Debate contribution: Greenhouse Gas Emissions Trading Scheme (Amendment) (Extension to Maritime Activities) Order 2026

Debate contribution by Miss Michelle McIlveen on 10 March 2026.

MLA

Miss Michelle McIlveen

Party at the time

Democratic Unionist Party

Date

10 March 2026

Type

Debate contribution

Business

Executive Committee Business

Heading

Greenhouse Gas Emissions Trading Scheme (Amendment) (Extension to Maritime Activities) Order 2026

Assembly identifier

Official Report component 5436226

Read the official Assembly record

Text

There is much talk in the media and other places, including from Members, about the lack of legislation coming through the Chamber. No focus is placed on or thought given to the hours of scrutiny in Committees weekly, and in particular to the importance of statutory instruments. Delegated legislation that brings the provisions of Acts into force, and that creates detailed laws and orders, essentially puts flesh on the bones of primary legislation. This is the devil in the detail — the legislation that changes citizens' lives. Scrutiny of SIs, or the lack thereof, has been a bugbear of mine. Until this year, there was no mechanism for Committees to formally seek views outside what was presented by the relevant Departments.

Having that ability in relation to this Order has been enlightening. As the Chair has outlined, having heard from the Department on 19 February, when all parties bar Alliance raised concerns, we agreed to hear from Stena and the UK Chamber of Shipping. Last Thursday, we heard an incredibly detailed and considered presentation from both organisations. So convincing were their arguments that the United Kingdom Government (UKG) clearly believed that the Committee was going to oppose the Order.

What happened was, frankly, disgraceful. Last-minute pressure was placed on parties by UKG. A new dimension associated with CBAM and impact on EU negotiations was introduced. No facts, detail or proper briefing, just smoke and mirrors. That is not the way that we should do our politics, and interference at such a late stage is highly suspicious. What is interesting about all this is the fact that Sinn Féin and the SDLP folded under a threat from the British Government. Setting the process aside, let us look at the proposed extension of the UK emissions trading scheme to maritime transport and the significant concerns that it raises for Northern Ireland. It is clear from our discussions that the maritime sector supports decarbonisation and is already investing heavily in cleaner vessels and technologies. It is a sector that works on small margins, so managing time and fuel is essential. However, in its current form, the proposal risks imposing additional costs on trade between Northern Ireland and Great Britain without delivering meaningful emission reductions. Given Northern Ireland's structural reliance on maritime transport, the policy will disproportionately affect local businesses and households.

I agree with the Member's comments, and that was clear in our considerations. At a time when cost-of-living pressures remain severe, it is reasonable for us to ask whether the proposal is properly designed, adequately evidenced or sufficiently adapted to Northern Ireland's circumstances. In practical terms, the scheme risks functioning less as a decarbonisation mechanism and more as a tax on trade across the Irish Sea. Why does this matter so much to Northern Ireland? It matters because Northern Ireland is uniquely dependent on maritime connectivity. As the Chair said, around 90% of goods entering or leaving Northern Ireland move by sea. For many businesses trading with Great Britain, ferry services are not just one option among several; they are the only route to market.

