Diolch, Presiding Officer. Last December, I set out my priorities in relation to energy. And, today, I want to focus on accelerating the transition of the energy system in Wales, particularly through the increased deployment of renewable energy.

Our energy system has undergone dramatic changes in recent years, and there is further transformational change to come. The Paris agreement is gaining momentum and, with it, a clear commitment to decarbonise economies and energy systems across the globe. Wales must compete in global low-carbon markets, particularly now we face a future outside the EU, and the UK Government is aiming to phase out unabated coal by 2025.

The ability to meet our needs from clean energy is, therefore, part of the foundation for delivering the future set out in our new national strategy, ‘Prosperity for All’. In parallel with the need to decarbonise, the economic case for renewables continues to strengthen, with increased deployment of renewables lowering costs, as confirmed by the recent contracts for difference auction. We’ve seen significant progress in Wales, with the Government in 2005 setting a target of generating 7 TWh of renewable energy every year by 2020.

The UK Committee on Climate Change reported earlier this year that we are on track to deliver this ambitious target. Electricity generation from renewables in Wales has trebled since 2010. Two projects that have recently become operational help to symbolise the change taking place. Pen y Cymoedd wind farm, which the First Minister will be opening later this week, is the largest onshore wind project in England and Wales. Vattenfall has supported and created more 1,000 jobs in Wales and the project delivers £1.8 million annually into a community benefit fund. On a much smaller, community scale, we have Awel Aman Tawe’s wind development. It is wholly community owned, meaning all its profits are kept within the Aman valley and their shareholders.

We need many more such projects at all scales and technologies to transform our energy system, play our part in tackling climate change, deliver benefits for Wales and address likely increases in electricity needs as we use more electricity for transport and heating. Other low-carbon energy sources will also be important, with Wylfa Newydd representing the largest private sector investment in Wales in a generation.

The UK Government has a critical role to play in keeping this momentum going. However, I am determined to drive change using the levers we have here in Wales. This is why I am today announcing targets to focus action across Wales and capture the benefits for Wales. We have worked with expert organisations to pull together a solid and robust evidence base. We held a successful event in July, involving experts as well as those with an interest in the issue to help inform our thinking.

Firstly, I’m setting a target of Wales generating 70 per cent of its electricity consumption from renewable energy by 2030. The latest data show that, in 2015, we generated 32 per cent of electricity consumption in Wales from renewable energy. Secondly, I am setting a target for 1 GW of renewable electricity capacity in Wales to be locally owned by 2030. In 2014, 330 MW of renewable electricity capacity in Wales was locally owned.

Finally, by 2020, I expect new renewable energy projects to have at least an element of local ownership. I will be issuing a call for evidence on the issue, however my expectation is for new projects to involve local people and provide benefits to Wales, as well as to external shareholders. I believe these are stretching but realistic targets that will help us to decarbonise our energy system, reduce long-term costs and deliver greater benefits to Wales. I am clear we need to take action to support delivery of these targets.

Firstly, in this increasingly complex world, we need to provide more direction on certain aspects of our energy policy, particularly for those making difficult decisions in planning and permitting. I will be considering the need for energy alongside the other ways we use land. This will have implications across my portfolio for how we manage our natural resources.

We’ve already seen some excellent work with local ownership. I’ve agreed core funding for Community Energy Wales to enable them to work with developers on behalf of communities in Wales, looking at how we secure greater local involvement from the design stage onwards. I will also be focusing on heat. Though the 70 per cent target does not include heat, the potential future impact of electrifying heat is significant for both demand and supply elements of the target. The UK Committee on Climate Change has recommended we provide clearer policy on heat for Wales and I will be taking this forward.

Secondly, we will work collectively to ensure our grid infrastructure enables a low-carbon model of electricity generation. The electricity and gas grid we need for the future will look very different to what we have now. The right flexible and affordable grid infrastructure is a fundamental enabler to connect the new generation that Wales needs for a prosperous low-carbon future. I will be working closely with the regulator, electricity grid operators, academics, innovators and developers to identify cost-effective ways of ensuring we have a fit-for-purpose grid.

Thirdly, the targets I am announcing today have implications for our planning system. We have made significant progress in ensuring we have a streamlined yet robust planning system in place, for example by establishing the development of a national significance regime. I will shortly be consulting on amending permitted development rights for rooftop solar and small-scale, low-risk hydro projects. Alongside this, we’re working on the national development framework, which will be an all-Wales development plan and will reflect the policies of the Welsh Government.

Furthermore, we will keep our national planning policy under review so that it continues to support delivery of our energy ambitions. I will be shortly consulting on the national marine plan, which will set the context for the offshore renewable sector. I’m also looking to the UK Government to deliver on areas that are not devolved to Wales. The UK has invested over £9 billion in developing the renewables sector. Costs have successfully been driven down, however the rapid changes of UK Government policy have decimated large parts of the renewable sector, with developments potentially valuable to Wales stopped in their tracks by UK Ministers.

The bulk of UK Government renewables investment is now going to offshore wind projects outside Wales. This investment is paid for by Welsh bill payers, amongst others. There is a need for the bulk of energy supply to come from the most affordable technologies if the costs are to be found from energy bills. These technologies therefore need a route to market if we are to meet our ambitious targets and deliver the most benefit to Welsh bill payers. That is why I have called repeatedly on UK Government to stop the ideological exclusion of onshore wind and solar from the CFD process. This is not simply a Welsh Government view. I am working with some of my Brexit ministerial round table participants to build a real and balanced consensus on what will best meet Wales’s needs.

It is also important to support emerging and innovative technologies such as wave and tidal, which the current CFD auction rounds singularly fail to do. Recent evidence of the falling costs of offshore wind demonstrate what similar support could do for other emerging sectors. Welsh Government is doing its share. We’ve made around one hundred million €100m of EU structural funds available for investment in marine energy. The SPECIFIC initiative is taking ideas from thoughts through to market-ready technologies: leading-edge work based here in Wales.

However, we do not have either the levers or the funds to do everything. We do need a mature debate in the UK about how to structure both support for research, development and innovation, bringing forward to market the technologies of the future at the same time as we ensure the bulk of our energy needs are delivered from affordable, low-carbon sources.

We are already capturing value from energy development in Wales. Welsh Government is a statutory consultee in the planning process for the Wylfa Newydd project and we are working with UK Government and Horizon Nuclear Power to ensure the developing plans work for Wales and that this multibillion pound project provides a positive and lasting legacy to Wales.

On Swansea bay tidal lagoon, we continue to press the UK Government for clarity on support and a response to the Hendry review. I will continue to build on the co-ordinated and coherent direction that I set out last December and will provide a further update on other aspects of that statement, including a focus on energy efficiency, in December this year. Our key priority remains to deliver a prosperous and secure, low-carbon Wales.