Draft Energy Prices Act 2022 (Amendment) (Northern Ireland) Regulations 2026

Debate between Jim Allister and Martin McCluskey

Tuesday 2nd June 2026 General Committees

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Martin McCluskey)]

I beg to move,

That the Committee has considered the draft Energy Prices Act 2022 (Amendment) (Northern Ireland) Regulations 2026.

It is a pleasure to serve under your chairmanship, Sir Alec. The draft regulations were laid before the House on 16 March.

This Government are fully committed to fighting people’s corner to tackle the cost of living crisis across the United Kingdom. We are taking action on the matter as a priority and we are supporting devolved Governments to act when that is within their purview. I work closely with Ministers in the devolved Governments, including the Northern Ireland Executive. That covers work on the Budget commitments we are discussing, and more widely on the situation for energy consumers across the UK.

At last year’s Budget, alongside several positive changes to help working people across the country with the cost of living, the Chancellor announced significant changes to the cost of energy for households. Let me first set out the implications of those changes for consumers in Northern Ireland, before I turn specifically to the draft regulations.

The Budget set out that we would remove certain costs from energy bills in Great Britain, which led to energy bills in GB falling by 7% from 1 April this year. That reduced costs on bills related to the renewables obligation and the energy company obligation. Northern Ireland is in a different position as part of the single electricity market across the island of Ireland. Energy affordability is largely a transferred matter for the Northern Ireland Executive. From the outset of the Budget, however, we were clear that we would support the Executive to develop a comparable offer and that, subject to a business case, the Treasury would make such funds available.

The Northern Ireland Department for the Economy has since developed a proposal to remove costs—about £30 a year—from electricity bills, totalling £81 million of support over three years. That figure arises because in Northern Ireland, the starting point of policy costs on those bills is different from in Great Britain. In official-level discussions in the wake of the Budget, my Department and the Northern Ireland Department for the Economy worked closely to share learning about the policy design and its legislative basis. That joint working has supported the Northern Ireland Department’s development of its parallel policy.

On 2 March, the Minister for the Economy in Northern Ireland, Dr Caoimhe Archibald, wrote to me to ask that we take forward regulations to support delivery. We laid the draft regulations before Parliament a fortnight after receipt of that letter, and we are discussing them today. Although we are making the regulations to ensure that the Northern Ireland Department for the Economy has the powers it needs, I should be clear that it is entirely for the Northern Ireland Department to exercise those powers, and for the Executive to announce further details on the policy that they are taking forward.

Let me briefly set out precisely what the draft regulations do. They do not give the Northern Ireland Department any new powers that it did not already have in March; they amend the period in which various Energy Prices Act 2022 powers are available to the Northern Ireland Department. Those include a spending power and a direction-making power analogous to those we have used to deliver reduced costs on bills in GB. The effect of the amended time periods is that those powers will now be due to expire in February 2030. They should therefore be available to the NI Department for the duration of the transfer of the renewables obligation cost to the Exchequer.

[Jim Allister (North Antrim) (TUV)]

Apart from the fact that, because we are in effect under the EU-controlled single electricity market, our prices are so much higher than those in GB, I am particularly intrigued to understand the thinking behind a point made in the explanatory notes. It indicates that the extensions apply only so long as the First Minister and Deputy First Minister are in office. What is the correlation and why is that correlation there?

[Martin McCluskey]

That was part of the Energy Prices Act, as passed into primary legislation in 2022. It was intended to ensure that the powers were functioning at the time when the Executive were formed. I will go into more detail later.

As I was saying, the EPA powers available to the Northern Ireland Department include a spending power and a direction-making power analogous to those that we have used to deliver reduced costs of bills in GB. Those powers will now be due to expire in February 2030. I do not expect my Department to need to take further legislative steps in relation to policy in Northern Ireland, with the Executive now taking on its implementation.

Before I close, I repeat what I said when discussing the parallel regulations on the Secretary of State’s power: this is being taken forward in an international environment that is different from the one in which last year’s Budget took place. That difference reinforces the importance of what we are doing, but we also recognise that further steps may be needed. We have set out what we are doing in relation to heating oil, and contingency planning is under way in case further responsive and responsible action is required.

Ultimately, the draft regulations amend the period in which powers will be available to the Northern Ireland Department for the Economy, following a request from that Department to ensure that it can act as it needs to in order to reduce energy bills. I commend the draft regulations to the Committee.

Heating Oil Support

Debate between Jim Allister and Martin McCluskey

Monday 16th March 2026 Commons Chamber

[Martin McCluskey]

I completely agree with my hon. Friend. We must ensure that support is available in all parts of the UK as quickly as possible. In England, it will be available through the crisis and resilience fund from 1 April.

[Jim Allister (North Antrim) (TUV)]

In my constituency, an oil refill that was costing less than £500 costs well over £1,000 today, so I am rather underwhelmed by a package that offers a household £35 pro rata. How does the £53 million for the whole package compare with the increased VAT tax take from the rise in the price of heating oil? I suspect that it does not compare favourably. Would not the fairer—

--- Later in debate ---

[Jim Allister]

Would the fairer approach not have been to suspend the 5% VAT on home heating oil? Would that not have been fairer to everyone?

[Martin McCluskey]

My priority and the priority of the Government has been to ensure that support gets to people as quickly as possible, which is what we are doing today. The pro rata suggestion that the hon. and learned Gentleman has just made misses the fact that not everyone will fill up their tank during this period when prices are high. We do not know where the situation in the middle east is going, and we do not know what prices are going to be like two, three, four or five weeks from now. However, as I have said in response to other hon. Members, we will review the situation as it progresses.