Northern Ireland energy strategy marks pivotal step in net zero journey

Matthew McMurray and Richard Murphy, energy law experts at Pinsent Masons, were commenting following the publication of the plan (11 pages/2.2 MB) which outlines a series of ambitious initiatives designed to accelerate the transition to a sustainable energy future.

Economy minister Dr. Caoimhe Archibald expressed optimism that 2025 will be a transformative year for Northern Ireland's energy sector, with the plan demonstrating the government’s commitment to enhancing renewable energy generation, improving grid infrastructure, and supporting innovative technologies.

McMurray shares such optimism. He said: “I am optimistic that 2025 will be the year that Northern Ireland shifts up a gear in terms of our transition to net zero. It will need to be if we are to hit our 2030 targets.”

The plan states that the final design of the Renewable Electricity Price Guarantee for Northern Ireland will be published in the second quarter of the year, before a consultation on the design in the following months. This scheme is considered crucial for providing a route to market for generators in Northern Ireland, ensuring a stable and predictable environment for renewable energy investments. The shape and structure of this scheme will be extremely relevant to developers and investors, particularly in relation to matters such as whether non-market based redispatch will be compensated for and eligibility requirements for projects.

The document also includes plans for draft legislation on offshore wind in order to develop the legal and regulatory framework for offshore wind generation. This includes provisions for decommissioning, safety zones, and environmental assessments which the experts anticipate will be broadly aligned with the equivalent legislation in Great Britain. The DfE will also confirm arrangements for connecting offshore generation to the network in 2025.

“It remains to be seen whether the proposed approach will align more closely with Great Britain, where independent third parties participate in competitive auctions to assume ownership of offshore transmission assets, or Ireland, where the national transmission system operator assume responsibility for all offshore transmission infrastructure,” McMurray said.  

There will also be continued support for biomethane which will include progressing support mechanisms and investigating standards and certifications, as well as a consultation on hydrogen policy before the second half of the year. Policy development in this space will be essential to help decarbonise those 'hard-to-reach' sectors of the economy that rely heavily on natural gas.

The plan also sets out to establish a grid development monitoring group to help with 2030 targets. This group will oversee the necessary enhancements to grid infrastructure, addressing issues such as the prevailing high levels of ‘dispatch-down’ in Northern Ireland and the socialisation of grid reinforcement costs.

Smart meters are another important element to help ensure 2030 targets are met, according to the DfE, with a smart meter design plan to be published in the coming months. An oversight group will be established with aims to help with a smooth roll-out and maximisation of consumer benefits. This will work alongside a DfE scheme outlining principles to further support use of low carbon heat and energy efficiency in homes.