Renewables Obligation Closure Order (Northern Ireland) 2015

Executive Committee Business – in the Northern Ireland Assembly at 12:15 pm on 28th September 2015.

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Photo of Jonathan Bell Jonathan Bell DUP 12:15 pm, 28th September 2015

I beg to move

That the draft Renewables Obligation Closure Order (Northern Ireland) 2015 be approved.

This statutory rule is being made under powers in the Energy (Northern Ireland) Order 2003, which prescribes that the order must be laid in draft form for approval by affirmative resolution of the Assembly.

Renewable electricity generation in Northern Ireland is incentivised through the Northern Ireland renewables obligation, or NIRO, as it has come to be known. Since its introduction in 2005, the NIRO has been instrumental in increasing renewable deployment in Northern Ireland from 3% renewable electricity consumption in 2005 to just over 20% now. That achieves the Executive's ambitious Programme for Government target of having a fifth of our electricity generated from renewables by 2015. I commend the efforts of the renewables industry and infrastructure providers in helping to achieve that target.

As part of UK-wide electricity market reform, the NIRO, along with the other two renewables obligations in Great Britain, is scheduled to close to new generation in March 2017. A consultation on NIRO closure in 2017 was undertaken in 2012. The majority of respondents at that time agreed that it would not be viable to keep the NIRO open after 2017 if the other two renewables obligations in Great Britain were to close. In March 2015, DETI issued a consultation on NIRO transition and closure grace periods. However, prior to the publication of a DETI response in June 2015, the new Secretary of State for Energy, Amber Rudd MP, announced the closure of the renewables obligations in Great Britain to onshore wind from 1 April 2016. Since that time, discussions have been ongoing with the Department of Energy and Climate Change (DECC) regarding Northern Ireland's policy position on onshore wind. Due to those protracted negotiations with the Department of Energy and Climate Change and in the interests of providing legislative clarity to all non-wind technologies, I took the decision to take forward the legislation in two stages: first, non-wind, to be followed by onshore wind as soon as possible. A Government response specifically on non-wind closure grace periods was issued in August 2015.

Having covered what is not in the order, I will now turn to what it does cover. The proposed Renewables Obligation Closure Order (Northern Ireland) 2015 will close the NIRO to all non-wind technologies on 31 March 2017. The order will also introduce 12-month closure grace periods for non-wind projects that meet specified criteria. Those criteria will be that a project that was scheduled to connect by 31 March 2017 will have an extra year to connect if it suffered grid or radar delays through no fault of its own. There are particular arrangements for advanced conversion technology projects, which are, I understand, basically a form of energy from waste, to reflect their lengthy development timescales in Great Britain. Those arrangements reflect the position in the rest of the United Kingdom, and the costs will be socialised across all United Kingdom consumers. Policy on that issue has not changed since our consultation proposals of March 2015. Some developers sought longer grace periods, but, as set out in my Department's response, which was published in August 2015, that was not feasible in the context of overall United Kingdom policy.

In conclusion, the proposed rule will close the Northern Ireland renewables obligation to new non-wind generation on 31 March 2017 and will also introduce defined closure grace periods.

Photo of Patsy McGlone Patsy McGlone Social Democratic and Labour Party 12:30 pm, 28th September 2015

Go raibh maith agat, a Cheann Comhairle. Mo bhuíochas leis an Aire as an ráiteas. I thank the Minister for introducing the legislation.

The Renewables Obligation Closure Order (Northern Ireland) 2015 being debated today is a markedly different piece of legislation to that initially proposed and first considered by the Committee back in June. The original closure order covered both wind and non-wind renewable energy. The order being debated today makes provision for the closure of the NIRO to non-wind sources only, as the Minister outlined.

Back in June, the Department informed the Committee that a change in policy at the Westminster Department of Energy and Climate Change has meant that the Northern Ireland renewables obligation will close in 2016, one year earlier than originally planned. This was considered by many to be a very unreasonable change in policy, as wind energy developers have already invested considerable amounts of money in ongoing projects, which the change in DECC policy could put in jeopardy. The Secretary of State for Energy and Climate Change has stated that, should DETI decide to extend the grace period and provide support to wind developers for an additional year, she would expect any additional costs to be funded exclusively by Northern Ireland consumers. That, in turn, presented the Department here with a difficult dilemma: to support wind generation with an extended grace period at a cost to consumers or to follow the DECC policy and create difficulties for wind developers.

In the original proposal brought to the Committee on 30 June, the Department planned to support onshore wind generation for an additional year over and above that proposed in the DECC policy so as to allow developers to complete projects that had already been planned. This could add up to £16 a year to an average domestic consumer electricity bill, with the top electricity-consuming companies in the North paying around an additional £30,000 per annum for their electricity. The Committee considered this policy proposal and concluded that, considering the additional costs that consumers would be expected to pay, there was not sufficient or detailed enough information on which to base a decision. No information was provided to the Committee on any long-term benefits to consumers of adopting the proposals for onshore wind. It was unclear if the Committee was being asked to support a policy that would result in consumers being asked to pay more for their electricity with no net long-term benefits merely to subsidise wind developers who might otherwise find themselves in difficulties.

