Northern Irish large onshore wind subsidies to end in line with mainland UK, DETI confirms

Out-Law News | 08 Mar 2016 | 5:41 pm | 2 min. read

The Northern Ireland Renewables Obligation (NIRO) is to close to new large-scale onshore wind projects from 1 April 2016, "to align with the approach being taken" on the UK mainland, the Department of Enterprise, Trade and Investment (DETI) has confirmed.

Projects that meet certain eligibility criteria will be able to apply to accredit under the NIRO until 31 March 2017, while further grid and radar delay grace periods will operate for certain projects, according to DETI's consultation response. The NIRO will remain open to small-scale onshore wind of up to 5MW in generating capacity subject to further consultation, DETI has announced.

DETI minister Jonathan Bell said that he had attempted to secure "a more favourable outcome for Northern Ireland" despite the close of the UK's Renewables Obligation to onshore wind from 1 April 2016. However, the UK government has since tabled legislation that could be used to "protect GB consumers" from having to support the cost of subsidies for onshore wind in Northern Ireland that does not meet the eligibility criteria, he said.

"[The Department of Energy and Climate Change] has confirmed that it intends to exercise this power only if NI does not close the NIRO on equivalent terms to GB or ensure that any additional support is funded by Northern Ireland," Bell said in the consultation response.

"It is DECC's position that if NI wishes to support onshore wind projects that do not meet the eligibility criteria that are equivalent to those being proposed in GB, it is for NI to cover the costs of these projects," he said.

"Although the minister sought to secure a more favourable outcome for Northern Ireland, this has not been achieved," said energy law expert Laura Donnelly of Pinsent Masons, the law firm behind Out-Law.com.

"DECC has been very clear that where there is not an equivalent approach to GB closure, it is for NI to cover the costs. Indeed, that has now been hardcoded by way of a power in the Energy Bill making its way through parliament in GB. While the minister has decided to consult further on the closure arrangements for small-scale onshore wind and it will remain open for the time being, it is difficult to see any other outcome unless NI is prepared to pay the bill," she said.

In order to qualify for the grace period provisions, planned projects had to have had the relevant planning permission, a grid connection offer and acceptance and evidence of land rights as of the relevant eligibility date. For non-cluster connected projects, the eligibility date is the date of DETI's original consultation, 30 September 2015. Cluster-connected projects were able to take advantage of a slight extension, until 30 October 2015, as no equivalent policy exists on the UK mainland.

The NIRO is due to close to technologies other than onshore wind on 31 March 2017. A decision has not yet been taken on whether Northern Ireland will than transition to a new, more competitive system of contracts for difference (CfDs) for renewable energy generation in line with the UK mainland.