Understanding the nuances between these can help developers avoid pitfalls, meet planning policy and deliver value.
Energy considerations are now an essential part of a real estate development’s viability. However, terminology such as “Energy Strategy” and “Energy Statement” are often used interchangeably during the development process, clouding their distinct and important roles.
Energy Strategy: Setting the direction
An Energy Strategy is a high level, conceptual roadmap developed during the early stages of a project by a sustainability or energy consultant. It is usually an in-house document which helps to set the direction of the project. It outlines how a proposed development can improve energy efficiency and incorporate low carbon technologies, considering everything from district heating to passive design measures.
An Energy Strategy aligns a developer’s commercial drivers to local and regional frameworks, such as Local Area Energy Plans (LAEPs) or Heat Network Priority Areas. By considering emerging policies early, developers can not only strengthen their planning applications but also adapt commercial structures and supply chains before a project’s design is finalised.
Energy Statement: Supporting planning
An Energy Statement is a technical document that translates the Energy Strategy into a formal submission for planning purposes. It typically includes energy modelling, emission calculations and a demonstration of how the development meets local authority planning policies.
Most planning authorities require an Energy Statement for major applications and increasingly for minor ones. These statements align with current planning policy, which guides the design and energy approach of a scheme. Policies are typically written to help meet regulations, but there are often multiple ways to comply.
What’s the difference?
An Energy Statement focuses on aligning with planning policy, while an Energy Strategy takes a broader, more flexible view by considering commercial structures, partnerships, risk and funding. Relying solely on an Energy Statement can result in costly, abortive design work, particularly when policies lag behind rapid changes in the energy sector.
An Energy Strategy empowers developers to explore alternative solutions that may diverge from standard policy while still meeting (or exceeding) regulatory objectives. This strategic flexibility helps avoid rigid, policy-driven approaches that may be ineffective, and instead promotes a low carbon, future proofed development. Crucially, it enables developers to align with regulatory criteria while delivering commercially viable outcomes that enhance profitability and long term value.
A changing environment
Regulatory change is shaping a new baseline for development. The Future Homes Standard mandates a shift towards low-carbon technologies like heat pumps and reinforces a fabric first approach to drive energy efficiency. There are also EPC changes and the UK Net Zero Carbon Building Standard to consider, as well as many others.
Practical considerations are rapidly evolving too. One often overlooked factor is the electricity grid connection. Developers need to engage with the Distribution Network Operator as early as possible, as in certain parts of the country, connections may not be feasible ahead of 2030 and experience significant constraints to delivery. Delays can result in significant cost increases or failure to adhere to energy strategies late in the design process. Failing to secure grid capacity early can also mean missing out on lower cost connections or facing expensive infrastructure upgrades.
Future proofing development
An Energy Strategy or Statement that doesn’t consider regulatory change risks becoming outdated or falling short of targets within months. Failing to secure grid capacity early can mean higher costs. Future proofing also involves anticipating how energy demand may evolve, from accommodating electric vehicle charging, to ensuring capacity for heat network connections. An adaptable development will avoid costly retrofits and remain compliant as regulations tighten.
Early, energy planning mitigates risk and avoids costs while ensuring developments are commercially viable and sustainable.
Further information
Contact Amelia Macdonald or Gabriella Frank
In plain English: The Strategic Spatial Energy Plan
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