Development of the Northern Ireland gas industry
There are three gas distribution network areas in Northern Ireland that are operated by their respective network operators: Phoenix Energy, Firmus Energy and SGN Natural Gas. As at March 2023, there are approximately 316,000 gas connections in Northern Ireland across the three network areas. Further information on each of the network areas is provided below.
Natural gas was first introduced to Northern Ireland via the Scotland to Northern Ireland gas pipeline in 1996. Initially, natural gas was made available to customers in Greater Belfast, the immediate surrounding area and Larne where the gas distribution network has been developed by Phoenix Natural Gas, now renamed ‘Phoenix Energy’. Phoenix Energy continues to connect customers to its network within the Greater Belfast network and by the end of March 2023, 247,4451 customers had been connected to natural gas in this licence area.
Firmus Energy obtained a licence from the Utility Regulator in March 2005 to develop the natural gas market in the "Ten Towns" licence area outside Greater Belfast along the routes of the North-West gas transmission pipeline (completed November 2004) and the South-North gas transmission pipeline (completed October 2006).
This work has involved rolling out the gas distribution network to towns and cities in the North-West and to the Ballymena, Antrim, Banbridge, Craigavon, Portadown, Armagh and Newry areas. By the end of March 2023, Firmus Energy had connected 66,077 customers in this licence area and taken natural gas to some 20 additional urban areas, including Tandragee, Warrenpoint, Bushmills, Richhill, and Moy.
Gas to the West
In February 2015, the Utility Regulator awarded exclusive gas conveyance licences to West Transmission Ltd (part of the Mutual Energy Group) and SGN Natural Gas to provide new infrastructure to connect eight further towns in the West to natural gas. The major infrastructure within this £250 million project was completed in 2019 with some £30 million contributed by the NI Executive. This has brought natural gas as a lower carbon fuel to Dungannon, Coalisland, Cookstown, Magherafelt, Omagh, Enniskillen, Derrylin and Strabane. The new gas networks in the West are expected to serve some 40,000 businesses and households, with 3,439 consumers connected to date.
Gas to East Down
In December 2015, the Utility Regulator approved an extension to the Phoenix Natural Gas licence to provide new gas infrastructure to 13 towns and villages in East Down, including Annahilt, Ballygowan, Ballynahinch, Castlewellan, Crossgar, Downpatrick, Dromore, Drumaness, Dundrum, Hillsborough, Newcastle, Saintfield and The Spa.
Phoenix’s £60m core build in East Down, together with an extension of the gas network to Whitehead, is now complete. Gas is available to around 24,100 properties across these areas with around 3,900 new customers connected.
1 These figures have been taken from the Utility Regulator’s Retail Market Monitoring Quarterly Transparency Report, Quarter 1: 01 January to 31 March 2023 published on 15 June 2023.
Path to Net Zero Energy
The energy strategy for Northern Ireland “The Path to Net Zero Energy”, published on 16 December 2021, recognises natural gas as a transition fuel on the pathway to net zero carbon.
Currently, almost two out of every three homes in Northern Ireland are still heated by oil. Converting to natural gas from heating oil reduces greenhouse gas emissions by around 30 per cent with potential savings up to 50 per cent in certain conditions, such as moving from an older oil boiler to a more efficient modern gas boiler. However, the Strategy recognises that gas decarbonisation must be achieved in order to address climate change issues.
The Utility Regulator has been leading a programme of work with the department, the gas industry and the Health and Safety Executive to consider the range of issues which will facilitate injection of biomethane, a net zero carbon renewable gas, into existing gas networks. Given Northern Ireland’s strong agricultural and agri-food base, there is considerable potential for locally-produced biomethane. Gas networks also offer potential for the future injection of hydrogen to help deliver decarbonisation of the heat sector.
There are currently proposals to develop an underground storage facility below Larne Lough in East Antrim. The Department of Agriculture, Environment and Rural Affairs (DAERA) awarded the project a draft marine licence and associated consents in December 2021- (DAERA website - Marine Licence ML 28_12 Islandmagee Gas Storage Project).
The department is continuing to work closely with the Utility Regulator and the natural gas industry on gas market arrangements and ensuring that energy policy and legislative requirements are delivered in Northern Ireland.
There is also significant liaison with the Department for Energy Security and Net Zero (DESNZ) in London, and contact with the Department of the Environment, Climate and Communications (DECC) in Dublin, in relation to a range of gas market issues, including security of supply.
The Department for the Economy also continues to engage with other Northern Ireland departments, including DAERA and other stakeholders, in relation to actions in support of decarbonisation of the gas network.
The overall legislative framework for the natural gas industry in Northern Ireland is provided through primary legislation in the Gas (Northern Ireland) Order 1996 and the Energy (Northern Ireland) Order 2003, which have been significantly amended in compliance with EU legislation and, more recently, to take account of EU exit. There are also primary legislation provisions for gas under the Energy Act (Northern Ireland) 2011.
The department also makes subordinate legislation under powers provided within the primary legislation for gas and this has included several Gas (Designation of Pipelines) Orders, the Gas (Applications for Licences and Extensions Regulations (NI) 1996, the Gas (Supplier of Last Resort) Regulations (NI) 2009 and the Gas (Individual Standards of Performance) Regulations (NI) 2014.
All of the above and other gas-related legislation is published on Legislation GOV.UK.
Natural gas licences
Gas licences (conveyance, storage and supply of natural gas) are granted by the Utility Regulator under Article 8 of the Gas (Northern Ireland) Order 1996.
Information on the procedures governing applications for the granting of natural gas licences can be accessed at the Utility Regulator website at Gas Licences.
The procedures governing the grant by the Department of necessary (or compulsory) wayleaves for the installation or retention of gas pipelines are contained in paragraphs 10-12 of Schedule 3 to the Gas (Northern Ireland) Order 1996.
For information about how the department processes any personal data in connection with gas necessary wayleave applications and gas tree cutting applications, see our privacy notice: