In this post, we take a look at plans to deregulate planning in a dozen “investment zones” that could result in the elimination of affordable homes as part of larger construction projects. From June through August, rising material, energy, and gasoline prices hampered business activity. Midlothian Energy Limited is to explore absorbing waste heat from industrial activity in order to provide low-carbon heat to Midlothian households and businesses through new district heating networks. The West of England’s investment plans could be reduced by £11 million if inflation remains high.

Affordable housing could be dropped from larger building projects

Original Source: Affordable housing provision in wider building projects could be ditched

Affordable housing as part of larger construction projects could be scrapped under plans to deregulate planning in a dozen “investment zones.”

According to sources, the contentious decision is being considered before Kwasi Kwarteng’s mini-budget on Friday, which will outline the government’s growth strategy and promised tax cuts.

In the first 12 investment zones, environmental and planning laws would be relaxed to “promote growth and accelerate development.”

The zones are modelled after freeports and are supposed to attract company investment by reducing red tape and taxation.

The prime minister, Liz Truss, proposed the proposal during her leadership campaign, claiming it would help “unleash investment and encourage economic growth across the country.”

Councils expressed interest in becoming investment zones this week, and Kwarteng plans to cite the uptake as confirmation of the policy’s popularity in his House of Commons speech later this week, officials said.

A letter from the levelling up department to local councils, seen by the Guardian, suggested that establishing an investment zone would provide “marked planning sites for growth and housing.”

It continued, “Where planning applications exist, they will be significantly streamlined.” Tax sites may be co-located with planning sites or distinct, depending on the local economy.

Local authorities given an investment zone designation may enable developers to avoid affordable housing standards, according to government sources. Each agreement will be unique.

Section 106 agreements, which force developers to build or pay for additional infrastructure in exchange for planning clearance, could be reduced in the initial batch of investment zones.

It is also thought that plans were set up to exempt investment zones from a green belt development prohibition. However, no action was taken.

Simon Clarke, the levelling up secretary, is reportedly mindful of the last Tory rebellion over planning reforms, which Boris Johnson’s administration had to abandon.

The levelling up department wouldn’t comment on the next budgetary event.

Start-ups stall

Original Source: Project starts grind to a halt

Rising material, energy, and gasoline costs slowed industry activity from June to August.

Glenigans Construction Review says that primary contract awards fell 12% from the previous three months.

Detailed planning permissions increased by 5% compared to the previous three months, but they were down from a year ago.

The September analysis shows a declining pipeline and project beginnings. Work starts plummeted by 41% from the previous three months and 48% from the year before.

Starting huge projects (£100m+) has declined. These fell 54% in the previous quarter and 74% year-over-year.

Starts on projects under £100m were down 35% from the previous quarter and 30% from 2021.

House-building had a dismal summer, with project starts plunging 38% from the previous three months and 28% year-over-year.

Along with material inflation and high energy prices, housebuilders faced the implementation of Building Regulations Part L. Lack of clarity on the new norm led to a softening of activity as developers rushed to comply, halting activity until regulatory criteria could be completed.

Office construction starts fell 51% from March-May to June-August and 48% from 2021.

Civil engineering starts declined 27% in the last three months and 25% year-over-year. In the three months to August, site-starts for utilities and infrastructure plummeted by a third. Both sectors had a quarter-year fall in value.

Northern Ireland saw the only year-over-year increase in starts, at 87%.

London had the poorest time for project-starts, with the value falling 55% from the previous three months and 62% from the previous year.

The East Midlands fell 46% in the three months to August and 37% year-over-year. Scotland plunged 39% in three months and 35% in a year.

Glenigan economics director Allan Wilen remarked, “This review demonstrates that the construction industry is still grappling with supply chain challenges and material inflation due to the Ukraine crisis.” A weak economic outlook, a cost of living crisis, and high energy expenses have exacerbated this. “We should expect modest progress as the UK marches into an all-time low in consumer confidence and a recession, but we’re confident in our spring/summer prognosis of an industrial recovery by 2023.”

Midlothian trash to low-carbon heating

Original Source: From waste to low-carbon heating for Midlothian homes

Residential and commercial low-carbon heat

Midlothian Council and Swedish state-owned energy provider Vattenfall AB have launched a 50/50 joint venture to deliver low-carbon heat to Midlothian households and businesses.

Shawfair LLP contract

Midlothian Energy Limited will explore capturing waste heat from industrial activities to supply customers via new district heating networks. The company has signed a contract with Shawfair LLP to facilitate heat network connections for homes and businesses in Shawfair.

2019 work

Construction of the initial district heating network in Shawfair Town, north of Midlothian Council, is planned to begin this year and be completed by 2024. This initial phase should save about 2,500 tonnes of CO2 per year, or about 1,200 automobiles. The Scottish Government’s Low Carbon Infrastructure Transformation Project will provide up to £7.3m (note 3). (LCITP).

Heat capture

Midlothian Energy Limited will capture heat from FCC Environment’s Millerhill recycling and energy recovery centre (RERC) to offer low-carbon heat to houses. The plant uses trash from local people and businesses. This heat supply will guarantee low-carbon heat for Shawfair and spark a regional network spanning into south Edinburgh and East Lothian. The Shawfair facility is part of Midlothian Energy Limited’s 5-year strategy to offer low-carbon heat to 30,000 homes.

