The return of the Stormont Executive has been very widely welcomed. It faces a daunting task trying to restore services in Northern Ireland and undertaking many long-awaited reforms. One policy area that needs action, though not currently top of the agenda, is the all-island electricity market.
In the Belfast Agreement, all parties understood it was wise to omit electricity from the range of all-island bodies. Any development of an integrated electricity system was to be driven solely by potential commercial and environmental benefits.
In the early 2000s, the Northern Ireland Authority for Energy Regulation, of which I was a member, and the Irish Commission for Energy Regulation, began negotiations to develop an integrated electricity market on the island. As governments were not directly involved, it was not seen to be problematic from a unionist point of view.
Research had shown that an integrated electricity market would result in significant cost savings for consumers, both north and south of the Border; it would reduce greenhouse gas emissions on the island; and it would enhance energy security, especially in Northern Ireland. The resulting single electricity market took effect in 2007.
The existing wires linking the two systems were much too weak to deliver the expected advantages. It was agreed that to reap the benefits of an integrated system would require much stronger cables connecting the North and the South.
The engineering solution needed is a 400kv alternating current (AC) interconnector. Across Europe, electricity supply alternates between positive and negative polarity exactly 50 times a second. Any variation in the frequency would be disastrous, so to keep the northern and southern systems in lockstep, an AC interconnector is essential. To carry adequate power, it needs to be 400kv.
At least three independent groups have examined the need for the interconnector and its design. I was a member of one of these groups, chaired by retired Supreme Court judge Catherine McGuinness. All concluded that the new wires have to be overground. This is not because of economics, but because of physics. If it were underground, extreme pressures would build up in the wire (capacitance), leading to risk of power losses. Local opposition to overground pylons helps explain the reluctance to build the essential interconnector.
Some Northerners may see a problem in the ownership and management of the electricity grid in the North by two State companies from the Republic, the ESB and EirGrid
In the years after the all-island electricity market was agreed, I felt let down by the lackadaisical approach of Irish governments to delivering the necessary interconnector. It took almost a decade to get agreement and permits south of the Border to proceed. However, in recent years, responsibility for the continuing failure to build the interconnector lies on the northern side.
There seems to have been some disenchantment in Northern circles with the idea of an all-island market for electricity. In the absence of an interconnector to make integrated transmission a reality, the expected benefits have not yet appeared, which probably accounts for much of the disillusionment. However, some Northerners may see a problem in the ownership and management of the electricity grid in the North by two State companies from the Republic, the ESB and EirGrid.
Conor Murphy of Sinn Féin is the new Northern Ireland minister for the electricity system. He has the responsibility for implementing the interconnector, to deliver the economic and environmental benefits of an all-island system for coming generations, and enhance security of supply. Without that interconnector, a repartitioning of the electricity system could be possible at some date in the future.
Post-Brexit, the all-island market remains part of the European Union electricity system. As a result, electricity generation companies in the North have to buy EU emissions trading permits, not UK permits. In turn, the revenue from the permit sales is returned to the people of Northern Ireland by the EU.
The EU electricity market currently has some design flaws. If the all-island electricity system is to continue, there will be shared interest across the island in how that EU market is redesigned. It will be essential that any revised EU market structure accommodates the high level of renewable generation this windy island can produce.
Given the single electricity market is part of the EU system, the North is entitled to have its voice heard by the EU. That’s probably easier to put in train when the Minister involved is not from the DUP. While London may be unhappy about it, minister Conor Murphy should approach Brussels directly on this issue, in co-ordination with his southern counterpart, Eamon Ryan. It would be a practical example of co-operation on the shared island.
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