Stansted G2 Planning Application
In April 2008 BAA submitted its highly controversial Stansted Generation 2 (‘G2’) planning application, seeking approval for a second Stansted runway. This would have enabled Stansted to become an airport of a similar size to Heathrow.
The scale of the project meant that the G2 planning application was automatically subject to a Public Inquiry which would be chaired by an Inspector appointed by the Secretary of State for Communities and Local Government. Following the Inquiry the Inspector would make recommendations to the Secretary of State who would make the final decision.
From the outset the dice were heavily loaded in favour of approval because the relevant Government policy at that time was set down in the 2003 ‘Future of Air Transport’ White Paper, which included the following policy statements:
o “The first priority is to make best use of the existing runways, including the remaining capacity at Stansted and Luton.”
o “The first new runway should be at Stansted, to be delivered as soon as possible (around 2011 or 2012).”
o “We support development as soon as possible (we expect around 2011/2012) of a wide-spaced second runway at Stansted, with strict environmental controls, as the first new runway to be built in the South East;”
The G2 planning application had initially been expected in 2005 to enable BAA to complete the project by 2011/12, allowing sufficient time for the planning process and construction.
However, SSE had fought BAA at every turn and, when the Stansted G2 application was submitted, BAA had not even secured approval for Stansted G1 – i.e. “best use” of the existing runway. In fact, it would be another year before G1 was finally approved and no longer subject to legal challenge.
Shortly after the submission of the G2 application in April 2008, the Secretary of State appointed not one inspector, but five, who announced their intention to use parallel hearings to fast track the Public Inquiry process with a view to being able to complete the Public Inquiry within six months.
SSE fiercely resisted attempts by the Government and its Planning Inspectorate to rush through approval of the G1 project. A general election was due to be held no later than May 2010 and SSE was optimistic, based on discussions that had taken place over several years, that both the Conservatives and the Liberal Democrats would, if elected, withdraw Government support for a second runway at Stansted – provided that approval had not already been given by that time .
It was therefore vital to prevent the Public Inquiry process being rushed, so as to allow for the possibility of a new Government being elected and withdrawing support for a second Stansted runway.
There was another important contextual point. SSE had been campaigning for many years for the break-up of the BAA monopoly. SSE had taken this position because Stansted had always struggled to earn a commercial rate of return and past investment had been cross-subsidised by Heathrow, which was highly profitable despite price caps imposed by its economic regulator, the Civil Aviation Authority (CAA).
Although a recent CAA ruling had signalled an end to cross-subsidisation there was strong pressure upon the CAA from the Department for Transport and BAA to reverse this ruling. There was considerable doubt as to whether a second Stansted runway could be financed on a standalone basis. If Stansted and Heathrow were separately owned there would be no scope for cross-subsidy and therefore less likelihood of as second Stansted runway. Hence SSE’s campaign for a break-up of BAA.
By a coincidence of timing, a Competition Commission market investigation into BAA was reaching its final stages in 2008. The Commission published its ‘Emerging Thinking’ in April and its ‘Provisional Findings’ in August. These reports indicated that the Commission was almost certain to rule that BAA must sell Stansted, which was another key reason for SSE resisting a rushed Public Inquiry.
Ultimately SSE succeeded in preventing even a start being made to the Stansted G2 Public Inquiry prior to the May 2010 general election. The election brought a change of Government and, as SSE had expected, the new Government withdrew support for the Stansted G2 project. BAA then had no real choice but to abandon the project.
Key documents relating to the proposed G2 Public Inquiry are provided below, including SSE press releases which provide a chronicle of the main developments between April 2008 (when the planning application was submitted) and May 2010 (when it was withdrawn).