Vol. 615 No. 1
68 Ms Burton asked the Minister for Communications, Marine and Natural Resources if he has reviewed the new EU strategy for biofuels which was presented on 8 February 2006; the progress which has been made on implementing the 2003 EU biofuels directive; and if he will make a statement on the matter. [6716/06]
The communication on biofuels published on 8 February is part of the broader EU biomass action plan published in December 2005 and proposes a range of detailed policy measures to encourage biofuels and remove market barriers. I welcome this initiative by the Commission and my Department is examining the communication in conjunction with the Department of Agriculture and Food and the Department of Transport in the context of the policy debate on the overall biomass action plan.
The EC biofuels directive sets indicative targets to member states of 2% market penetration for biofuels by the end of 2005. Noting that we are starting from a very low current production base, we aim to meet the 2% target by 2008 through targeted fiscal measures designed to stimulate market development.
Under the 2005 scheme for mineral oil tax relief for biofuels, eight projects have been awarded excise relief, including four pure plant oil, three biodiesel or other biofuel and one bioethanol proposal. It is estimated that the pilot scheme will result in 16 million litres of biofuels being placed on the Irish transport market by next year.
Building on the success of the pilot biofuels scheme, I have agreed with the Minister for Finance a further targeted package of excise relief valued at €205 million, which was announced in the budget. The new excise relief programme, which is subject to state aid approval, will run to 2010 and will enable us to reach the initial target of 2% market penetration by biofuels by 2008. I am also providing funding towards the capital cost of developing biofuels processing facilities, which will critically underpin the excise relief package. Set in the context of EU developments, work is ongoing to put in place a policy framework for the development of the Irish biofuels market taking into account the perspectives of agriculture, transport and other relevant sectors.
I thank the Minister for his answer. In his reply to a recent question he said the total contribution of biofuels to the transport sector is approximately 0.00002%. Will it not be an incredible challenge to meet the 2% target over the next few years and an even greater challenge to meet the EU target of 5.75% by 2010? Has the Government not had a deplorable record in this area?
The EU strategy presented on 8 February to which the Minister referred includes seven policy axes, one of which refers to possible mandatory targets for member states. Is it the Government's intention to pursue a policy that includes mandatory targets? On the forthcoming European Council does the Government have any views on the common energy policy for Europe? The fiscal reliefs mentioned by the Minister are welcome and I commend him on taking that step. The United Kingdom Government has introduced a renewable transport biofuels obligation which will demand that 5% of all petrol sold in the UK is biofuel-based. Has the Minister considered such an obligation?
Approximately one year ago I asked the Minister if he would lead by example and ask the Taoiseach to change the Government fleet to greener and more biofuel-oriented vehicles. This was asked later by another party. It was announced around the time I asked the question that the UK Prime Minister, Mr. Blair, had made a similar request to his Government and no less than eight Ministers abandoned their Rovers and Jaguars for high-tech and greener alternatives. Does the Irish Government intend to give up the Saabs, Mercedes and Volvos, transfer to biofuel or electric alternatives and lead by example——
Hear, hear.
A Jaguar.
——or, as is the case with so many other issues similar to the one I have raised, will the Government wait until this side of the House is in power and we show it what to do in this respect?
When I was in Government with the Labour Party, I did not notice a rush away from the Mercedes.
This is a different Labour Party.
The Deputy will be pleased to note when I was in the Department of the Environment, Heritage and Local Government, I made inquiries about a Toyota Prius hybrid car and was informed that the purchase of the cars for the ministerial fleet was a matter for the Garda Commissioner. I think we might have been restricted to EU cars. The Deputy will be pleased to know I have again requested a hybrid car and hope that by approximately April I will be driven in a Lexus hybrid.
I congratulate the Minister. I will have to save for one.
The figure for penetration of biofuels by the end of 2005 was approximately 0.06%. This will increase to 0.13% by the end of this year and the initiatives announced in the budget will bring us to our target of 2% by 2008. Few member states, approximately ten, have identified targets of more than 2% for 2005. I am supportive of moving this up but we have to create the infrastructure. That is the design of the incentives introduced in the budget, to create the infrastructure and encourage the processing of biofuels and so on.
I am not enamoured of mandatory targets. This one-size-fits-all approach is taken in the EU in various areas and does not take factors such as the size of our market into account. We have the same approach in the energy market generally. I am not sure one can make mandatory targets that should apply across Europe.
One needs targets.
I was about to say that. I agree with the Deputy that we should have firm targets and meet them. Although our EU targets in this area are not mandatory, the Commission is attempting to pursue us legally on that matter and we will resist that strongly.
