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Enterprise, Trade and Investment Committee

Inquiry into Barriers to the Development of Renewable Energy Production and its Associated Contribution to the Northern Ireland Economy

TERMS OF REFERENCE

INQUIRY PROPOSAL

Background

1. The Committee for Enterprise, Trade & Investment held a workshop for stakeholders in the renewable energy sector in Northern Ireland. The workshop featured contributions from Small & Medium Sized Enterprises (SME) in the renewable energy sector and specialists in the fields of economics, energy and government. The workshop identified a variety of barriers that stakeholders believe are inhibiting both the development of renewable energy production and the potential of SMEs working in the renewable energy sector.

2. In advance of its workshop, the Committee launched its vision for the Northern Ireland renewable energy sector. The Committee’s vision is:

The Committee for Enterprise, Trade & Investment is ambitious for the development and promotion of renewable energy technology, both from an energy and from an enterprise perspective. To this end, the Committee wants to see a Northern Ireland which:

• Is self-sustaining in relation to heat and electricity
• Is a net exporter of energy
• Is a market leader and world class exporter of renewable energy technologies
• Exceeds the renewable energy targets in the DETI Strategic Energy Framework
• Uses the wide range of renewable energy opportunities available so as to optimise the use of all potential renewable energy resources at our disposal

The Committee will play its full part in supporting and challenging DETI, Government, the business sector and the renewable energy sector to help achieve this vision.

3. If the Committee vision is to be realised it is essential that both Government and the local renewable energy sector play their full part in overcoming barriers to the development of the wider mix of renewable technologies. Government and support organisations in the renewable energy sector must also support our SMEs in the sector to develop and grow both indigenous and export markets.

Purpose of the Inquiry

4. The Inquiry will identify the main barriers that are inhibiting the development of renewable energy production. It will also bring forward recommendations on how these barriers can be overcome in order to optimise the development of renewable energy technologies, the contribution of renewable energy to the local economy and the production energy from renewable sources.

Terms of Reference

5. The Committee will critically examine the current level of support and assistance made by key stakeholders in the renewable energy sector to the development and growth of renewable energy production. The Committee will make recommendations, where appropriate, on how good policies and practices can be built upon and on future mechanisms to assist the development of the local renewable energy sector.

6. Specifically, the Committee will:

• Consider the current mechanisms at national, regional and local level to support and assist renewable energy production;
• Compare the mechanisms for support and assistance in Northern Ireland with those in other EU member states considered to be in the forefront of renewable energy development;
• Examine the support and assistance available to SMEs in the renewable energy sector to develop renewable energy technologies;
• Examine the support and assistance available to SMEs in the renewable energy sector to grow and develop their businesses;
• Assess the appropriateness of current mechanisms to develop and grow both local renewable energy markets and export markets;
• Assess which EU member states are considered to be in the forefront of renewable energy development both overall and for each type of renewable energy; and
• Report to the Assembly with full findings, conclusions and recommendations for overcoming the barriers to the development of renewable energy production and its associated contribution to both the energy mix and the Northern Ireland economy.

Approach to the Inquiry

7. The Committee will call for evidence from identified key stakeholders including (but not restricted to):

• Electricity generators and suppliers;
• Northern Ireland businesses in the renewable energy sector;
• Department for Enterprise, Trade & Investment, Energy Division;
• Department for Enterprise, Trade & Investment, Strategic Policy Division;
• Invest NI;
• Other relevant committees and Government departments;
• The Northern Ireland Authority for Utility Regulation;
• Action Renewables;
• The Single Electricity Market Operator; and
• System Operator Northern Ireland.

8. A general call for evidence will also be made through the local press. On the basis of written evidence submitted, the Committee will decide which organisations and individuals to invite to provide oral evidence to the Committee.

9. The Committee will undertake visits, as appropriate, to gain a practical understanding of the issues involved and the problems faced by key stakeholders. Such visits may be inside or outside Northern Ireland.

10. Assembly Research will be asked to undertake appropriate research to inform the Committee and, if appropriate, specialist research may be commissioned from outside the Assembly. Initially, research will be undertaken into:

• Comparative analysis of Renewable Obligation Certificates (ROCs) and Feed-in Tariffs (FITs) as mechanisms for supporting and incentivising renewable energy production;
• Comparative analysis of the support and incentives available in Northern Ireland with other UK regions and other EU member states; and
• The impact and future potential of the GB Energy Act (2008) to increase renewable energy production.

11. Those providing written evidence to the Committee will be asked to respond by 6th August 2010. Oral evidence will be taken between 7th October and 11th November 2010. The Committee intends to report to the Assembly with findings, conclusions and recommendations by 24th January 2010.

Constraints

12. As transport fuel falls outside the remit of the Committee for Enterprise, Trade & Investment, it will not be considered as part of the Inquiry.

13. The Committee recognises that large scale on-shore wind production is well developed in the region and has therefore excluded this sub-sector from the Terms of Reference for the Inquiry.

14. The Committee recognises the complexities associated with off-shore technologies such as off-shore wind, wave and tidal energy and, although these technologies will be considered as part of the Inquiry, it is not envisaged that specific recommendations will be brought forward in relation to these technologies.

Expected Outcomes

15. The expected key outcome of the Inquiry will be a report outlining the findings, conclusions and recommendations of the Inquiry. It is also expected that the Inquiry Report will be debated in plenary session in the Assembly.