It’s cheaper than low-carbon alternatives.

Midlothian Energy Limited’s waste heat will be cheaper than alternative low-carbon sources and unaffected by wholesale energy cost inflation, shielding customers from market volatility through long-term lower heat prices. Vattenfall’s modelling predicts Midlothian’s heat networks could lower emissions by 90% compared to individual gas boilers (note 4).

Problem

86% of Scottish households rely on fossil fuels to keep warm, illustrating the size of the low-carbon heat transition issue. Vattenfall plans to offer city-wide district heating to Midlothian, Edinburgh, and East Lothian by 2050. Future projects will expand district heating networks and incorporate additional sources of waste heat to create a network comparable to those Vattenfall has built in major European cities like Amsterdam over the previous 25 years.

Goal-oriented

Vattenfall Head of Joint Ventures and Midlothian Energy Limited Director Eoghan Maguire said:

“Meeting Scotland’s goal of net zero by 2045 requires cooperation like this.” Midlothian Energy will reduce the use of fossil fuels in heating, and Vattenfall’s proposed heat networks throughout Scotland might create 900 jobs.

“Vattenfall heats 1.9 million clients in Europe and the UK.” District heating can be introduced quickly, at scale, and affordably in urban and suburban regions. Without it, Britain couldn’t attain net zero.

Innovation

Environment Cabinet Member Dianne Alexander said:

“Midlothian Council is thrilled that this innovative low-carbon project is being delivered.” The council looks forward to working with its long-term energy partner, Vattenfall, through Midlothian Energy Limited, and investing in a business strategy to help meet our ambitious net zero carbon ambitions.

Midlothian Energy aims to reduce fuel poverty. This scheme will help insulate clients from market instability and secure reduced heat prices throughout the present cost-of-living crisis.

Future-oriented town

Shawfair LLP’s Ed Monaghan said:

“We want Shawfair to be self-sufficient, sustainable, and zero-carbon. This partnership helped us realise our vision. It makes Shawfair Town a leader in low-carbon energy for homes, businesses, schools, and community facilities. Through this contract, the expanding community can use renewable energy.

Building this district heating network with Vattenfall and Midlothian Council supports Shawfair’s low-carbon goals. We back this revolutionary heating system with a public transportation network. We intend to encourage healthy living and rural appreciation to attract environmentalists.

Zero-waste goals key

FCC Environment Group CEO Paul Taylor:

Millerhill RERC began turning non-recyclable garbage into heat and power in 2019. We established the plant with Edinburgh and Midlothian councils to divert 155,000 tons of garbage annually from landfills. The location is crucial to achieving the Scottish Government’s Zero Waste aim (note 6).

Utilising the heat from this plant is crucial as we progress to a lower carbon future economy. Therefore, today’s news that 170,000 houses in Midlothian and Edinburgh will have low-cost, low-carbon heating by 2050 is welcome and we are happy to be a part of this major step forward.

High inflation could take £11m off the West of England’s investment plans

Original Source: High inflation could wipe out £11 million from West of England investment plans

New analysis suggests 9.9% inflation might damage initiatives including restoring railways, updating bus services, and establishing new cycling lanes. Rising building costs and wages increase project costs.

Rising costs mean the West of England combined authority’s investment fund has £11.6 million less “headroom” (Weca). This money will be used to pay for regional infrastructure initiatives.

Recent committee documents detail how inflation affects Weca’s projects. Bristol, South Gloucestershire, Bath, and North East Somerset council leaders will meet with Dan Norris on September 23.

According to a Weca analysis, worsening economic conditions will undermine the region’s economy. Inflation, cost-of-living constraints, and a probable recession boost delivery costs and influence future priorities as the region’s difficulties alter.

Four programmes are under “severe pressure” from inflation: subsidised bus services, repairing the Henbury railway line and creating new stations, Bristol Temple Quarter reconstruction, and the $540-million sustainable transport settlement. Weca executives will give these programmes more attention to avoid overspending.

Weca officers will be urged to finish projects on schedule, as delays can increase expenses. Construction expenditures and public sector salaries affect the combined authority’s budget. Bosses originally planned a 2% salary raise, but have now increased it to 4%, costing an extra £248,000.

Average prices last month were 9.9% higher than in August 2015, according to the ONS. Inflation is expected to be 10% this fall. Metro mayors and council leaders will receive quarterly information on inflation and the recession.

Summary of today’s construction news

Overall, we have talked about the possibility that larger construction projects won’t include any affordable housing options.

Material, energy, and gasoline costs are rising, which has slowed the industry’s activity. But according to Glenigan economics director Allan Wilen, as the UK enters a recession and consumer confidence plummets, they expect progress and predict an industrial rebound by 2023.

Midlothian Energy Limited will capture heat from FCC Environment’s Millerhill recycling and energy recovery centre (RERC) to supply heat to homes with low-carbon waste. This £11.6 million of the West of England combined authority’s investment funds might be wiped out by high inflation. This money will be used to pay for regional infrastructure initiatives.

The West of England Combined Authority’s investment fund presumably has roughly £11.6 million less “headroom available” as a result of rising costs (Weca). Instead, this money will be used to cover the rising costs of significant public infrastructure projects in the area.