The Department placed considerable emphasis on the urgency with which the Committee’s agreement to the legislation was required because one particular project being brought by Full Circle Power/Bombardier required certainty on the closure order to secure the required funding in time to commence its £100 million non-wind project to ensure the project's completion by the closure date.

No substantive concerns were raised by the Committee regarding the non-wind aspect of the closure order. However, the Committee was not content to agree to legislation that added considerably to costs for consumers in the absence of any consideration by the Department of the potential benefits that the legislation would bring, especially when the sole reason for urgency was to provide certainty to a project that was entirely unrelated to the issues with which the Committee had major concerns. The Committee did everything in its power to assist the Department in providing the certainty that Full Circle/Bombardier needed but could not proceed with the legislation in the proposed format when there was so much uncertainty and so little clarity about other aspects of the order.

Whilst the Committee has every sympathy with wind developers, many of whom have invested considerable sums of money into ongoing projects, the Committee believes that the needs of developers must be appropriately balanced with the cost to consumers of adopting the proposed policy. A Committee decision must be based on full and accurate information.

For this reason, the Committee explored with the Department the option of decoupling the wind and non-wind aspects of the legislation. This would have provided the certainty that Full Circle/Bombardier required and would have given the Committee sufficient time to adequately scrutinise the more contentious aspects of the legislation. Members asked officials whether it would help solve the immediate problem if the legislation was decoupled to allow the non-wind aspects of the legislation to pass and thus enable those projects that were time-critical to move on.

During a meeting with the Minister on the matter on 2 July, I repeated the Committee's suggestion that decoupling the two aspects of the legislation should enable the non-wind aspects of the closure order to pass through the Committee without undue delay. However, the Department seemed determined, for whatever reason, to retain the legislation as it was. During the meeting with the Minister, I was informed that a number of onshore wind projects were in the pipeline that required similar assurances and that solving one problem could result in the creation of another.

The Minister also informed me that the timelines for the Full Circle/Bombardier project were very strict for triggering funding. He stated that the cut-off date for a decision by funders to prevent the project falling was Thursday 9 July and that the Committee’s agreement of the SL1 would provide the necessary assurances that investors needed for the project to proceed. It was on this basis and with assurances from the Minister that full clarity would be provided on costs and benefits that I decided to seek the Committee's agreement to convene an additional meeting on 9 July.

At the meeting on 9 July, the Department reiterated its assertion that the two aspects of the legislation could not be decoupled. Officials informed the Committee that the Department had given very extensive consideration to the issue since the previous Committee meeting and had taken legal advice on the matter. The Department put forward three reasons as to why the legislation could not be decoupled. First, the Department said that decoupling would give rise to uncertainty for other projects and that the time required would be well beyond the critical period for the Full Circle/Bombardier project. Secondly, decoupling would give rise to uncertainty for other projects, causing some to fall with a loss of future investment, a loss of future generating capacity and a loss of substantial economic benefit. Thirdly, according to the Department, differentiating between different types of projects, as proposed by decoupling, may be challenged on the grounds that it could constitute unlawful state aid.

Officials went on to update the Committee confidently on a developing situation that they believed rendered the whole issue of decoupling academic, as there had been a fundamental change in DECC's position, which had been confirmed in writing only that morning. Although the renewables obligation would still close to onshore wind in 2016, projects that were already in the system would be allowed to connect until March 2018, effectively providing a two-year grace period for projects already in the system, which the majority of onshore wind projects in the pipeline would be able to meet.

Officials told the Committee "with confidence and with certainty" that the cost to consumers would be significantly reduced from the figures provided the previous week. The Committee was told that the average increase in domestic bills could be as little as £3 a year and that the increase for high energy users could be almost 70% less than originally estimated. The Committee was put under considerable pressure to accept the SL1 and approve it without having been given access to the correspondence concerned, which, according to the Department, represented a fundamental change in DECC policy and provided a high level of clarity and certainty.

Given this seemingly exceptionally positive development, the Committee asked to see the correspondence concerned so that members could assure themselves that this high level of clarity and certainty had indeed been provided. After some time, the correspondence was brought to the Committee meeting for consideration. There was nothing in that correspondence from DECC to DETI that could in any conceivable way add even a crumb of clarity or certainty, or provide any assurances to the Committee that electricity consumers would not be charged for the additional onshore wind put onto the system as a result of an extended grace period. There was nothing in the papers or in the briefing from officials that could in any way provide a sensible, sound basis for the Committee to make a decision on such an important matter. I emphasise: nothing.

When questioned further, officials went on to state that those assurances had been received from DECC informally during conversations and may not be as clear to anyone who had not been party to them. However, bearing in mind the importance of the matter at hand, the Committee could not make a decision affecting the pockets of so many over such a long period merely on the basis of hearsay. That is not a way to bring forward legislation.

There was nothing in writing that provided the clarity and certainty that the Committee required.

