Northern Ireland’s Fourth Carbon Budget is a blueprint for how we will power our economy, cut emissions, and deliver on net zero by 2050. In this Policy Unpacked post, Madeleine Clarke breaks down what’s at stake: from tripling renewable electricity capacity to removing planning barriers and passing critical legislation like the Renewable Electricity Price Guarantee. Discover why decisive action now will shape Northern Ireland’s energy future, unlock billions in economic opportunity, and position us as a leader in clean power innovation.
What is the Fourth Carbon Budget?
Under the Climate Change (Northern Ireland) Act 2022, Northern Ireland is required to set out five yearly carbon budgets (a cap on the amount of greenhouse gas emissions during each five-year period).
The Fourth Carbon Budget will cover the period 2038-2042. The Department for Agriculture, the Environment, and Rural Affairs (DAERA) has proposed an annual reduction of 77 per cent in carbon emissions from the 1990 baseline during the period of the Fourth Carbon Budget, with the ultimate goal of reaching net zero emissions by 2050. This is in line with advice from the UK Climate Change Committee (CCC).
Fourth Carbon Budget consultation
The recently closed consultation on Northern Ireland’s Fourth Carbon Budget provides an opportunity for the government, industry, and communities to take a longer-term view of Northern Ireland’s journey to net zero.
This is crucial if NI is to achieve net zero carbon emissions by 2050 in a well-planned and well-executed manner. It gives clarity for all stakeholders, even as we focus on shorter term goals on a day-to-day basis. The CCC’s advice on the Fourth Carbon Budget makes clear that a clean power system will underpin much of Northern Ireland’s decarbonisation efforts, with 55 per cent of carbon emissions reductions in the budget coming from the transition to clean power and the electrification of other sectors.
Renewable Electricity’s role
RenewableNI welcomes the ambition in the CCC’s report on the carbon budget. It calls for a 95 per cent reduction in emissions from the power sector from the 1990 baseline. This is set to be achieved by a tripling of renewable electricity capacity to 5.5GW by 2040, an ambitious but achievable goal.
Now the Northern Ireland government and the renewable electricity industry must work together to lay the right foundations to achieve this target.
As the CCC’s advice states, to achieve this target it will be vital to remove blocks to the expansion of renewable electricity so the NI power sector can continue its decarbonisation path.
The final scheme design for the Renewable Electricity Price Guarantee (REPG) was published in September, and the legislation for this support scheme is set to be introduced to the Assembly before the end of 2025.
It is crucial this legislation is passed as soon as possible, not just to meet the shorter term 80 per cent renewable generation by 2030 target, but the longer term target set out in the CCC’s advice on the Fourth Carbon Budget.
Barriers in the planning system which delay renewable electricity projects and the expansion of transmission and distribution infrastructure must also be resolved.
Northern Ireland will need a mix of technologies to achieve these targets. Established, mature technologies (such as onshore wind, solar, and increasingly Battery Energy Storage Systems) will need to be deployed at scale.
Offshore wind is a technology which has become well established in other places, including GB, Denmark, and China, but is new to Northern Ireland. If current timelines are kept to, the first offshore projects in NI waters will be built in the 2030s. We will also need new, innovative technologies such as hydrogen production, which the CCC mentions as a potential source of power generation. We can take advantage of these mature technologies to achieve its decarbonisation goals while having the chance to become a leader in new technologies like hydrogen production.
Heating and Transport
The CCC’s advice on the Fourth Carbon Budget states 55 per cent of all emissions reductions in the budget will be from building a clean power sector and electrifying other sectors such as transport, heating, and industry. This makes transitioning to a renewable electricity system vital not just for decarbonising the power sector, but also for decarbonising other sectors of the Northern Ireland economy. An expansion of renewable electricity generation will underpin Northern Ireland’s journey to net zero.
Economic Impacts
When seeing these ambitious renewable electricity targets, it might be tempting to only think of the costs involved in building wind, solar, and grid projects. However, the expansion of renewable electricity represents a huge and exciting economic opportunity for the region.
2,500MW of onshore wind by 2030 could generate £145 million in Gross Value Added (GVA) and support around 1,350 jobs. Continued investment in onshore wind beyond 2030 can be expected to reap continued rewards in the creation of green jobs and economic growth.
Renewable electricity provides a stable revenue stream for local authorities (projected to total £25 million by 2030).
The development of the offshore wind industry provides a substantial long-term economic opportunity as well, with Baringa’s The Clean Revolution report stating that a successful offshore wind sector could deliver up to £2.4 billion in GVA and £1.9 billion in local supply chain spending.
Social Impacts
Transitioning to a renewable electricity system can provide significant positive social impacts through supporting community benefit funds, reducing fuel poverty through greater energy efficiency and electrification, and through providing jobs and economic opportunity for young people in Northern Ireland. It will be important for the renewable electricity industry to engage with communities, to ensure these positive impacts are felt by people and to bring people with us on the journey towards net zero carbon emissions.
Carbon budget future
The Fourth Carbon Budget sets out a clear pathway, but ambition alone will not deliver results – policy must lead the way. Passing the Renewable Electricity Price Guarantee legislation without delay, streamlining planning processes, and accelerating grid investment are critical steps that cannot be deferred. These measures will unlock the renewable capacity Northern Ireland needs, ensuring that targets are not just aspirational but achievable. By acting decisively now, policymakers can provide the certainty investors require, remove systemic barriers, and position Northern Ireland as a leader in clean energy policy across these islands.
