Environment Committee Office
Room 245
Parliament Buildings
Stormont
BT4 3XX
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Email doecommittee@niassembly.gov.uk

Ms Lucia Wilson
Clerk to the Committee for Enterprise, Trade and Investment
Northern Ireland Assembly
Parliament Buildings
Stormont
Belfast
BT4 3XX

21 October 2008

Response to the Sustainability the Regulator’s Role Consultation from the Committee for the Environment

1. The Committee for the Environment first considered this consultation from the Northern Ireland Authority for Utility Regulation (NIAUR) on 8 May 2008 and requested some research and a synopsis of responses to the consultation.
2. Following consideration of these documents, and discussion at its meetings on 2 October and 9 October 2008, the Committee makes the following response to the request for views on the NIAUR’s sustainability consultation.
3. The Environment Committee considers that there is both need and potential for the Northern Ireland Authority for Utility Regulation (the Regulator) to do more in relation to sustainability. Northern Ireland’s ecological footprint is higher than any other region in the UK and is heavily reliant on fossil fuels.
4. The Regulator has indicated it can contribute to the sustainable development of Northern Ireland’s utilities in three main ways; gathering and publishing evidence, contributing to wider energy policy and regulating differently. Each of these ways has the potential to contribute to and play a significant role in the protection of the environment.
5. Gathering and publishing evidence could play a significant role in helping consumers to make better informed choices regarding their choice of fuel and the efficiency of their use of water and energy.
6. Providing strategic guidance into the development of energy policy could ensure that appropriate incentives are in place to influence fuel choice, such as renewable energy, and encourage more efficient use of water, electricity and gas. However, the Committee notes t hat any polic ies on sustainability formulated by the Regulator should be reflective of the appropriate Ministerial guidance.
7. The Regulator indicates they should regulate in a way that recognises the need to spread energy and water costs equitably between current and future consumers. From an environmental perspective it is important that the price paid by today’s consumers does not ignore the demands that tomorrow’s consumers will face as a result of the price and availability of fossil fuels and the impacts of climate change. Requiring the cost of carbon to be incorporated into business cases might be a useful way to achieve this.
8. In summary the Environment Committee concludes that the Regulator has a responsibility to address sustainability through appropriate regulation and has the tools available to do it. However in the current economic climate there is a need for balance. All decisions regarding water, electricity and gas services must be taken in the context of social and economic factors including economic competitiveness, vulnerable customers, security and quality of supply, the cost of carbon and the potential future price and availability of carbon fuels.

Yours Sincerely

Alex McGarel
Clerk to the Committee for the Environment