At that stage, officials agreed that the Minister would write to the Secretary of State for Energy and Climate Change to outline his understanding of what had been agreed and to seek the appropriate assurances from the Secretary of State that his understanding of DECC’s position was accurate. The Committee agreed to convene a meeting as a matter of urgency as soon as the Department was in a position to provide full clarity on the specific issues of concern. I held the Committee in a position that we would convene with the urgency required as and when we got that clarity from the Department. That was on 9 July this year, just for clarity.

Given the urgency with which we were told that this had to progress, the Committee agreed to meet again as soon as the Department got back to it. Yet, here we are, almost 12 weeks later, considering the statutory rule (SR) for the closure of the renewables obligation to non-wind technologies only. The two aspects of the legislation have been decoupled, as the Committee suggested to the Department on 30 June. As for the clarity and certainty promised on the aspects of the closure order relating to wind projects, the Committee is still waiting.

The Department brought the current proposals to the Committee on 8 September. The SR is for closure of the NI renewables obligation to all non-wind technologies, including anaerobic digestion, hydro, solar PV, biomass and advanced conversion technologies, otherwise known as ACT. ACT includes the proposed project at Full Circle/Bombardier.

The Committee, having given the proposed policy due consideration, had no concerns about the proposals, but major concerns remain about the Department’s handling of the matter and the manner in which it engaged with the Committee. When officials briefed the Committee on 8 September, for example, they were questioned on the reasons why they were able to change position in spite of the prior legal advice received. Officials responded that the original legal advice was based on taking forward legislation for ACT only, whereas the current proposal is to deal with a class of projects, namely, non-wind. At no time did the Committee suggest or even consider the possibility of taking forward legislation for ACT only — at no time. It was always the Committee’s view that wind and non-wind could and should be decoupled, given the circumstances that we were in. Where the Department got the idea that it should take legal advice on taking forward legislation for ACT only remains a mystery.

At our Committee meeting on 22 September, we asked the Department for clarification on the nature of the legal advice sought, and we received that confirmation. It turns out that what the Department had emphasised to the Committee was legal advice sought previously in June, and the stuff that we were supposed to make a decision on the SL1 about was, in fact, in its words, "based on an informal request for quick advice" — I could interpret that to be a one-minute or two-minute phone call, but that is my interpretation, by the way — rather than official, formal legal advice to the Department. We were expected to make decisions at a Committee on a poorly prepared SL1 on the basis of an "informal request for quick advice".

The way in which this matter has been handled by the Department leaves much to be desired and many unanswered questions, such as: why was the Department so adamant that the wind and non-wind aspects could not be decoupled when, clearly, as we see today, they could?; and why did the Department not try harder and earlier to negotiate with DECC? It was only when departmental officials were questioned at the Committee about renewables and the contribution by DECC that the Department was positioned to reopen negotiations with DECC, which, I hope, will be beneficial and productive, but that question remains: why did the Department not try harder and earlier to negotiate with DECC? Why did it rely on the intervention of the Committee before taking action to protect consumer interests? Why did the Department try so hard to push the original legislation through the Committee for the benefit of developers without having given any consideration to the relative costs and benefits to consumers? If the 9 July deadline was so critical, why did the Department wait until 8 September before coming back to the Committee? Why did the Department try to convince the Committee in July that a solution had been agreed with DECC when, clearly, no such solution, with even the craziest of imaginations, could have been interpreted as having been negotiated? The matter still has not been resolved. What was actually said in those conversations between DECC and DETI officials that resulted in DETI being able to brief the Committee with confidence that the issue had been resolved, when it clearly had not and still apparently is not? Why did the Department robustly defend its original proposal by telling the Committee that it was based on legal advice when, in reality, it was based on nothing more than an informal request for advice?

The Committee will want to get answers to all those questions. If need be, officials and the Minister will be called to the Committee to provide answers and clarity on this matter. We are there for one interest, which is to defend the public interest and the interests of consumers. That is our job. If necessary, the Committee will seek the attendance of appropriate representatives from DECC to ensure that members are provided with satisfactory and clear explanations.

Having given the policy proposals full consideration, the Committee was content and acted efficiently when it got the Department's decision to adopt our suggestion and decouple two aspects of the legislation. The Committee considered the statutory rule in respect of non-wind projects at our meeting on 22 September 2015. The Committee is content that the legislation is appropriate and recommends that SR2015/325, the Renewables Obligation Closure Order (NI) 2015, be affirmed by the Assembly.

Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin 12:45 pm, 28th September 2015

Go raibh maith agat, a Cheann Comhairle. Tá áthas orm an tAire a fheiceail ar ais anseo inniu agus ba mhaith liom tréaslú agus aontú le cuid mhaith dá ndúirt an Cathaoirleach ar an Choiste. I welcome the newly appointed economy Minister back to the Chamber. I also want to echo many of the sentiments expressed by the Chair of our Committee. Minister, we have missed you; I know that you have missed us as well. When I was at primary school, we had an attendance inspector who was very efficient. She used to go to your home and speak to your parents. I am not citing any particular experience of that, but she would say, "It's not good enough just to go back for one day." I want to repeat that advice today. I really do hope that you will be around for longer than a few hours because this, as you know and understand, Minister, is crucial to the economy, the public interest and consumers. We must try to stick at this and stay focused on this issue of renewables until we sort it out.

