Market view: The marine licensing maze

There is no specified time limit for the granting of renewable marine licences, so applicants should be aware of the intricacies of the system from the outset, says Lara Moore.

Obtaining the development consents required for marine renewable energy projects in the UK is often a complex and time-consuming process. One of the consents usually required is a marine licence. Under the Marine and Coastal Access Act 2009 (MCAA) (England, Wales and Northern Ireland) and the Marine Scotland Act 2010 (Scotland) a marine licence is required, up to mean high water spring tide, for a wide range of activities, including the construction, alteration or improvement of any works in or over the sea, or on or under the seabed.

In England and Wales, projects with a generating capacity of more than 100MW are classed as nationally significant infrastructure projects (NSIPs) and are consented through the development consent order (DCO) process. If the DCO application is successful, a deemed marine licence is granted as part of the resulting DCO. For projects below the NSIP threshold, a separate application for a marine licence is required. This article focuses on developments requiring a separate marine licence application and the variation, revocation or suspension of “deemed” marine licences granted under a DCO.

Key Regulators

There are four key regulators who take marine licensing decisions: the Marine Management Organisation (MMO), covering English inshore and offshore regions, Welsh and Northern Ireland offshore regions; Natural Resources Wales, covering the Welsh inshore region; the Department for Agriculture, Environment and Rural Affairs, covering the Northern Ireland inshore region; and Marine Scotland, covering Scottish inshore and offshore regions.

Although each regulator has slightly different regimes in place regarding marine licensing, the considerations for a developer at the project outset are similar.

The marine licensing application process consists of between five and seven stages.

1. Pre-application. The project should go through environmental impact assessment screening/scoping. In Scotland, certain projects are required to go through a formal pre-application procedure. This includes the construction, alteration or improvement of a marine renewable energy structure, where the total area in which it is to be located exceeds 10,000m2.

2. Submission.

3. Validation. Confirms that the application contains all the information required.

4. Consultation. A 28-42 day consultation period after publication of notices.

5. Recovery. Since 1 October 2015, the secretary of state has had a power of recovery in respect of any marine licence application received by the MMO, which a local planning authority, or inshore fisheries and conservation authority, considers:

• is a £1 million-plus project;
• broadly speaking would take place within six miles of the English coast; 
• is capable of having a significant effect and raises issues that are appropriate for examination in an inquiry.

The MMO must refer such applications to the secretary of state and also has a wider discretion to voluntarily refer some other applications. In both cases, the government will decide whether to recover the application to decide, or return it to the MMO.

6. Inquiry. An inquiry may be held in respect of a small number of applications, including those recovered by the secretary of state as described above, or in Scotland applications including novel technologies.

7. Decision. The relevant decision-maker will either grant the marine licence, grant subject to conditions or refuse the application.

Potential Pitfalls

There are a number of potential pitfalls associated with marine licensing, which should be considered at the outset of a project. These include:

• Lack of timescales. There are no statutory timescales governing the decision-making process for marine licence applications, only non-binding guidance with no sanctions for non-compliance. The only method of appeal is judicial review. Therefore applicants should engage with the relevant regulator as early as possible and can assist by providing good quality information at the outset.
• Focus on methods of construction. A key focus of marine licensing is construction methodology. This can catch applicants out, because when contractors are appointed, the construction methodology may need to be changed. This can result in the need to make a licence variation application or, in extreme cases, a new licence application. All likely construction methods should therefore be considered during the application process.
• Variation, revocation and suspension. A marine licence can be revoked, varied or suspended by notice from the relevant regulator at any time for a range of reasons, including navigational safety, change in circumstances relating to the environment, and the catch-all for any other reason that appears to the authority to be relevant. This can occur long after the judicial review period has passed. The potential impacts are obvious: delays, increased costs, or ultimately a project that cannot proceed. Therefore it is important to include appropriate provisions in construction and other contracts to deal with these risks. Similarly, it is worth considering placing Brexit-focused review provisions in such contracts to allow for future flexibility.

Routes of Challenge and Appeal

The route of challenge or appeal of marine licensing decisions depends on the decision being challenged, the relevant regulator, and whether you are the applicant or a third party. Third parties challenge by way of Judicial Review. Applicants encounter a complex array of routes of appeal with differing time limits applying, depending on whether it is an appeal against a decision to refuse to grant, or grant subject to conditions, or whether it is an appeal against a decision to vary, suspend or revoke a marine licence