The Northern Ireland Executive’s proposed Renewable Energy Price Guarantee (REPG) scheme could significantly reshape the region’s energy market and its approach to renewable investment. By introducing a two-way payments system and a community benefit element, the scheme aims to stimulate investment in wind, solar, and energy storage projects, ultimately driving down electricity costs and increasing energy security.
The REPG’s auction-based model, set to begin in early 2027, will determine the price for renewable power, with the goal of securing between 750 and 1,250 gigawatt hours per year. This mechanism could introduce greater price stability and predictability for both consumers and renewable energy generators. When electricity prices fall below the agreed contract level, generators will receive payments from electricity companies, while excess payments will be collected from generators when prices rise, ultimately benefiting consumers.
The scheme’s potential to lower electricity bills and create jobs, particularly in rural areas, has been welcomed by renewable sector leaders. Tamasin Fraser, chair of RenewableNI, highlighted the economic benefits, stating that reaching the 80% renewable generation target could deliver approximately £110 million net benefit annually to consumers. Moreover, the scheme could help Northern Ireland hedge against the volatility of imported fossil fuels, as seen in the wake of the Russia-Ukraine war.
However, the success of the REPG will hinge on several factors. The final scheme design acknowledges that achieving the 2030 target depends on a sufficient pipeline of renewable projects and the development of supporting electricity infrastructure. Capacity limits in the grid have previously led to wind power being “dispatched down” to protect infrastructure, highlighting the need for grid upgrades and expansion.
To ensure the scheme’s success, RenewableNI has called for a clear and timely implementation plan, including support for tackling grid constraints, planning delays, and the lack of a policy framework. The sector has repeatedly called for support to meet climate change targets, and the REPG could provide a much-needed boost to renewable power generation, which has stagnated in recent years.
The proposed community benefit element, similar to schemes in the Republic of Ireland and Great Britain, could further enhance the scheme’s appeal by ensuring local communities benefit from the transition to net zero. This could foster greater public support for renewable energy projects and help to address any local opposition.
In the broader market context, the REPG could encourage increased investment in renewable energy projects, driving down costs and stimulating economic growth. As renewable generation increases and dependence on fossil fuels declines, electricity prices are expected to become more stable and lower. This could have positive implications for businesses and consumers alike, as well as the environment.
However, the scheme’s success will ultimately depend on its implementation and the ability to overcome existing challenges, such as grid constraints and planning delays. If the REPG can deliver on its promises, it could serve as a model for other regions seeking to boost renewable energy generation and reduce electricity costs.