RP7 Stakeholder Consultation WEB - Flipbook - Page 56
To counter the upward pressures
this might place on network charges,
we always work hard to temper any
potential price increases by focussing
continually on operating as efficiently
as possible. For example, we will be
smart and efficient in how we plan our
investment programmes, seeking out
all opportunities to add extra capacity
required for the future as we replace,
refurbish or maintain parts of the
network in need of attention. We will
also seek to finance our business as
efficiently as possible and together
with the Utility Regulator, we will
explore how we can spread the cost of
these investments in the most fair and
appropriate manner between customers
today and customers of the future.
Another factor which we need
to be aware of is that we expect
transformational changes in society
such as the electrification of transport
and heating, to lead to greater electricity
consumption in future compared to
today, which will help spread the costs
more widely. We are estimating that
the volume of electricity transported
across our network will on average be
around 10 per cent higher during RP7
compared to average levels in RP6 as
electricity displaces fossil fuel usage.
This will put downward pressure on
average network charges such that we
estimate we can deliver the increased
levels of investment during RP7 whilst
keeping distribution network unit
charges in line with those of RP6 in real
terms.
end up paying more for their electricity
as they consume more, they will not
have to pay for home heating oil if their
homes are heated with a heat pump or
for petrol and diesel for their cars if they
drive an EV. We are currently working
with economic advisers to assess the
impact of these off-setting cost savings,
and how we can facilitate customers
realising any such savings in future. The
findings will be available soon and will
feature as part of our final proposals for
RP7 which are due for submission to
the Utility Regulator in March next year.
In addition, the wholesale cost of
electricity should be less driven by
movements in the price of fossil fuels,
if and when there is more renewable
generation on the system increasing
our self-sufficiency with less reliance
on imported fossil fuels to generate
electricity. For example, consultants
at KPMG have estimated that
electrification of heating and transport
would displace £1.4 billion of annual
expenditure on imported fossil fuels by
204015.
In addition, KPMG concluded that the
capital investment needed to electrify
society would have other indirect
benefits, leading to an estimated
total Gross Value Added of £18.8
billion. The employment created from
the capital investment programme
is significant, forecasted to reach
up to 5,000 full-time jobs over the
investment period.
The displacement of fossil fuel usage
is important as, while customers may
Q25. In this context, we would welcome stakeholder feedback on our
analysis of the monetary impact of our proposals and the benefits it will
bring to our customers and wider society.
Figure 15 – Potential benefits
from greater electrification in
Northern Ireland
Create Jobs
Create at least 5,000
direct jobs
Reduction in GHGs
Supports delivery of 82%
by 2050 helping to reduce
800 deaths per year due to
air pollution
Displace Imported
Fossil Fuels
£1.4bn pa for local
economy by 2040
Investment Opportunity
£9.6bn over two decades
inc £600m for electrification
of transport and £1.7bn
in the electricity network
infrastructure
Economic Growth
Leads to £18.8bn GVA
15
“Electrification: Economic Opportunity for Northern Ireland”, July 2021. Available at –
https://www.nienetworks.co.uk/documents/future-networks/210903_nie-electrification_vprint.aspx
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Northern Ireland Electricty Networks
