socioeconomic benefits of a proposal, then we have 57 pages on the need for various appraisals, surveys and analysis, attempting to prove the unproveable. It is all very worthy and well meaning, but wholly counterproductive and at odds with the overarching imperative to get the trade flowing and the economy moving.

I read it again, and I suppose that I should have taken comfort from paragraph 2.4.2, where it says that

“the Secretary of State should start with a presumption in favour of granting consent to applications”,

which is good,

“unless other policies in this NPS provide a clear reason for refusal”,

which is bad. After the nine positive pages, the trouble is that on every one of those 57 pages that follow is a clear reason to refuse an application for reasons that can be confected. The cumulative effects of any of them are enough to topple any proposal into the drink.

We have been sitting through the Planning and Infrastructure Bill, and a lot of the well-meaning but counterproductive proposals in Part 3 will slow down development, not speed it up. I would like noble Lords to listen to my following remarks through the lens of the Chancellor—I cannot believe that I am saying this —quoted today in the Times on the day the Government have apparently consigned much of the nature-based bureaucracy to the deep. She says:

“The outdated planning system has been gummed up by burdensome bureaucracy and held to ransom by blockers for too long. Our pro-growth planning bill shows we are serious about cutting red tape to get Britain building again”.

At last! I take her comments at face value, but we need to do the same with this policy.

I read the Hutchison Ports response to the consultation. Not only are so many of the outside-the-port requirements unproveable but required, even once a consent might be granted the costs of the conditions still are not known. Even if you have spent all your money on the surveys, traffic analysis and hydraulic predictions and got your consent, you still have no idea what it might cost. It is only at that point the bills start coming in.

You have to question the value of some of these surveys. In Gorleston-on-Sea, from where I take my territorial designation, they built an outer harbour in the early 2000s. I remember that there were dire predictions from the world’s leading hydrological practice that Gorleston beach would be scoured away, and that warning held up the proposal for many years. The harbour has been built, and the beach is as wide as it has ever been—it is the beach at Hopton just down the coast that has copped it. The crime is that so many people believed the expensive report in the first place. Here lies the problem—an expensive report based on arbitrary precision and dodgy modelling misdirected the whole investment process. Is it any wonder that we have not had a significant new port development delivered in the last 15 years? Will this policy make it any easier?

The whole tone of the policy presupposes that ports are, by their very nature, bad things for the environment. That is a false premise. Keeping shipping channels open with dredging speeds the flow of water out to sea and removes sedimentary contaminants. The wildlife habituates. That is not an argument for no regulation, but we need to return to a sense of proportion and the £1.2 billion spent on environmental reports for the lower Thames crossing proves we have gone too far. We just cannot afford it.

Biodiversity net gain sounds so nice, and it is good on land, but it is totally unproven and unprovable in the tidal marine context. While we try and work it all out, the key deals for wind turbine installation and oil rig decommissioning are all being sorted out over the water by 2028. We are at risk of missing the boat— absolutely. Then I read that there are restrictions on port development in flood zones. Guess what? Show me a port that is not in a flood zone. That is not well meaning; that is wholly counterproductive.

The NSIP process, although welcome, is not going to help that much because it is not going to whittle down those 57 pages into a more sensible number. It is less wading through mud, more like stuck in the mud. It is like the whole policy was written by the Dutch—that other great seafaring nation; a competitor nation that is not known for its ambivalence towards the environment or environmental protections, and much of which is beneath sea level.

We have a document that pays lip service to economic development but strangles it in red tape. It is a statutory charter for the objectors and blockers. As the Chancellor said this morning, we need to show investors that we are a country that gets spades in the ground and our economy moving. What to do? We need to think hard about this policy and how serious we are about growing the economy, driving global trade and earning our place in the world. The policy proposal places so many risk factors and hurdles that only those with the deepest pockets can contemplate expanding their port. That wipes out the trust ports and the smaller private ports.

Consultees broadly welcome the draft presumption in favour of port development, and so do I, but it must be bolstered with a sequential test that starts with the overwhelming weight of port development that our island nation requires—a clear presumption in favour of trust ports obviously, with weight given to safety and security. While you need to sacrifice some small areas to grow the economy insofar as the environment is concerned, there should be an overriding recognition that sea freight is the most environmentally benign form of transport and the leveraging of existing infrastructure, such as a more intensive use of existing channels. This is clearly a mitigation to which nature has habituated.