Read alongside the draft National Planning Policy Framework (NPPF), published by the Ministry of Housing, Communities and Local Government (MHCLG) in December 2025, the two documents are already pulling in opposite directions on energy and carbon policy. That tension is likely to shape how London builds for the foreseeable future.

When the floor becomes the ceiling: the Draft London Plan meets NPPF PM13

The question now is whether the Draft London Plan will still have room to do its job. Draft NPPF Policy PM13, Setting Standards, would prevent local plans from imposing quantitative standards on matters already covered by Building Regulations, except in limited areas such as accessibility and water efficiency. That could remove some of the Mayor’s most effective levers for driving higher performance standards, including energy use intensity, space heating demand, onsite renewable energy generation, embodied carbon and overheating requirements.

As the Association for Environment Conscious Building (AECB) and the Low Energy Transformation Initiative (LETI) have warned, Building Regulations would no longer act simply as the floor. Instead, they could become the ceiling as well, the lowest common denominator for building performance in the capital.

Softer language

Against that backdrop, the language of Chapter 5 of the Draft London Plan is telling. Whereas Policy SI 2 of the 2021 plan required major development to achieve “net zero carbon”, Chapter 5 of the draft plan speaks only of development helping to “work towards London’s net zero carbon ambition”. The key policies, GHR1 Energy Efficiency, GHR2 Low-cost, Low-carbon Heat, and GHR3 Whole-life Carbon, retain the direction of travel, but their binding, quantitative framing is noticeably diluted.

This is not accidental. The Towards a New London Plan consultation highlighted concerns that overly prescriptive standards could undermine viability and housing delivery. It also raised the possibility of aligning with the Future Homes Standard, the Future Buildings Standard, or the UK Net Zero Carbon Building Standard, rather than maintaining a separate set of London-specific requirements.

Where have the offset payments gone?

The clearest shift is in the status of the zero carbon offset payment. Under Policy SI 2, any shortfall was payable as a cash-in-lieu contribution to a borough carbon offset fund, a mechanism that has catalysed roughly £380 million since 2016, of which some £77.8 million remains unspent in council accounts. Chapter 5 no longer sets the on-site reduction target that made the payment a mandatory trigger. The £95/tCO₂ price still appears in the viability assessment, but only as a figure that “boroughs may use to collect offset payments”, a subtle but significant shift from a mandatory London-wide mechanism to a discretionary local one. Whether that reflects a genuine belief that offsetting had run its course, or a viability-based hat tip to the development community, remains to be seen.

The interaction that matters

If PM13 survives consultation broadly intact, the Mayor’s ability to reimpose more stringent quantitative targets at Examination in Public will be tested against the soundness requirement for consistency with national policy. London risks weakening both its strategic lever above Building Regulations and the mechanism that recycled non-compliance into local carbon savings. There is a risk that this version of the plan will be remembered more for what it stopped requiring than for what it set out to achieve.

Further information

Contact Chris Cummings or Dan Jestico

Savills provides initial thoughts on new draft London Plan