Committee for Enterprise, Trade and Investment

Strategic Energy Framework

February 2009 – Responses to SEF scoping consultation

Jim McManus
Committee Clerk
ETI Committee
Parliament Buildings
Belfast
BT4 3XX
20 February 2009

Dear Jim

ETI COMMITTEE MEETING ON 26 FEBRUARY: FEEDBACK ON STRATEGIC ENERGY FRAMEWORK SCOPING CONSULTATION

At the ETI Committee meeting scheduled for 26 February it is to receive an oral update on the outcome of the recent Strategic Energy Framework scoping consultation.

By way of assistance I am attaching for the Committee’s information a short summary which sets out the broad thrust of comments received from respondees.

PAUL DOLAGHAN

NI STRATEGIC ENERGY FRAMEWORK PRE - CONSULTATION SCOPING PAPER – SUMMARY OF RESPONSES

1. Renewable Energy & Fossil Fuels

As expected there are common themes coming forward from the responses received from the stakeholders with environmental interests such as; the National Trust, Friends of the Earth, WWF and NI Environmental Link. All of those who responded agree that heavy investment is required in Renewable Energy, both large-scale and micro-scale, so that they provide an increasing proportion of our energy needs. Environmental groups are obviously highly in favour of exploring renewable energy technologies as a means to reducing dependence on fossil fuels.

Given that fossil fuels are a fundamentally finite resource, which increasingly have to be sourced from remote and unstable parts of the world at a steadily increasing cost; it is recommended that the SEF should aim to reduce Northern Ireland’s dependence on fossil fuels as rapidly as possible in favour of indigenous renewables.

Some of the Environmental Groups are keen to highlight the broad range of opportunities which exist for Northern Ireland in terms of the renewable technologies available. These include wind power (on shore and offshore), solar, hydro, wave and marine current power as well as bioenergy.

Those involved with power generation naturally have quite different opinions on the use of fossil fuels. Responses have been received from various groups including; NIE, Viridian, BGE, and ESB International. Even though they are predominantly in favour of renewable energy and believe that the technology should be embraced, especially wind and tidal stream which should be exploited in Northern Ireland, some are concerned that it is not yet far enough advanced to deliver the required results. They are of the opinion that areas highlighted in the SEF scoping paper such as system security management, network reinforcement and connection processes still need to be addressed. Others feel that the costs of meeting EU and prospective NI renewables targets could be substantial and need to be more accurately assessed.

There is also a view that fossil fuels will continue to be an essential part of the energy mix and will be needed as a backup to renewable energy, for example in times when there is not enough wind to generate power. It is suggested that non fossil fuels should be kept under constant review with the intention to switching dependence to these gradually over time, to the maximum extent possible, when the level of technological advancement for such fuels is sufficient to make such sources economic in the longer term.

Even though a good majority of the responses received from all stakeholders show strong opposition to the use of lignite and nuclear power due to their high costs both in financial terms and in terms of its impact on the environment, there is still a considerable number of respondents, particularly those with a vested interest in power generation, who consider that the use of lignite and nuclear power should remain as viable options for Northern Ireland. They feel that the case against nuclear power has not been made strongly enough and therefore should remain under consideration. They also insist that it is important to retain lignite as a strategic option as it is Northern Ireland’s only indigenous fossil fuel.

2. Reducing Carbon

The vast majority of Environmental Groups feel strongly that an improvement in building standards is required to decarbonise heat supply. This should apply to existing housing stock as well as new builds. Responses from these groups indicate that if housing stock was improved and the reliance on expensive and polluting fossil fuels was reduced, this would have a significant impact on the reduction of fuel poverty in Northern Ireland.

It is also generally agreed among Environmental Groups that a Northern Ireland Climate Change Bill with specific mandatory reduction targets should be introduced to act as the driving force towards a low carbon society. These respondents believe that a robust NI Climate Change Bill would provide focus and draw together a range of targets across government, while helping DETI to achieve its objectives in renewable energy and energy consumption.

Whilst these groups believe that a Climate Change Bill with legally binding targets and carbon budgets would ensure that Northern Ireland contributes fairly to the UK. action on climate change, one of the responses from those involved in power generation recommends that Northern Ireland should do no more than its “fair share” of carbon reduction as any more would compromise affordability and perhaps security. They recommend the “fair share” amount should be based on EU mandatory targets.

3. Energy Efficiency and Microgeneration

A number of respondents highlighted that energy efficiency has a major role to play in our climate change targets and that it might be better channelled through one department. One respondent indicated that there is little or no coordination in the whole area of energy efficiency.

