Energy: our work in Wales

Access to energy is fundamental for modern societies. It underpins much of our daily lives, from the buildings we live in, to the products and services that support our economy, the transport we rely on and the leisure activities we enjoy.

There is a growing awareness that our existing energy sources are finite, and the emissions we are creating are changing our global climate.

The energy trilemma

The three key issues regarding energy, called the Energy Trilemma, are:

• Energy security, including security of supply and reliability of infrastructure
• Energy equity, relating to how accessible and affordable the energy supply is across a population
• Environmental sustainability, which looks at moving towards renewable and low carbon energy supply to address our climate change challenges

Energy and climate change

Climate change is acknowledged as the greatest environmental threat humanity has ever faced. The energy supply sector (energy extraction, conversion, storage, transmission and distribution) is currently the largest contributor to global greenhouse gas emissions, which cause climate change.

Energy lies at the heart of the climate change challenge. The Welsh energy supply sector contributed 30% of total Welsh greenhouse gas emissions in 2021.

Energy solutions

There is a two-part solution to this energy challenge:

• reducing emissions stemming from energy supply by increasing the share of low or zero-carbon energy in the supply mix
• moderating growth in demand for energy by radically increasing energy efficiency and energy productivity (the economic output generated from each unit of energy used)

Doing both these things should enable us to satisfy future demand for energy without overheating the planet, energy supplies will be cleaner, and people’s needs will be met more efficiently.

Energy transition

Our energy systems need to achieve faster transition towards higher energy productivity and lower greenhouse gas emissions to address the energy trilemma.

New technologies such as renewable generation, and storage technologies like batteries and hydrogen are emerging, as older forms of energy generation, such as coal-fired power stations, exit the system.

Energy and devolution

In Wales, energy is a reserved matter, which means that strategic decisions and regulatory responsibilities relating to energy issues, such as security, affordability and market fairness, are made at the UK Government level. However, the Wales Act 2017 represents a shift whereby the Act devolves responsibility to the Welsh Government for larger-scale energy generation and functions in relation to excepted energy buildings.

Welsh energy policy framework

In 2017 the Welsh Government set a target to meet 70% of Wales’s electricity demand from renewable electricity sources by 2030. In addition to the 2030 target, in 2023 the Minister for Climate Change announced an additional target of achieving 100% renewable electricity generation in Wales by 2035.

There are also targets for

• 1.5 GW of renewable electricity capacity in Wales to be locally owned by 2035
• All new renewable energy projects to have an element of local ownership

Work is underway to ensure a framework is in place to help deliver these targets.

Our work on energy

Natural Resources Wales has many duties in relation to energy matters.  NRW’s general purpose is to pursue the sustainable management of natural resources (SMNR) in relation to Wales, by applying the principles of SMNR in the exercise of our functions, and through maximising our contribution to the Wellbeing Goals enacted in the Wellbeing of Future Generation (Wales) Act 2015.

We have some specific roles in relation to energy matters, including land management, advisory and regulatory roles, detailed below. This provides an opportunity to create a new and innovative approach to delivering integrated natural resource management by making the most of our tools and roles to better achieve positive outcomes for people, the environment and the economy.

Decision maker/ regulator

As a decision maker and regulator, our main aim is to protect people and the environment, and to take proportionate enforcement action against those who breach the regulations for which we are responsible. From an energy perspective, we have a statutory duty to advise upon and regulate many of the environmental impacts that can result from energy generation, transmission and consumption. The details of our permitting roles vary according to the type of technology – ranging from gas-fired power stations to nuclear power stations, small-scale hydropower schemes and hydrogen electrolysis. In addition to determining environmental permits, we also ensure that, once granted, operators undertake relevant activities in accordance with requirements set out in permits through our compliance activities.

We are also responsible for the implementation and enforcement of the UK Emission Trading Scheme (UK ETS) regulation in Wales, including issuing permits to installation captured by regulation and checking that they comply with the system’s operational rules. 

