Energy Prices (Domestic Supply) (Northern Ireland) Regulations 2022

Lord Browne of Belmont Excerpts

Wednesday 16th November 2022 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, these regulations were laid before the House on 31 October 2022. They are quite narrow and define the terms “Northern Ireland domestic electricity supply” and “Northern Ireland domestic gas supply” for the purposes of the energy price guarantee Northern Ireland schemes. I will refer to these schemes as the “EPG NI”.

Energy is of course an essential and unavoidable expense for households. The economic fallout of the Covid-19 pandemic and the ongoing war in Ukraine have driven a global inflationary surge that is continuing to hit UK households and businesses. A typical household in Northern Ireland has seen its energy costs increase threefold since this time last year, which will put significant financial pressure on Northern Ireland households. The Government have moved swiftly to introduce emergency legislation to protect consumers from these inflated prices and to limit inflation.

The electricity and gas markets operate differently in Northern Ireland. There is a different regulator—the Utility Regulator for Northern Ireland—no price cap and an entirely different set of suppliers. Therefore, Northern Ireland could not fall under the remit of the Great Britain energy price guarantee scheme. The Government have established the energy price guarantee Northern Ireland scheme to deliver much-needed equivalent support.

The EPG NI reduces the unit cost of electricity and gas for domestic consumers in Northern Ireland, via the same mechanism as the energy price guarantee in Great Britain. Energy suppliers reduce consumer bills by a set amount of pence per kilowatt hour, and His Majesty’s Government compensate them for that reduction. Electricity costs are being reduced by 20 pence per kilowatt hour and gas by almost 5 pence per kilo- watt hour.

Importantly, the EPG schemes in Great Britain and Northern Ireland are intended for customers on domestic tariffs. The energy bill relief scheme is for customers on non-domestic tariffs. The Energy Prices Act 2022 set out that the EPG Northern Ireland schemes are to apply to those with “domestic electricity supply” and “domestic gas supply”. These regulations define those terms for Northern Ireland.

These definitions will mean that some non-domestic premises will be in scope of the energy price guarantee electricity scheme in Northern Ireland. This includes some places of worship, which have similar metering and tariff arrangements to domestic premises. These non-domestic premises will receive EPG support. There was no timely way for energy suppliers to disaggregate them from traditional domestic premises with similar metering and tariff arrangements.

The Government want to ensure that energy users in Northern Ireland receive equivalent support to that offered to Great Britain. By a quirk of the electricity market in Northern Ireland, a bespoke definition of domestic electricity supply was required for the timely establishment of a scheme in Northern Ireland. That is what these regulations do, and I therefore commend them to the Committee.

[Lord Browne of Belmont (DUP)]

My Lords, I welcome this instrument. It will go some way towards alleviating hardships in many Northern Ireland households.

Energy supply in Northern Ireland is very complicated because Northern Ireland has a separate energy market from the rest of the UK, with its own rules and regulations, but, as in the rest of the UK, energy costs continue to rise at a very high rate. One problem is that two-thirds of households in Northern Ireland use heating oil but, unlike in Great Britain, the oil market in Northern Ireland is not regulated. Is there any consideration of how those who use oil will be compensated? There is great competition in the oil market in Northern Ireland, and so many suppliers, so the prices can be kept at a reasonable rate.

Turning to gas, in the past 12 months both Northern Ireland gas providers, SSE Airtricity, which supplies Greater Belfast, and Firmus Energy, which supplies townlands, have increased their prices many times. There is a problem here. The gas market is even more complicated because the Utility Regulator must approve any tariff changes proposed by Firmus Energy in its 10 townland networks, but not in Greater Belfast. SSE Airtricity must also go through the regulator.

The main electricity provider in Northern Ireland is Power NI, which is overseen by the Utility Regulator, but there are other electricity providers in Northern Ireland, which increase their prices. They are not subject to the regulator and can put up their prices at any time. Has that been considered?

United Kingdom Internal Market Bill

Lord Browne of Belmont Excerpts

2nd reading & 2nd reading (Hansard): House of Lords
Monday 19th October 2020 Lords Chamber

[Lord Browne of Belmont (DUP) [V]]

My Lords, when we, as one nation, fully transition out of the EU, we must face the new reality and its challenges together and continue to work to maintain and grow the links and ties between all four corners of this country. That means building on the work to date and improving relations throughout the United Kingdom. For the avoidance of doubt, I emphasise that my party, the Democratic Unionist Party, believes that the progression of the Bill is of the utmost importance.

Vast swathes of the withdrawal agreement were wholly unsatisfactory, as in essence they created an unthinkable scenario for anyone who values the United Kingdom: a virtual border in the Irish Sea. Strands of the withdrawal agreement also made provision for a series of potentially complicated and burdensome checks on food and agricultural products entering Northern Ireland from mainland Britain. As a result, some in Northern Ireland, instead of benefiting from the removal of red tape as we leave the European Union would be required to endure extra layers of it. I welcome the Government’s assurance to the contrary, but we must continue to do all we can to ensure that there are no long-term, damaging barriers between different parts of our nation.

The withdrawal agreement and the political declaration, although in parts unsatisfactory, recognise the autonomy of the EU and the UK. However, a unique difference remains between the two parties: while the United Kingdom is a legally defined and globally recognised sovereign nation-state, the EU is simply an international body. During its history, and at the outset of the withdrawal negotiations, the EU recognised the sovereignty of the United Kingdom. Since then, regrettably, negotiators and some spokespersons appeared to disregard this sovereignty by ignoring the settled status of Northern Ireland, thereby interfering in internal matters and potentially undermining the defined constitutional status of Northern Ireland. Comments from officials in Brussels have been unhelpful and have shown a disregard for Northern Ireland’s unique and deeply troubled past, our shared future and the UK’s legal status as a sovereign nation.

Though I welcome the Bill, it remains true that businesses in Northern Ireland are confused. They may still have to adhere to conflicting regulations. There may still be divergence and associated costs. A scenario is still possible whereby a firm located in Belfast is unable to benefit from financial assistance that is available to one in Birmingham or Swansea, and therefore finds it advantageous to relocate. Can the Minister specify whether the Government plan to include Northern Ireland in the provisions outlined in Clauses 42 and 43?

In the other place, my party sought to allay fears by ensuring, through amendments, that the Government carried out impact assessments. Our purpose was to bring some reassurances to businesses that are potentially unfairly disadvantaged compared to their counterparts in mainland Britain. It is essential that we ensure the long-term prosperity of Britain and the viability of businesses. One part of our nation should not be left behind simply because of the proximity of a land border. I firmly believe that there is widespread support for a sensible free trade agreement with the EU that allows the UK to establish itself as a strong. outward-looking trading nation. A free, independent and United Kingdom can, and should, be a major global force on the world stage once more. I support the Bill.