PLANNING BALANCING TESTS (NEED VS IMPACT)

1. Introduction

The planning balancing test of need versus impact is a central principle in UK energy-infrastructure decision-making. It requires planning authorities and, for nationally significant infrastructure projects (NSIPs), the Secretary of State to evaluate the public benefits and need for proposed infrastructure against its adverse environmental, social, economic, landscape and community impacts.

For major energy infrastructure in England and Wales, the principal framework is the Planning Act 2008 together with the relevant National Policy Statements (NPSs). The current EN-1 Overarching National Policy Statement for Energy, effective from 6 January 2026, establishes an urgent need for substantial new electricity infrastructure and provides the primary policy framework for balancing benefits and impacts.

2. Statutory Balancing Test

Under section 104 of the Planning Act 2008, where a relevant NPS has effect, the Secretary of State generally determines a Development Consent Order application in accordance with that NPS.

However, consent may be refused where specified statutory exceptions apply. Importantly, the Secretary of State need not decide in accordance with the NPS where satisfied that the adverse impacts of the proposed development would outweigh its benefits.

The balancing exercise therefore involves two broad sides:

Need and benefits may include energy security, additional generating capacity, network reinforcement, achievement of net-zero objectives, economic development, employment and wider long-term benefits.

Adverse impacts may include biodiversity loss, landscape and visual effects, noise, heritage damage, community disruption, land-use impacts and cumulative environmental effects.

3. Weight Given to Energy Need

EN-1 establishes a strong policy need for new energy infrastructure. It states that electricity demand is expected to increase significantly as transport, heating and industry become increasingly electrified.

Because of the urgency of infrastructure development, decision-making begins with a presumption in favour of granting consent to energy NSIPs, subject to relevant NPS policies and statutory requirements.

This does not mean that energy need automatically overrides environmental harm. Instead, the decision-maker must identify both benefits and adverse effects and determine their relative planning weight.

4. Mitigation Before Final Balancing

The balancing exercise is closely connected with the mitigation hierarchy. Applicants should first seek to avoid adverse impacts, then reduce or mitigate them and, where appropriate, provide compensation.

After these measures have been considered, remaining residual adverse effects are weighed against the project's benefits. EN-1 specifically requires consideration of environmental, social and economic consequences at national, regional and local levels.

For designated Critical National Priority infrastructure, policy gives particularly substantial weight to need, although applicable statutory environmental requirements remain relevant.

5. Case Law

Case Name/Citation

R (Finch on behalf of the Weald Action Group) v Surrey County Council [2024] UKSC 20

Facts

Planning permission was granted for commercial oil production at Horse Hill in Surrey. The environmental assessment considered emissions produced at the development site but did not assess the greenhouse-gas emissions resulting from the eventual combustion of the extracted oil.

Legal Issue

The issue was whether those downstream combustion emissions constituted indirect effects of the project that had to be assessed through the Environmental Impact Assessment process.

Judgment

By a majority, the Supreme Court allowed the appeal. It concluded that the combustion emissions were effects of the project that should have been included in the EIA.

Legal Principle/Ratio Decidendi

Where environmental legislation requires assessment of likely significant direct and indirect effects, legally relevant environmental consequences must be identified before the decision-maker performs the ultimate planning judgment.

Importantly, EIA does not automatically prohibit development causing significant environmental harm. Its function is to ensure that environmental consequences are properly assessed and taken into account before permission is granted.

Significance

Finch demonstrates that a lawful need-versus-impact balance depends upon adequate environmental information. A decision-maker cannot properly balance infrastructure benefits against environmental harm if legally significant effects have been omitted from the assessment.

6. Role of Alternatives

The existence of a potentially less harmful alternative does not automatically require refusal. EN-1 states that there is no general requirement to establish that a proposed project is the absolute best alternative. Relevant alternatives are considered proportionately, particularly where legislation or specific policy requires them.

7. Conclusion

The planning balancing test is therefore not a simple mathematical comparison. It is a structured legal judgment involving established infrastructure need, project benefits, environmental and community impacts, mitigation, residual harm and applicable statutory protections. Energy need may receive substantial policy weight, but the decision-maker must still obtain adequate environmental information and lawfully assess whether the project's benefits justify its remaining adverse consequences.