Land manager/facilitator

We manage 7% of Wales’ land area, including woodlands, National Nature Reserves, water and flood defences. This includes the Welsh Government Woodland Estate (WGWE) which we manage on behalf of the Welsh Government. Here, one of our roles is to facilitate the deployment of renewable energy production such as wind farms, hydropower, solar and biomass. This role includes working closely with Welsh Government’s renewable energy development company Trydan Gwyrdd Cymru.

Statutory adviser

We are a statutory consultee in the Welsh planning system and respond to around 8000 planning application consultations annually.

Our role is to advise developers and planning authorities on the potential environmental impacts from development proposals which is informed by the protection afforded to environmental interests as set out in relevant legislation and Welsh Government policies.

Technical/policy adviser

We are an adviser to Welsh Government, and to industry, the wider public and the voluntary sector, on matters relating to the environment and natural resources. We also provide impartial advice and evidence to the Welsh Government and UK Government within a wider energy policy and planning framework.

Evidence gatherer

NRW also has a role in monitoring our environment, commissioning and undertaking research, developing our knowledge, and being a public records body. We will continue to provide positive planning frameworks so that the most appropriate energy sources are exploited in the most appropriate places, integrating economic, social and environmental benefits.

Our work on the State of Natural Resources Report (SoNaRR) is ground-breaking and exemplary. The five-yearly report sets out the state of Wales’ natural resources, including energy resources. It assesses the extent to which natural resources in Wales are being sustainably managed, and recommends a proactive approach to building resilience. It also links the resilience of Welsh natural resources to the well-being of the people of Wales by highlighting some of the risks to our well-being, and the opportunities to improve not only the state of our natural resources, but the benefits that we derive from them.

NRW’s guiding energy principles

This section outlines a set of guiding principles to inform NRW’s engagement with the energy sector. The principles are a simple guide on the work NRW does in relation to energy, why we do it and how.

• We are committed to tackling the nature and climate change emergencies, as recognised by the Welsh Government.
• The energy hierarchy is the cornerstone of our work, providing a clear pathway to develop rigorous energy management.
• Energy conservation and energy efficiency should become central to our energy system transformation in achieving a low-carbon economy.
• Energy and environmental imperatives should go hand in hand to result in the most sustainable outcomes, maximising benefits for nature.
• We will continue to ensure that our strategy, decisions, operations and advice to Government and others are evidence-led and underpinned by regulation.
• We encourage, and where possible, support communities to generate and use energy from local sustainable resources.
• We will continue to engage early with key stakeholders to provide a more efficient and effective service.
• We will continue to improve and help design appropriate regulatory processes that aid responsible energy development, whilst protecting and seeking to benefit the natural resources of Wales.

Examples of our energy work

This section  highlights some of our roles and our innovative approaches in addressing issues relating to the energy trilemma – to mitigate climate change and safeguard the security and affordability of our energy supplies.

Trydan Gwyrdd Cymru is a publicly-owned renewable energy developer established by the Welsh Government. Its mission is to accelerate the delivery of clean energy projects across Wales, with a focus on community benefit and local ownership. NRW supports Trydan Gwyrdd Cymru by identifying suitable sites on the Welsh Government Woodland Estate, providing environmental data, and streamlining regulatory processes. This collaboration ensures that renewable energy developments are sustainable, inclusive, and aligned with Wales’s Net Zero ambitions.

Marine energy is a growing sector in Wales, with significant potential for tidal stream, wave, and lagoon technologies. NRW plays a key role in supporting marine energy development through its regulatory, advisory, and evidence-gathering functions. We work closely with developers and the Welsh Government Marine Energy Programme to ensure that projects are environmentally responsible and technically sound. Recent initiatives include strategic environmental assessments and habitat protection measures for marine species such as harbour porpoises and seabirds.

Local Area Energy Planning (LAEP) is a collaborative approach to designing energy systems tailored to the needs of specific communities. NRW contributes to LAEP by providing data, environmental expertise, and policy advice to local authorities and regional energy planners. Our involvement helps ensure that energy plans are resilient, low-carbon, and aligned with natural resource management principles. We have supported LAEP projects in several Welsh regions, helping to shape a more sustainable and equitable energy future.