Should we cover Wales with wind farms?

It is not exactly a secret that obtaining planning permission for building new homes is notoriously difficult in Britain. An unholy mix of vested interests, pastoral romanticism, and myths about overpopulation and overbuilding choke off the housing market’s responsiveness to people’s needs.

But there seems to be an exception to the anti-development bias engrained in the planning system. For political pet projects like wind farms, the red carpet is being rolled out, even if this means riding roughshod over the preferences of local populations. This week, protesters in mid and west Wales are voicing their anger about a grand investment scheme, which would cover parts of the countryside with wind turbines, but apparently to no avail. So, on balance, is the planning system ‘too tough’ or ‘too light’ then?

It is both, and these are two sides of the same coin: when development rights are held by political bodies, the planning process follows political priorities. And apparently, wind farms rank higher on the political priority list than affordable housing. If we want a planning system which reflects the preferences of local residents more closely, we need to denationalise development rights.

A few years ago, IEA author Mark Pennington developed a proposal for how the transition to a non-state alternative could work. In a nutshell, it is a kind of common property rights system, in which the right to develop a particular plot of land would be devolved to private entities owned collectively by local residents. At least initially – these rights could then be freely bought and sold, and it is completely open what kind of market structure would result.

Here’s what this means in practice: suppose there are two similar villages, A and B. The residents of both villages are opposed to new developments in their area, so a survey or a public consultation would yield the same result in both places. However, suppose that while the residents in village A have extremely strong objections to development, the residents of village B do not mind it very much – a small compensation would suffice to make them change their minds.

A private developer could then purchase developments rights quite cheaply for the surroundings of village B, while it would be prohibitively expensive to do so for village A. Development would thus be channelled to the places where people are least opposed.

More realistically, the residents of both villages would probably be willing to tolerate some forms of development in some parts of their surroundings. Acquiring the right to build on an area of outstanding natural beauty would surely be prohibitively expensive, while acquiring the right to build on waste ground could be rather cheap. Likewise, the right to build houses in an architectural style that blends in well with the rest of the village would surely be cheaper than the right to build something which clashes with it. And that leads us back to our Welsh wind farms.

Under a system like the one just described, the right to obtain planning permission for wind farms could be quite cheap in places where people do not mind hugely – possibly around Brighton, where nearly a third of the electorate votes Green. In a place like Wales, it could be considerably pricier.

Or maybe not. Protesting for a particular cause, or advocating it in a public consultation, does not cost anything. We have to give it a try – people’s preferences only become apparent when they are faced with real choices and their actual costs.

Dr Kristian Niemietz is the IEA's Editorial Director, and Head of Political Economy. Kristian studied Economics at the Humboldt Universität zu Berlin and the Universidad de Salamanca, graduating in 2007 as Diplom-Volkswirt (≈MSc in Economics). During his studies, he interned at the Central Bank of Bolivia (2004), the National Statistics Office of Paraguay (2005), and at the IEA (2006). He also studied Political Economy at King's College London, graduating in 2013 with a PhD. Kristian previously worked as a Research Fellow at the Berlin-based Institute for Free Enterprise (IUF), and taught Economics at King's College London. He is the author of the books "Socialism: The Failed Idea That Never Dies" (2019), "Universal Healthcare Without The NHS" (2016), "Redefining The Poverty Debate" (2012) and "A New Understanding of Poverty" (2011).