Interestingly, the views on smart metering and its ability to contribute to energy efficiency varied considerably, some respondents felt they were key to offering up to 10% savings while others thought the economic case was not yet proven for smart metering.

The responses to micro-generation varied. Many respondents (including many of the environmental groups) indicated that the energy mix should include significantly increased levels of micro-generation coupled with feed-in tariffs, but recognised that large scale renewables offered better emission reduction. However, some recognised that further work on the cost and potential of micro-generation was required.

Provision of energy efficiency advice and better billing and metering was generally well received with one respondent stating that this should feature strongly in the SEF. Many respondents acknowledged that existing housing stock offers opportunities for improving energy efficiency.

Many of the responses agreed with DETI’s view that energy efficiency and managing demand are key and offer a ‘win win’ in terms of economic and environmental impact. A number of respondents indicated that energy efficiency should be more widely promoted.

4. Grid Infrastructure

Of the responses relating to grid infrastructure, two in particular from stakeholders with a focus on power generation consider it to be a key element in preparation for accommodating increased renewable energy. Whilst one of these respondents considers that there are limited opportunities to achieve the construction of new grid development within infrastructure corridors, both are very much of the opinion that a common agreed policy is absolutely critical to enable the delivery of grid infrastructure, renewable projects and associated initiatives to agreed timescales. They would suggest that in order to ensure targets are met and facilitate large projects such as grid extensions, a Strategic Infrastructure Planning Act/Order should be introduced similar to those introduced in Republic of Ireland and England and Wales.

Three of the five responses from the Environmental Groups suggest that an increase in renewable energy at large, community and micro scales, has the potential to relieve pressure on the grid at the same time as enhancing security and diversity of supply. They would urge DETI to mandate priority access to the grid for renewables ahead of fossil fuel power plants.

Some respondents felt that the centralised grid is highly inefficient with two thirds of energy wasted before it even reaches the consumer. For this reason responses from all but one of the environmental groups tend to agree that it would be better to decentralise the grid rather than improve existing infrastructure. Therefore, it has been suggested that a decentralised grid using small-scale generators close to the end user could minimise transmission loses and also enable the waste heat to be utilised.

5. Interconnection

Responses across the board show similar opinions with regards to interconnection. It is generally felt that this provides the means to optimise generation sources and provide an enlarged market for suppliers. An improvement in interconnection, both East/West and North/South would help to maximise the potential and economic viability of renewable resources. It is widely recognised that with interconnection comes the need for regional cooperation and coordination.

While most respondents agree that further interconnection along with coordinated energy policy making will deliver significant benefits to all consumers, some responses from those involved with power generation suggest that there is no obvious case for further interconnection post the second North/South and ROI/Wales interconnector. Direct interconnection with France in cooperation with RoI has been mentioned as a possible option although it is not clear that this would significantly enhance security of supply.

6. Natural Gas

The majority of those involved in power generation have responded in favour of the development of the natural gas network, particularly those with a vested interest in the gas industry. They are obviously in favour claiming that natural gas being the cleanest fossil fuel, because of its inherent low carbon content and greater efficiency, remains the most economically and environmentally sensible action for today.

Other responses from stakeholders involved in power generation point out that gas is also a diminishing fossil fuel which is also dependent on volatile political regimes for long term supply stability. One stakeholder in particular takes issue with the scoping paper’s claim that natural gas has considerable environmental benefits as a low carbon fuel. They claim that this conflicts with challenges in relation to cost and security of supply, and suggest that any roll out must be capable of delivering a net cost benefit.

7. Departmental Responsibilities

Three NICS Departments commented on the scoping paper, and all acknowledge the role that they have to play in achieving the main goals of the SEF. One in particular highlights the need to ensure that the cost of meeting sustainable heat and electricity targets is considered. It urges the Inter Departmental Working Group on sustainable energy to consider as part of its remit, the issue of policy mix, targets and cost options for the delivery of sustainable energy.

Responses from the majority of stakeholders across the board welcome the plans for interdepartmental working. However, numerous responses would take this further and recommend that one Government Department should have sole responsibility for all issues relating to energy and climate change as is the case in GB with the establishment of the Department of Energy and Climate Change (DECC). They would strongly urge that any energy and climate change responsibilities currently allocated to DOE, DARD, DFP and DRD should be examined and transferred to DETI to provide a strong consistent, joined up focus. Failing that, it has been suggested that DETI should provide strong leadership across departments which also have energy responsibilities with robust linkages to economic, regional, rural and social development, and transport.