The House will now hear two minute statements on matters appropriate to the Minister for Energy. I propose to call on the Deputies I have selected in the following order: Deputy Nealon and Deputy Gerry Reynolds. Each Deputy is entitled to two minutes in respect of each matter and each of the statements will be followed immediately by a two minute reply by the appropriate Minister or Minister of State. I call on Deputy Nealon to make his two minute statement.
Adjournment Debate. - Energy Matters.
Because I felt that this might be the last day Deputy Molloy would be serving as Minister for Energy I very deliberately put down this matter seeking action on a pulpwood industry for the north-west. I believe the Minister accepted the case for a further pulpwood industry and I also believe that he was sympathetic to and accepted the logic of the arguments for the location of that industry in Sligo-Leitrim. I hope I will be able to convince his successor, the Taoiseach, on the wisdom of the case, achieving agreement at last between Fianna Fáil and Progressive Democrats Ministers.
The case has been argued many times for a third pulpwood industry in addition to the mills at Clonmel and Scariff. In the north-west we are planting trees at a very rapid rate. Indeed, too much good land is being gobbled up this way, along with marginal land. Whatever one's attitude to forestry development, it is happening. Already there is plenty of raw material for a third pulpwood mill with forest thinnings and the residue from the sawmills. There will be more. Sadly there are disappointingly few jobs in forestry but there are many good, long term jobs in the pulpwood industry. Instead of exporting surplus timber as we are now doing to Finland, France, the UK and other countries, all logic seems to suggest that we proceed as quickly as possible with a new pulpwood industry. Because it is where the timber is and where the jobs are needed most, the logical place for such an industry must be Sligo or Leitrim. I hope the Minister standing in for the new Minister for Energy will be able to agree and will have some definite information on progress planned.
Speaking as a Dáil Deputy whose seat is in considerable danger, although it will be vigorously defended, I want to pay tribute to you, a Cheann Comhairle, on the manner in which you have presided over the affairs of the 26th Dáil, which was at times an unruly assembly. I offer a particular word of thanks on the manner in which you have nurtured this late hour facility for bringing to the floor of the House issues of vital local importance.
I am taking this matter on behalf of the new Minister for Energy, the Taoiseach. I congratulate the two Deputies opposite on their diligence and close marking. The other grievance matter comes from Deputy Nealon's colleague, Deputy Gerry Reynolds. I note what Deputy Nealon says about his seat being in danger. I wish both Deputies well in the election.
I agree with the Deputy that there is an urgent need for another pulpwood-using industry, in this country, to cater for the supplies of timber becoming available in increasing quantities in the country as a whole and the north-west region in particular.
Earlier this year, my predecessor indicated in this House that the increasing availability of timber supplies merited the establishment of a new pulpwood-using industry. That remains our view.
The Deputy will appreciate that the promotion of such a project is essentially a matter for Coillte, in consultation with the State's industrial development agencies. I know that Coillte and the IDA have maintained contact with all of the major companies in the industry internationally, with the aim of developing early proposals for a new pulpmill which will best utilise the growing raw material output of our forests.
I can assure the Deputy that there has been no slackening of effort in trying to find a suitable international partner to replace the Swedish industrial concern which withdrew from an earlier development project. The urgency of the situation is fully accepted. It is the reality, however, that the timber industry internationally and pulp processing in particular is going through a very deep recession and the recent turmoil on the currency markets is another unhelpful factor in efforts to get such a project off the ground. The Deputy will readily understand that such circumstances are an unfortunate backdrop to the search for a suitable international partner in this venture, but the search is continuing.
The timber supply situation is certainly in our favour and augurs well for ultimate success. Total average annual pulpwood availability over the period 1992 to 1997 is projected to be 900,000m. per annum. Besides the quest for a new pulpmill plant which is the highest priority project, Coillte is currently examining a number of other possible uses for the increasing volumes of pulpwood and sawmill residues becoming available in Ireland. These include board products such as oriented strand board and medium density fibre board. Detailed feasibility studies are still in progress.
