Department for the Economy Board minutes 2024 - 27 November 2024

John Healy, Chair of Invest NI, presented:

• He has been in post almost 9 months and previously worked in Allstate and Citi group.
• Invest NI is charged with the economic development of NI.
• The Lyons report called for change of leadership with Kieran Donaghue being appointed Chief Exec. Kieran put together a governance model and appropriate committees. Invest NI and DfE worked on action planning. There were 35 actions co-designed and co-owned re what needed to change. 28 of these actions will be completed by the end of 2024. Appropriate levels of communication are now in place between Invest NI and DfE. We need to put the Lyons report behind us and say what we have delivered from it.
• He praised the talent of the Invest NI Board and the work done by Interim Chair Colm McKenna.
• The Board has been very active and are now into delivery.
• The Invest NI Business Strategy was launched last week, all fully endorsed by the Invest NI Board. It landed well with clients, employee base and external stakeholders.
• We will know how successful Invest NI is through hard numbers published in the strategy. We should be able to tick all boxes in 3 years. It will need continued push from their Board to hold the Executive Team to account for delivery.
• The Board recently went away for a day to focus on transition from strategy to delivery.
• The most important action is the change in the leadership team who need to be fully bought into strategy. Kieran will be hiring leaders for 3 roles and business continuity will be a risk until these are filled.
• There will be a focus on the people and culture agenda.
• Invest NI are aligned with the policy objectives of DfE.
• The job is not done, just at the end of the beginning.

Minutes of the October meeting were approved without amendment. Action points from the October meeting: -

1.Proposed date for Skills Action Plan to be confirmed – this has moved from September 2024 to January 2025.

2.The content of the Contracts Register report has been revised with a view to providing greater insights into how particular contracts are progressing.

Jimmy Graham presented:

• The Climate Change Act (NI) 2022 Section 15 requires that DfE must ensure that at least 80% of electricity consumption is from renewable sources by 2030. This is only 60 months away. This sets a very high threshold for DfE to meet. We don’t have a role in planning, building infrastructure or building generation. We will know by the end of Minister’s mandate if this is achievable.
• A positive development is that the Executive has agreed carbon budgets.
• Consumption and generation measurement is undertaken by NISRA and is being reviewed.
• We have been successful in our renewable journey to date with the 2020 target being exceeded by a year.
• Renewable generation needs to grow by 2.5 times by 2030. The bulk of this will come through the support scheme with 2 auctions to be held – for 970GWh and 3,500GWh. The auctions will be through Contracts for Difference, commonly used in many countries. These protect developers from volatile wholesale prices and consumers when wholesale prices are high. DfE will set a ‘strike price’. They are fixed mostly over a 15-year period.
• A support scheme will encourage powering of existing sites and bringing more efficient larger technology. It will encourage a wide range of renewable sources to diversify the technology mix to support security of supply. A consultation was published early 2023 and a high-level design went out in April 2024. Jimmy discussed the target timeline. We want DfE to be responsible for pre-allocation, SONI for Auction Operation and the Low Carbon Contracts Company to be responsible for Contract Management – all under negotiation. The Utility Regulator’s role is with monitoring, compliance and appeals. The support scheme cost will be socialised but has the potential to bring £2.9bn investment to NI.
• A review of the Single Electricity Market has been recommended and we have been in touch with the Regulatory Authorities to kick this off.
• There is a huge untapped resource in forestry with an opportunity in terms of space with a potential of 400MW. DAERA are engaged with this. This could come through for the 2^nd auction.
• Jimmy shared the governance structure within DECC which is larger than that currently in DfE.

Sarah Brady presented:

• Getting a support scheme in place and investment alone will not meet the 2030 target. We need capacity.
• We want to be able to export electricity when needed.
• We will have more integration.
• NIE will invest around £2.3bn in grid maintenance and development for 2025-2031.
• NI is on track to build our portion of the N/S interconnector by 2028.
• DfE is developing storage and interconnection policy.
• DfE, UR, SONI and NIE are developing flexibility and digitalization plans.
• DfE is developing policy which will grow demand from new forms of low carbon heating and (with DfI) transport.
• We have a proposal for the LirlC interconnector.
• We have a consultation paper out on smart metering.
• Electricity must move from low price areas to high price areas under European rules.
• Consumption will increase with electric vehicles and heat pumps, though it has decreased.
• Resource is required to progress policies and consultants have worked on the requirements.