I thank the Minister for introducing the order. The Chair of the Committee has explained the yellow brick road that we have been down over the summer. It is a matter of some regret that, even today, we do not have certainty on whether, during a grace period, costs will be carried only by the consumers here or will be socialised across Britain and here, which, of course, would not really place any burden on consumers; it would only be a matter of pennies. As we push forward, the Chair of the Committee issued a number of what I think were invites. They were in very firm language, but we hope to see the permanent secretary and the Minister as well so that we can continue this discussion.

As we wade through these difficult questions about renewables, I think that there is one crucial issue. It is a question for the Secretary of State for Energy and Climate Change, Amber Rudd, as well as for us. Where do we go, post-2017, after the grace periods? What will our strategy be for renewable energy? How do we continue to maintain the momentum we have, in particular on wind energy onshore, which we know brings great benefits in green energy and consumer costs? That is a question that I hope that we can tackle even in this mandate to decide where our policy will bring us. Although Mr Cameron and Amber Rudd have turned their face against renewables, that is not what we want to do. We want to continue to build our green energy commitment. I hope that is a discussion that we will have with the Minister and the Department when he returns full time.

Photo of Stewart Dickson Stewart Dickson Alliance

First, like others, I welcome the Minister to the House. It is just a shame that it is effectively a piece of legislation that this House needs to deal with that has brought him to the House. I would like to ask him about something when he goes back to his ministerial colleagues. This is a serious point.

I appreciate the importance of the legislation, but, Minister, there is a great deal of other important legislation that needs to be dealt with in the House. There are also very important matters that need to be dealt with in the House. I am strongly in support of good-quality environment measures and of the renewables and alternatives to carbon energy in Northern Ireland, but I am equally passionate about those patients who are caught in long queues for cancer treatment; I am equally passionate about street lighting and roads; and I am equally passionate about a whole range of issues that I, as an elected representative sent to the House by the people of East Antrim, cannot do because of your party and its silly stunt antics. That is what you are doing; you are making a farce of this place. You are here today because you know that the legislation has to pass.

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

You should stick to the motion, if you do no not mind.

Photo of Stewart Dickson Stewart Dickson Alliance

Yes; thank you, Mr Speaker, for directing us back to the motion. You are absolutely right. This is an important piece of legislation that needs to be dealt with. On the one hand, we have heard the serious concerns raised by the Committee in respect of the path and the roadway to where you are in respect of this very important debate. Listening to the Chair of the Committee, it clearly seems that you and your Department, Minister, have failed to take on board much of the debate and conversation because you spent the summer doing other things rather than the job that you were elected to do in the House.

I share the concerns that the Chair of the Committee highlighted about the legislation, but, equally, I respect his comment that, at the end of the day, it is essential that the order be passed in order to ensure that Northern Ireland is kept in the appropriate place in the processes that we need to go through.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Basil McCrea Basil McCrea NI21

The Member supported the Chair of the Committee talking about the increased burden on the consumer. Would he care to comment on the fact that Northern Ireland has the most expensive electricity in the United Kingdom and that 42% of our consumers are living in fuel poverty?

Photo of Stewart Dickson Stewart Dickson Alliance

I thank the Member for his intervention and wholeheartedly agree with him. On a daily basis, I see the effect that two power stations in my constituency have in contributing to those costs, at Ballylumford and at Kilroot, the history of which comes back to former direct rule Ministers and where we were in respect of the cost of energy, but the Assembly, the Minister and his predecessors have had ample opportunity to resolve many of the mistakes that were made in the past. I sincerely hope that we are not heading down a route where we see those direct rule Ministers in place again, making the same stupid, irrelevant and costly decisions for the people of Northern Ireland.

Fuel poverty is real; it is in your face. It is where people have to scrape together — I have been there and have seen it — the change out of their purse or their pocket to buy a power card to top up. That is the real face of fuel poverty. That is why it is important that we get our whole energy pricing and production in the right place in Northern Ireland.

We are ideally suited in this part of the world to benefit from wind power, but we have to have a strategic approach to that. There are those who say, "Not in my back yard". That is a matter for the Environment Minister and for quality planning decisions. That is for strategic decisions, but those decisions need to be made in conjunction with the Minister who is here today to ensure that we get best value for money in the delivery of all of that.

The current UK Government seem to have gone off the rails when it comes to renewable energies. They are cosying up to their Russian friends to buy gas rather than ensure that we have a renewable energy source that is fit for purpose and which will deliver for people. Driving through my constituency, when I see windmills and speak to people about them, some people like them and some people consider them an eyesore, but everybody says, "Am I getting value for money when I see that on the landscape?". The reality is that, unless this Minister digs in and does the job he was elected to do, nobody will get value for money when it comes to paying for their electricity or the other energy sources available to them.

Photo of Jim Allister Jim Allister Traditional Unionist Voice

Does the Member have any concerns about reports about the activity of lobbyists in respect of some major renewable energy companies that are active in Northern Ireland and about whether such lobbyists are having undue influence on departmental policy?