To move such projects forward. It is necessary to secure the right investment sources with the right levels of expertise and market outlets but, as I said earlier, the search is not easy in recessionary times. As to the likely location of such industries, this would be a matter primarily for the major investor involved and it would depend on a number of factors, including electricity and adequate water supplies in the case of a pulpmill plant especially. Of course, great emphasis will also be placed on environmental considerations. While it is thus too early for me to indicate to the House the location of such new industries, I would reiterate my view that the north-west area would represent a prime potential location on the basis of the level of total national pulpwood supply projected from that region.
I thank the Minister for his kind words and wish him, too, every success in the forthcoming election.
I refer to the Arigna power station in County Roscommon. For the past year the communities in the Arigna catchment area have been plunged into a mood of darkness arising from the announcement of the closure of the ESB coal burning station and the consequent closure of the coal mines. In 1968 the power station now at Arigna was commissioned and it has since performed at a very high efficiency level within planned parameters. In 1989 it was the fifth most efficient power station in the ESB network, well above the efficiency level of even the Moneypoint power station. In over 30 years it has produced electricity at a very economic and technically efficient level. In 1989 the works cost was almost £4 million, almost £1 million less than in 1988. A total of 4.8 million units were generated and 4.23 million units were sent out into the system. What therefore was initially established primarily for social considerations has become an efficient user of national resources in the area.
The Taoiseach has taken responsibility for the Department of Energy. He represents the constituency where the Arigna power station is located. Before he turns out the lights on this Dáil I would ask him to give a commitment to the 60 people employed in the Arigna ESB station that the station will be allowed to continue in operation until all the coal in the Arigna area is exhausted.
I thank the Chair for allowing us to raise serious local issues and I hope I will be back in the 27th Dáil to meet you on opening day.
I am dealing with this matter on behalf of the Minister for Energy. Last year an independent consultancy study was commissioned on proposals put forward by the Arigna action committee for the continued operation of the Arigna power station. This action was taken to ensure that the committee's proposals were fully evaluated. Unfortunately the consultants, Byrne O'Cleirigh, concluded that they could not recommend that the operational life of the station be extended past the proposed closure date next year. This conclusion was reached by the consultants on the facts as presented to them. The consultants concluded, using the most optimistic assumptions on coal availability and its cost and on station refurbishment requirements, that the cost of generating power at Arigna is likely to be at least four times the alternative cost of generation.
As Deputies are aware, the ESB had proposed to close the station in 1985, so there has already been an extension of seven years. In view of the age of the power station continued operation must depend on significant new investment. Regrettably, the investigations so far do not provide an economic basis for such investment.
The professional advice available to us indicates that the continued operation of the Arigna station would probably require an open-ended financial commitment. If local interests consider that a workable proposal for the buy-out of the plant, the purchase of local coal supplies and the sale of electricity to the grid could be developed, this could of course be considered. This would, however, involve local interests taking full responsibility for the operation of the station and assuming the associated financial risks. This is the only basis on which an intervention in the ESB decision to close the station would be made and any submissions from the local community in this regard will be fully considered.
When the ESB decision to close the station was taken every effort was made to provide alternative jobs in the Arigna catchment area. The local authorities and State agencies in the area were commissioned to act as facilitators for all worthwhile investment. In addition, the ESB were asked to come up with funding for local business initiatives. We are pleased that so far the enterprise development agencies in the area are working well with some good job creation results to date.
While the exhaustion of commercially usable coal around Arigna was both inevitable and regrettable, the type of initiatives already taken as a result of this intervention on alternative job creation is the best assurance for the long term economic and social wellbeing of the Arigna area.
As I have already wished Deputy Reynolds's colleagues well in the forthcoming election, I now wish my good friend, Deputy Reynolds, success, but of course not at the expense of my Fianna Fáil colleagues.
I thank the Minister for his good wishes.
The Dáil adjourned at 10.15 p.m. until 10.30 a.m. on Thursday, 5 November 1992.