I support the Minister. For many years we have been calling for the building up of infrastructure for our own oil industry. I welcome that. I would be keen to see an ethanol industry established from the closure of our sugar industry among other possibilities.
In the long run, from after 2010, once we have established a basic industry and raised our percentage to 2% to 5%, rather than providing simple tax reliefs or duty exemptions for biofuels, we should set up a percentage requirement that all fuels would have to have, be it mixed in or in the form of biodiesels etc. This would move the costs, which can be significant in terms of lost tax revenue, from the Government and the people to the oil companies and fuel consumers. We should signal this now. Does the Minister agree that in the long run we must switch to such a system? While he may not agree with mandatory targets on a European level, it makes sense for us to have a mandatory biofuel requirement because that saves the taxpayer money as well as doing the right thing environmentally.
While I agree with the Deputy we first need to set up the infrastructure, create the demand, and afterwards explore the route he outlined. When I referred to mandatory targets I meant those that the Commission might set. I think we would follow the route he suggested and I anticipate that this could happen sooner rather than later.
69 Mr. G. Murphy asked the Minister for Communications, Marine and Natural Resources the extent to which he expects his Department to contribute to achievement of targets set in the Kyoto Protocol; and if he will make a statement on the matter. [6604/06]
80 Ms Enright asked the Minister for Communications, Marine and Natural Resources his targets for a reduction in the importation of fossil fuels with a view to achieving compliance with Kyoto and improved economic performance; and if he will make a statement on the matter. [6618/06]
I propose to take Questions Nos. 69 and 80 together.
As I mentioned earlier, my colleague, the Minister for the Environment, Heritage and Local Government, has lead responsibility for Government policy on meeting Ireland's target under the Kyoto Protocol. The energy sector will make its contribution to meeting our obligations under Kyoto through participation in the EU emissions trading scheme. The problem of dealing with high fossil fuel dependence as carbon constraints become more pressing is not unique to Ireland. At EU and international levels, energy policy is focusing increasingly on the development of alternative renewable energy sources, increasing energy efficiency and managing energy demand in response to the need to limit CO2 emissions.
There are also key imperatives for Irish energy policy. We are on target to meet our objective of increasing electricity generated from renewable sources to a minimum of 13.2% of total consumption by 2010. I expect that wind generation will remain the dominant technology in the short term for delivering this target. The forthcoming energy policy paper will address strategies to develop the renewable energy base. In addition, as announced in the recent budget, I am putting in place measures designed to complement and expand on initiatives already in place in the renewable electricity, transport and heat sectors. These new programmes will assist the enhanced deployment of renewable sources of energy over the next five years in the bioenergy, biofuels, CHP and domestic energy sectors.
Energy efficiency has a significant role to play in reducing both energy demand and lowering emissions and is often described as the cheapest and cleanest method of meeting these objectives. It is essential that we continue to raise awareness of this issue right across the economy and bring about a step-change in the way that we use energy. We intend to highlight this, within the Department in terms of an active campaign, towards the end of this year.
Does the Minister accept that investment in research and development is likely to have the greatest impact in terms of broadening the base for renewable energy in the future? Will he agree that this is accepted by the recently published report of the European Commission? Does he not agree that €20 million or €100 million invested in research and development will have much more impact than carbon trading, in terms of value and in terms of achievement of our targets?
Incidentally, if the Minister is getting that electric car, he should not use the Japanese model, the prototype of which was launched recently. It goes at 187 mph and accelerates from zero to 60 mph in three seconds. Even Ministers should be careful about something like that.
I agree with the Deputy that investment in energy research and development is extremely important. That is why we have focused on this. We are putting in place an energy research council to focus efforts on this and on other areas within the Department. It is extremely important, not just nationally. The EU, in its Seventh Framework Programme, has signalled clearly that it intends to focus on fuel diversity and energy research. That is most welcome and it is something in which we actively participate.
I commend the Minister in having been willing to look at energy policy on a more cross-party partnership basis. I regret our discussions on areas such as this are limited to brief question periods occurring at two or three-monthly intervals but commend the Minister, nonetheless.
Having given the Minister that commendation, however, I am utterly critical of his rose-tinted glasses view of the greenhouse gas situation here and his assertion that we are not as bad as we thought we would be. What we were seeking to do in the cross-party energy analysis was to think long term and to be honest with the people. Will the Minister not agree, based on all the scientific information to hand, that we will be looking at a 60% to 80% reduction in emissions——
I call on the Minister for a final reply.
I was not praising us too much in what I said earlier and the situation is not as bad as had been projected. I accept, absolutely, the point the Deputy is making, however. We need to do much better and to examine ways and means to ensure that our emissions are as near to the 13% plus as possible.
Written Answers follow Adjournment Debate.