Photo of Stewart Dickson Stewart Dickson Alliance

I think it would be abhorrent to hear that lobbyists have undue influence. I have no problem with those who wish to set out their stall in respect of whatever arguments they are making to Departments, but it is quite clear that the buck stops with the Minister. It is his role to ensure that those who lobby do so fairly and in a straight manner and ensure that he is free and unshackled when it comes to making appropriate decisions.

At the end of the day —

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Basil McCrea Basil McCrea NI21

I want to pick up on the point made by Mr Allister. I was struck by the contributions from Members who spoke earlier in that an awful lot of them seemed to be about the needs of individual projects and companies. Does the Member agree that what is required is a long-term strategic approach and not one that is rushed into on the fly? We have some concerns about this. Perhaps the Member would dwell on how best to make sure that we are not in the pockets of lobbyists and that we make a proper decision.

Photo of Stewart Dickson Stewart Dickson Alliance

I wholeheartedly agree. Every day, we hear people saying that we need joined-up government. When it comes to renewable energy, it is vitally important that we see a clear road map set in front of us. It is vitally important that we see that it is not about lobbying for individual projects; instead, that it is about a comprehensive strategy. It is the Minister's responsibility, along with others in the Executive, to deliver that comprehensive strategy. Too often, we see the not-in-my-back-yard mindset. One windmill will pop up here and one project will pop us there, but if people were able to see that that constituted part of an overall plan for the delivery of renewable energy in Northern Ireland, it would get a great deal more buy-in from the general public.

As I said, I am passionate about the delivery of renewable energy in Northern Ireland. It is the way forward and it is vitally important. However, I stand here today in frustration at a Minister who is in and out of office, along with his colleagues. That Minister is not delivering for people; he is failing the people of Northern Ireland today, and he is pushing through a piece of legislation because he knows that he has to, otherwise we will be even further out of step.

Equally, I share the concerns of the Chair of the Committee. He said that we do not have that strategy and that we need it. He told us that the Committee has sought information again and again, and that that information has either had to be dragged out of departmental officials or that they or the Minister failed to turn up to explain. That Committee is made up of members who are willing to share their expertise and knowledge and want to gain expertise and knowledge from people who come to the Committee; but when it cannot operate due to the shenanigans that are going on in this establishment, it makes a mockery of what the Minister is trying to do here today.

I support what the Minister is doing. I support this tiny piece of legislation that he is attempting to put through the House today, but, in all honesty, I think that this Minister and his colleagues are making a total and utter mockery of this devolved Assembly. The sooner they stop it, the better. I encourage them to come back and do the jobs that they have been given.

Photo of Basil McCrea Basil McCrea NI21

Will the Member give way?

Photo of Basil McCrea Basil McCrea NI21

I am interested in the line of argument that Mr Dickson is developing. Can he examine why there is such urgency for the Department to push this through? Why was it necessary for a Minister who, up to now, had been taking post and resigning to stay on? What is so important about this particular bit of legislation that it has required a change of policy? There must be some reason for this.

Photo of Stewart Dickson Stewart Dickson Alliance

I am pleased at the question, but I think it needs to be directed to the Minister. I will speculate and suggest that would clearly be to the detriment of Northern Ireland if this legislation is not passed. Clearly, some funding has to come along with it, and there is a danger that we will be out of step with the rest of the United Kingdom if we do not pass this today. It seems to be rather selfish that the Minister and his Executive colleagues, rather than the total Executive, have debated the matter and decided that this is important to them, but what is not important to them is the queue of people waiting for cancer treatment and the people waiting for other decisions that various other Departments should and could be making on a day and daily basis. Those are the concerns that I have in all this.

I am tempted to suggest that, if other Members could make speeches, we could effectively filibuster and keep the Minister here for hours on end, but that would be us acting in a silly way. It is worthwhile stressing the importance of the legislation in front of us. It is important because it forms part of a wider strategy on renewable energy, it highlights and points out the failures of this Minister, the Department and the Executive to deliver a road map for renewables in Northern Ireland and, finally, it highlights the ridiculous situation — the very serious ridiculous situation — of revolving-door Ministers coming in and out of the Executive and their failure to do the job they are paid to do by the citizens who elected them here.

Photo of Basil McCrea Basil McCrea NI21

This is an interesting debate, if a little surprising. It is very nice to have a Minister here, particularly a renewable Minister, because we seem to renew him every single week. Maybe there will be some merit in that in the future. I hate to take credit for other people's work— Mr Allister can own up to that particular little joke.

There is something strange going on here. I am interested in energy. I have been to Ballylumford and various other power stations to see what is going on, and I am happy to engage with the industry. But this comes against a background. When you look at this originally, you see that we have to do something, because the Westminster Government have changed their position on renewables. I think that there has been a knee-jerk reaction to renewables and their cost, and that has precipitated a crisis of investment not just in this part of the world but throughout the United Kingdom. As someone who firmly believes in climate change, I will say that it is happening —

Photo of Phil Flanagan Phil Flanagan Sinn Féin

I thank the Member for giving way. The Member has rightly pointed out that the whole rationale for the debate is that the policy decisions in Westminster have changed. Given that electricity here trades on an all-island basis, does the Member agree that we should be incentivising renewable electricity generators in the future through an all-island system, where those costs could be socialised across electricity customers in all of Ireland, instead of piggybacking on to a system that can be changed at the whim of a British Minister who has absolutely no control, influence or understanding of our unique set of circumstances here?

