Committee for the Economy: Energy Strategy Report

Part of Committee Business – in the Northern Ireland Assembly at 3:30 pm on 23rd November 2020.

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Photo of Caoimhe Archibald Caoimhe Archibald Sinn Féin 3:30 pm, 23rd November 2020

The Committee recently undertook a micro-inquiry to seek views from stakeholders on what they wanted to see in the energy strategy being developed by the Department for the Economy. That is in the context of the British Government's legislative target of net zero carbon by 2050. The energy strategy will determine the future priorities and potential changes needed to achieve that and other targets. During the inquiry period, earlier this year, the Committee asked stakeholders a range of questions about what they would like to see as the key elements of the energy strategy, what the future holds for the renewables industry and whether there would necessarily be a difference in the price of energy for business and consumers in the future. The Committee received over 180 responses from across energy organisations, consumers, individuals, businesses and academics. I put on record my thanks to those who took the time to respond.

The Committee has produced a special report summarising the themes that have emerged. It has shared the inquiry report with the Economy Minister, and it is that report that we are discussing today. In addition to the inquiry, the Committee heard evidence from departmental officials on the energy strategy and has, on the whole, relayed its encouragement of the process for the development of the new energy strategy, the progress of which the Committee will continue to monitor regularly.

Through the micro-inquiry, the Committee identified issues that will need to be addressed in the energy strategy. We are about to go through a massive upheaval of the whole energy system through the electrification of heat and transport systems, and it is important that stakeholders are involved in shaping the design along with government. <BR/>First, the energy strategy must have a statutory footing and binding targets that are clear, measurable, ambitious and in line with both the Programme of Government outcomes and the UN sustainable development goals. From looking in more detail at the current targets, we see that there may be scope to reduce greenhouse gas emissions by at least 45% by 2030 on the basis of the Climate Change Committee's (CCC) recommendations, with a view to assessing the feasibility of a 70% reduction by 2030. The energy strategy should implement policies towards those targets while moving towards a target of net zero carbon before 2050. To that end, consideration should be given to establishing an NI climate Act along the lines of those already designed in Scotland and Wales.

The Committee is alive to the fact that the UK Office for National Statistics (ONS) family expenditure survey shows that households in the North spend a higher percentage of their income on energy than those in other regions. More than one in five households here is in fuel poverty, so they cannot afford to spend more on energy bills. To tackle that, we must turn our attention to enhancing the existing energy efficiency schemes to ensure that homes and businesses are as energy-efficient as possible. That will lower consumption and, therefore, bills. In that regard, it is crucial that energy efficiency targets be identified and set, together with new building regulations that future-proof the energy efficiency of new developments. Above all, the most vulnerable must be protected during the energy transition.

Investment is urgently needed in a number of areas. With regard to transport infrastructure and the rise in the number of electric vehicles, there is clearly a need for investment in car-charging infrastructure. That, along with a modal shift to encouraging walking, cycling and using public transport, will have a significant impact on carbon emissions. Investment is also required in the electricity grid, with the successful deployment of large-scale renewables projects. That is becoming urgent, as it is needed to allow renewable energy to enter the system.

Careful adjustment is necessary for the planning system to succeed in allowing forms of energy production such as wind turbines and energy storage areas. Additionally, smaller companies wishing to install renewable energy technology may need to access funding support schemes to help to cover the initial outlay and to reduce financing risks. The ability to store energy will play a significant role in bringing more renewables on to the system. To that end, we need a separate action plan to encourage large-scale storage, localised storage and biogas. In relation to the natural gas network and its expansion, hydrogen is increasingly seen as a green fuel for the future that could replace natural gas. We note that plans are under way for gas networks to transition to hydrogen over the coming three decades.

Some sectors will be able to make a bigger contribution than others to lowering carbon emissions; for example, agricultural practices. The main opportunities for reducing emissions from agriculture are evidenced in crop and soil management and measures to reduce livestock intensity. However, there is a role for increased energy efficiency. To achieve all that, we need the local workforce to develop a suitable skill set to take forward new technologies and infrastructure.

An effective strategy should identify key areas of work for government, local government, educators, businesses and communities and, preferably, should be co-produced to maximise the available expertise and ownership of the changes to take place. There is so much to do. As, I am sure, you will recognise, the energy strategy has the capacity to be one of the biggest issues that our economy can gain from right now. The energy strategy has a considerable role to play in making the North a place that is investable, particularly through having the levers to keep manufacturing facilities here and being able to expand them. The Committee's primary concern, while meeting the carbon net-zero target, is to make energy affordable, so that businesses and consumers can thrive and enjoy higher levels of health and well-being. We have to get this right.

I will now make some remarks on behalf of Sinn Féin. Sinn Féin made submissions to the DFE call for evidence and the Economy Committee's micro-inquiry. Tackling the climate emergency is one of the fundamental challenges of this century. It is an issue that we have discussed a number of times in the Chamber. In January, the first motion that Sinn Féin brought before the Assembly was to declare a climate emergency. Since then, a climate change Bill has been submitted with cross-party support. That is an important basis for dealing with the challenge of climate change. However, the strategies underpinning the legislation will be key to achieving the targets. The energy strategy is one of the most important. It cuts across Departments and sectors. It is also a real opportunity to lay down a marker about the approach that we want to take to the decarbonisation of our economy and society.

Sinn Féin believes that the energy strategy must be based on a number of principles. Foremost of those is a just transition. As we seek to move rapidly away from fossil fuel dependency, there is an opportunity to tackle the economic status quo that has caused and exacerbated the climate crisis and to reshape our economy, creating a fairer, more equal and sustainable society. The COVID crisis has brought into sharp focus economic inequalities. As we plan our recovery, it is critical that a just transition approach is core to economic rebuilding. The second is public and community ownership of energy and renewable resources. Across the island, we have the resources that can be harnessed to provide the energy that we need. Communities and the public should have the opportunity to benefit directly from those abundant resources. Democratising our energy market not only gives communities a financial stake but increases the awareness and buy-in from the public towards the goal of decarbonisation. The third is rural and urban equality. Tackling regional imbalances in energy supply must be part of the energy strategy. On the basis of the principles of just transition, the barriers faced by rural communities — for example, the lack of public transport — must be taken account of. The fourth is a green new deal, which was a commitment in 'New Decade, New Approach'. As I have said, it must be one of the key facets of our economic recovery strategy. The potential of our renewable resources provides huge opportunities for the creation of green-collar jobs through investment in research and innovation, infrastructure and skills development. Finally, the climate does not recognise borders, so, on this small island, there needs to be strong cooperation. Our energy market is already integrated, and we must ensure that our energy strategy takes account of that. It must harness modern technologies to assist in achieving our emissions reduction targets. An energy strategy based on those principles, with ambitious targets that are reviewed regularly and sectoral plans, would go a long way to achieving the progress towards decarbonisation that we need to see in the short, medium and longer term.

I thank those who shared their views with the Committee. The report is available on the Committee's web page on the Assembly's website. I encourage anyone with an interest in the subject to read it and to continue to engage with the development of the energy strategy. I commend the motion to the Assembly.