I thank the Member for his intervention. Those routes underpin agri-food exports and chilled supply chains; manufacturing inputs and just-in-time logistics; supermarket and retail distribution; construction supply chains; and tourism and passenger connectivity. As a result, any increase in maritime operating costs flows directly through the entire Northern Ireland economy. Initial estimates suggest that ETS compliance could increase freight costs by around £15 per trailer, equivalent to roughly a 6% increase in average freight costs. Those costs will not simply remain with shipping operators. They will ultimately be passed on via higher export costs for Northern Ireland businesses, including our haulage firms, increased supply chain costs and higher prices for consumers. DAERA has downplayed those costs. However, the MLAs who are concerned about household budgets — we hear daily about food prices and economic competitiveness — should be concerned about freight costs too. We hear calls from the parties opposite for intervention on the soaring price of fuel at the pumps and the rocketing cost of home heating oil. The Treasury Minister is meeting MPs to explore further action about the unique challenges facing households that use heating oil, but what about the unique circumstances facing Northern Ireland in respect of the Order? In this instance, it seems to be perfectly acceptable to add a further tax from July this year to our customers. The question is whether the specific policy will drive decarbonisation or simply add costs without enabling change. At present, alternative fuels remain extremely limited and cost up to four times more than conventional maritime fuel, and shoreside electricity infrastructure is largely unavailable across UK ports. This will require considerable investment. Yet, despite the additional revenue being proposed, there is no guaranteed mechanism to reinvest ETS revenues into maritime transition infrastructure. Without those enabling measures, the policy risks raising costs without reducing emissions. As Daniel McCrossan noted during the Committee's discussion on Thursday, it risks putting the cart before the horse. On a specific economic impact assessment to look at the GB-NI route, DAERA officials have suggested that the impact on Northern Ireland has already been assessed. However, the available evidence raises significant questions. The Frontier Economics study that is often cited was commissioned in 2023 by Whitehall Departments, not DAERA, and does not take into account many of the current market developments. It mentions Northern Ireland only six times and provides no quantified estimates of the impacts on Northern Ireland's consumers or businesses. It also uses examples such as cruise shipping rather than analysing the full implications for NI-GB freight routes. While the UK Government's analysis acknowledges that Northern Ireland is more exposed to cost transmission through maritime freight, it does not quantify the real economic consequences for Northern Ireland households or businesses. That raises a reasonable question: why has no dedicated Northern Ireland economic impact assessment been commissioned for a policy with such obvious regional implications? Officials have also suggested that, if Northern Ireland does not adopt the ETS maritime extension, the costs arising from the CBAM could be higher, but there are problems with that argument. First, CBAM is not contained in the statutory instrument and does not apply directly to shipping; secondly, there is clearly no quantified estimate of CBAM costs for Northern Ireland; thirdly, Northern Ireland operates in a complex regulatory environment; and finally, if ETS-CBAM alignment becomes relevant in the future, that does not mean that the current policy design is correct. What evidence supports the claim that CBAM costs would exceed ETS costs? What modelling has been undertaken specifically for Northern Ireland? What would UK CBAM costs be in any scenario? Without transparent evidence, the CBAM argument remains an assertion rather than a demonstrated fact. We now turn to the Scottish exemption. The UK Government have already recognised that some maritime routes face disproportionate impacts. That is why the Scottish island communities have rightly received exemptions. No wonder Scotland voted for this: it is protected through those exemptions. Their existence demonstrates that flexibility is possible within the policy framework. It is not unreasonable to ask why a similar case was not advanced for Northern Ireland, given its complete reliance on maritime transport. Northern Ireland's circumstances, I argue, make it even more structurally dependent on ferry connectivity than many places served by Scottish routes. The Minister referenced the fact that other regions have supported this, but we know that Scotland has an exemption, that Wales has no domestic ferries and that Labour has a majority in the Commons. Why would they object? We are aware that this is under review by the EU, as member states already affected are unhappy. We are also aware that the rules of the game will be changed again when the Order is reviewed in 2028. At that point, the tonnage is likely to be changed to incorporate ferries over 400 tons, which will include one of the Strangford ferries. What will that mean for DFI and for the passengers who use it daily? What other changes will come about as a result of the impending review? Despite the uncertainty surrounding the proposal, we have limited options under Assembly procedure. A statutory instrument cannot be amended; Members can either approve it or reject it. However, given that serious concerns remain about economic impact, policy design, evidence gaps and regional fairness, there is a strong argument that the Assembly should ask Westminster to reconsider the proposal. It is my understanding that Ministers in Westminster are openly discussing a new statutory instrument that would address our concerns. Stena and the UK Chamber of Shipping have asked for reasonable adjustments: a 12-month delay to allow them to prepare; a Northern Ireland-specific economic assessment; a phased introduction period; and the targeting of ETS revenues towards maritime decarbonisation. If we are unhappy with the lack of an exemption for Northern Ireland that is similar to that for Scotland, if there are concerns about the economic impact on Northern Ireland consumers, if we are unclear about the CBAM argument, if there are clear competitiveness concerns and if there is no clear decarbonisation pathway in place, is it responsible to proceed? Is it more prudent to ask Westminster to come back with a revised proposal that properly reflects Northern Ireland's economic realities and amends the legislation to take account of our reasonable concerns? If the answer to all of that is yes, that should be reflected in how we vote today. There is no reason why the legislation cannot be amended so that Northern Ireland is treated in exactly the same way as Scotland; it just requires the will of the Assembly.

1,612 words. Text as published by the Northern Ireland Assembly.

Assessment

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Assessed 21 October 2026 at 15:11 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

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