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

Just before you resume, let me say that the speaker is well aware of the dress code and of how rigorous I am in ensuring that it applies to all Members. You are well aware that it applies to you. I regard your intervention and your speaking as contravening a ruling on this that I gave previously, and I will return to the matter.

Mr McCrea, please continue.

Photo of Basil McCrea Basil McCrea NI21

To deal with the substance of the point that was raised about whether we should be looking at an all-Ireland energy policy or how that would affect the legislation in front of us, I will say that, from what I know of energy policy, it takes place in a European framework. There is an issue about how we manage to deal with what, I think, are the worst excesses of a Northern Ireland energy policy that puts 42% of our people in fuel poverty. That is an intolerable burden, to which we now are apparently going to add.

The Chair of the Committee, in his submission, ran up to the brink three or four times; in fact, maybe even a dozen times. He said, "This is not acceptable; this is not right. We were not informed; we do not know." At the end of it, perhaps for pragmatic, legislative reasons, he said, "But in the end, we are going to support this." I am not sure that that is the right approach. I have not had the opportunity to understand what is motivating this legislation. <BR/>It is strange, Mr Speaker, that, in comparison with all other bits of legislation, when you have read out repeatedly over the last number of weeks, "The Minister is not available, so the motion cannot be moved" — really significant bits of legislation that I wanted to make a contribution on — the only bit of legislation that has thus far provoked a change in policy is this one: the seemingly obscure Renewables Obligation Closure Order. It does not exactly roll off the tongue; nor is it immediately apparent what exactly it is about. As someone whose job it is, along with my colleagues in this Chamber, to scrutinise orders, particularly those passed by affirmative resolution, I need to know more and to have a better, convincing story about why this legislation must go through. What is so important about it that it ranks above all other issues, including the health service, the economy in general and the Department of Social Development?

When I heard about the individual, specific projects, which the Chair of the Committee very clearly set out, it started to ring alarm bells with me. It appears to be that we have to pass this legislation or a specific project or a specific company will not invest. Do not get me wrong: I am not saying that we should not get investment. Investment is good; renewable energy is good; all these things are good. But when you start to bring in legislation specifically for the benefit of a particular project, it raises the spectre of undue influence from lobbyists and lobbying. That is a question that we need to address. Energy policy is one of those things that is so big and so expensive that it is hard to describe and to talk about it sensibly.

It is relevant to this debate that, as we have established, our legislation — this order — takes place against a UK legislative background. I am aware that Drax, the big power station that was talking about investing in CO2 capture, has pulled out of that investment, citing the fact that they have no confidence in the Government's long-term renewable energy policy. Now, if that is happening in that project, it will happen in all projects.

We talk about the exemption of onshore wind power in this order. I have sat in this Chamber and listened to Members saying time and time again that we have too many wind turbines. A Member of this Assembly, who is now in another place, talked about triffids marching over our landscape and argued that we do not need them anymore. I have heard MLAs bemoan the fact that we do not have the infrastructure to bring back the wind power from our most profitable areas in the west of the Province; I have heard MLAs talk about the dangers of wind turbines collapsing. Against that background, I am slightly curious about why we should exempt onshore wind specifically.

I would have thought, if we were going to take a strategic position, that we would be looking at things in the round. My understanding — I think the Minister said this at the start — is that we have met our targets, so why are we not talking about our future targets? I want to know whether we are going to put public investment into the infrastructure that brings energy back from the wind turbines and who will pay for that.

It was asked whether we should be in an all-Ireland energy market. The question is, why are we stopping the interconnector? Why are people here saying that they do not want an interconnector because of environmental issues or whatever? We have to make sure that we get an all-Ireland energy market, because that will be good for the people of Northern Ireland. All of that should be dealt with in this debate.

Mr Dickson suggested that, because this is the only bit of legislation that we have to debate, we could talk for some time on this, if we were so minded. We should talk for some time on this; we should be asking the questions; and we should be able to address the specific issues. I have never heard in the Chamber — I have been here for almost eight years — such a list of concerns from the Chair of a Statutory Committee left unanswered by a Department. There is a particular issue around why you would change your mind so quickly. How, from one week to the next, could you suddenly change and say, "Do you know what? We've solved it"? This is energy policy on the fly. This is a knee-jerk reaction, and it does not seem to be the right way to go about things.

Even though I am totally committed to the notion that climate change is a reality, we have to do something about it and we must invest in renewables, the renewables industry has lost the battle with the consumer. The consumer does not understand why prices are going to go up. Hard-pressed consumers are trying to find ways to put food on the table, keep their home heated and look after their family, and, if they hear that they will suddenly have to pay more — it is 42% of the population I am talking about — they will say, "Are you really sure that we have to make that investment? Are you really sure that it is the consumer who has to pick up the bill?". Those are legitimate questions, particularly for people in the west of the Province, where fuel poverty is concentrated, for citizens of Northern Ireland who are not on the gas main and for citizens of Northern Ireland who must take oil or other fossil fuels. They have a serious living standards crisis, and that is something that the Assembly ought to deal with.

I will conclude by saying that there needs to be a clear analysis of why specific projects are included in the discussion. I am not heartened by the fact that that is what this debate is all about. There should be some consideration of individual issues, but if we are going to let lobbyists manage this country, we might as well do away with the democratic institutions. All you will hear is, "You need to talk to the right people to see if you can get the right decision made. And, do you know what? Even if you are taking a huge political stance, we can turn it over just to make sure that we get an order through". That is not right; that is not democracy; and people ought to take a stand on it.

Photo of Jonathan Bell Jonathan Bell DUP 1:15 pm, 28th September 2015

This is a difficult subject. Energy faces something of a trilemma. My only interest and the only interest I will ever have is in trying to resolve in the best interests of everyone in Northern Ireland the trilemma that energy faces: how to deal with cost for domestic and commercial customers — we know how hard pressed many of our households are; I certainly do in Strangford; how we deal with sustainability; and how we deal with security of supply. Those are three of the most difficult and challenging issues that we have to face and try to get a resolution on that fits now and in the future.

It has been a lengthy process to get to this point. Throughout, it has been my aim to bring the NIRO to an orderly conclusion in a way that maximises renewable deployment in Northern Ireland at least cost to the consumer. The order achieves that balance for non-wind technologies. Today, I have signed off on proposals that will do the same for onshore wind. Those will be with the Committee today.

I want to respond to some of the issues that were raised. Mr McGlone raised issues of confusion, disorientation and a lack of leadership: I have no intention of getting into the SDLP's leadership debate. On this serious issue, the position on the non-wind closure has remained consistent throughout: closure in 2017, with a grace period to 2018 and the costs being socialised. Because of the cost implications, we have had to take account of the UK Government's changing policy regarding onshore wind. I wanted to give certainty to all developers, and I recognise — I had to recognise — that that would take longer for onshore wind. There is always more risk in taking different approaches, but you must make a judgement that is based on the balance of risks. If the decisions were entirely black and white and I could see the future, it would be simple, but that is not the reality. It was and has been raised —

Photo of Jonathan Bell Jonathan Bell DUP

No, I think that I have heard enough from you, Mr Allister. Your contribution was spectacularly poor, and it failed to detail any of the real issues that affect jobs and investment in Northern Ireland. It was my intention to —

Photo of Jim Allister Jim Allister Traditional Unionist Voice

On a point of order, Mr Speaker. Is it in order for the Minister to mislead the House by suggesting that I have spoken in the debate and made an inadequate contribution when I have not spoken in the debate at all? He is the one running away from a simple intervention.

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

I am more inclined to interpret that as a mistake than as a deliberate intention to mislead the House.

Photo of Jonathan Bell Jonathan Bell DUP

For the purposes of clarity, Mr Allister's contribution was inadequate to the matter here today. I have spoken to people who run businesses and to domestic consumers. We have spent hours looking at the trilemma that we face in energy policy, and anybody who looks at the serious issues, as opposed to the immature grandstanding of Mr Allister, will realise how inadequate his intervention was. Let me return to the serious issues. I want to provide —

Photo of Jonathan Bell Jonathan Bell DUP

I will come to you in a second, Mr McCrea.

I want to provide all developers with the certainty that they need. Unfortunately, as I said, the changes in the UK Government's policy position on the early closure of the renewables obligation in Great Britain to onshore wind created unavoidable delays due to the lengthy discussions that were held regarding the socialisation of costs. I want the least costs across the United Kingdom, both for —

Photo of Jonathan Bell Jonathan Bell DUP

I will deal with a range of things. Bear with me: I want to make some progress.

I want to deal with costs to householders who are struggling, but I want to do that in a balanced way that leads not to jobs leaving Northern Ireland but to sustaining the jobs that are already here and puts us in a position to take new jobs in the future.

In the Member's contribution, he said that I was not working over the summer, but, to the best of my knowledge, I announced 700-plus new jobs. The Member should consult his ministerial colleague Mr Farry about some of the work that we did on the financial services industry and listen to the speech that he gave that day. That seems to be at variance with what the Member has attempted to suggest to the House.

In August, in the absence of having that final policy position on onshore wind, I took the decision to close the NIRO in two stages. The rationale for that was to give clarity to non-wind developers, as we could not, then, set out a final policy on onshore wind. The proposed Renewables Obligation Closure Order (Northern Ireland) 2015 gives non-wind developers the legislative certainty that they require. A further NIRO closure, as I said, will be introduced to address onshore wind, and that will come to the Committee.

I will turn to the Member who spoke next, Máirtín Ó Muilleoir. Let me say clearly, which I did at the start, that the costs of non-wind will be fully socialised right across the United Kingdom. For me, that is a win for the domestic consumer and for business. It is me acting in the best interests of everyone in Northern Ireland.

In relation to Mr Ó Muilleoir's comments about posts, most reasonable people will understand that the murder of Kevin McGuigan was not something that we could just ignore and continue to do business as usual. We said at the time that it was not the case that we would not do business at all but that we could not do business as usual, given the seriousness, which has not been mentioned yet by those who would like to make their points, of the murder of Kevin McGuigan on our streets and the PSNI response to that. Everyone in the House should have taken that seriously and should have mentioned it, had they wanted to open that debate.

In further response to Mr Ó Muilleoir —

Photo of Basil McCrea Basil McCrea NI21

On a point of order, Mr Speaker. Although I sympathise with the statements being made, you have been, correctly, trying to keep our attention on the legislation in front of us. I wonder whether that applies to the Minister as well.

Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker

I am sure that you are not challenging the authority of the Chair. I consciously paid very close attention to the Minister's response to a number of contributions from Members. I felt that at least there was balance in the discussion. I would have brought the Minister back to the focus of the debate had he continued in that vein. He put on record his position in response to comments made by Members earlier, and I think that that was satisfactory enough.

Photo of Jonathan Bell Jonathan Bell DUP

Thank you, Mr Speaker. My response to a point raised by Mr Ó Muilleoir is that the existing support for renewable generation will continue post-2017 until 2037. It is anticipated that that will increase renewable electricity deployment in Northern Ireland to somewhere in the region of 30%. I think that that is a considerable achievement for a region of this size.

A decision on whether Northern Ireland should become part of the UK-wide contract for difference is a matter for the Executive. My predecessor consulted on this in March 2015, highlighting the key balance to be struck between further support for new development and the cost to consumers. Given the Conservative manifesto commitment to stop any future subsidies for onshore wind, it is sensible to take account of the UK Government's expected announcements in the autumn. That is because it could be disproportionately expensive to try to run a Northern Ireland-only scheme.

The issue of electricity prices was raised in the debate, and I am acutely conscious of it. The regulator and my Department have a responsibility to protect the interests of all consumers. We have tried to do so by promoting competition, supporting innovation and contributing to investment. I know that the cost of electricity, particularly to business, is as close to many Members' hearts and those of businesses in their constituencies as it is to mine and to those who raise such issues with me in Strangford.

Photo of Jonathan Bell Jonathan Bell DUP

I wish to make progress.

We have to be careful when talking about cost. My information is that the vast majority of Northern Ireland consumers have electricity bills that are around the European Union average, following falls in tariffs that were announced in April. Recent industry reports show that energy prices are at their lowest level for six years and that Northern Ireland gas bills are below the European Union average. I accept that a small number of very large consumers have electricity bills that are above that average but I also understand that, currently, they are lower than those in the rest of the United Kingdom as a whole.

Again, in terms of adding costs to people in fuel poverty, I put on record that the order for non-wind technologies results in costs being socialised. The renewable obligation levels —

Photo of Jonathan Bell Jonathan Bell DUP

Yes, go ahead.

Photo of Basil McCrea Basil McCrea NI21

Minister, I am wondering about your assertion on the progress on energy in Northern Ireland. Figures just released from the Department of Energy and Climate Change say that, last year, Northern Ireland bills rose by an average of £49, making them more expensive than anywhere in Great Britain. New figures from the Department show that, in 2014, average bills in Northern Ireland were £661, compared with a UK average of £592. That is for consumers. I think that there is a strange chasm between the figures that the Minister is relying upon and the figures produced by the Department of Energy and Climate Change.

Photo of Jonathan Bell Jonathan Bell DUP

That is why I think, Mr McCrea, we have to deal with what we are dealing with today. It is why I say to you that the order for non-wind technologies results in costs being socialised across the United Kingdom, which, therefore, means that there is no additional burden to Northern Ireland. That is why I have spent hours trying to ensure that we have got a way forward for Northern Ireland that does not lead to additional costs.

The renewable obligation level is a good deal for Northern Ireland. It is estimated to be in the region of 50% of the GB level. Let me repeat this again: it will not mean additional costs to Northern Ireland. That is why I have worked through, intensely, line by line, the sometimes changing position that has come from DECC. I can understand that Members have struggled as positions have changed and we have had to adapt to those positions. The urgency of today will, I think, be well understood out there in the business community, certainly the people I am speaking to, some of the major employers in Northern Ireland.

To conclude, this proposed rule will close the NIRO to new non-wind generation on 31 March 2017 and introduce closure grace periods. A further closure order will be brought forward to address the closure of the NIRO to onshore wind. That will also be subject to debate in the Assembly. I thank everyone who has contributed to today's debate. I commend the motion to the House.

Some Members:

He did.

Photo of Basil McCrea Basil McCrea NI21

Resign again.


Photo of Mitchel McLaughlin Mitchel McLaughlin Speaker


Question put and agreed to. Resolved:

That the draft Renewables Obligation Closure Order (Northern Ireland) 2015 be approved.