Vol. 703 No. 4
57 Deputy Róisín Shortall asked the Minister for Communications, Energy and Natural Resources the position regarding the percentage of bio-fuels in the market here; the percentage that is imported; the origin of these imports; and if he will make a statement on the matter. [10124/10]
87 Deputy Catherine Byrne asked the Minister for Communications, Energy and Natural Resources the measures he is planning to introduce to promote bio-fuel production domestically in view of setting a bio-fuel content for petrol and diesel target of 4%. [10163/10]
I propose to take Questions Nos. 57 and 87 together.
The national bio-fuel obligation will require suppliers of road transport fuels to ensure that 4% of their volumes sold on the Irish market is bio-fuel. The legislative basis for the obligation is provided for in the Energy (Biofuels Obligation and Miscellaneous Provisions) Bill, which has recently been introduced in the Oireachtas with a view to its enactment in the coming weeks and entry into force by July next.
My Department calculates that in a full year, approximately 220 million litres of bio-fuels will be required to deliver the 4% target. In 2008, the last year for which data are currently available, 85 million litres of bio-fuels entered the Irish market. My Department currently compiles information on the origin of bio-fuels imported under the mineral oil tax relief schemes, MOTR. Under the schemes, approximately 30% of eligible bio-fuels were produced in Ireland in 2008, with the remainder being imported.
The production of bio-fuel in Ireland has been incentivised to date under the mineral oil tax relief schemes, which have resulted in 18 projects being awarded excise relief on specified volumes of bio-fuel they produce. At least five bio-fuels plants have been constructed or redeveloped on foot of excise relief granted under the schemes. A number of others are either at an advanced stage of planning, or have received planning permission.
Prior to the introduction of the excise relief schemes in 2005, market penetration of bio-fuels in Ireland was almost non-existent. While a figure for market penetration for 2009 is not yet available, it is expected to be in excess of 2%. The steady growth in indigenous bio-fuel production is reflected in the fact that it represents over 50% of bio-fuel production to date. The excise relief schemes were designed as an interim measure to increase the level of bio-fuels in the fuel mix and to encourage the development of an indigenous bio-fuels industry in advance of the introduction of the national bio-fuel obligation.
The national bio-fuel obligation will, by definition, incentivise the sustainable growth of the Irish bio-fuels market and will support indigenous bio-fuel producers and expand the sustainable indigenous production of bio-fuels. The EU sustainability criteria will also provide competitive advantage for Irish and other EU producers by ensuring that non EU imports meet strict environmental guidelines.
I welcome the forthcoming legislation. It is common sense in terms of the percentage determined. However, I am sure the Minister is aware there has been quite harsh criticism from the indigenous and developing bio-fuels industry that it is simply being left up to the market to determine how this will develop. Will he accept that if he pursues the current policy, if it can be called a policy, we are in danger of simply replacing one imported fuel with another one?
Has the Minister a strategy to develop the indigenous enterprises in a coherent way? I have no doubt the Minister, as is his wont, will make very flowery speeches about the bio-fuels sector as he does about the wind sector and other renewable sectors which are very often still stuck and underdeveloped because of a lack of a strategic approach by the Government. I have several questions on the indigenous bio-fuels sector and sustainability. How does the Minister intend to ensure Ireland exceeds the 30% target? How does he propose to ensure rigorous sustainability criteria are applied to imported bio-fuels? How will sustainability be tracked to create confidence that Ireland is not part of the problem in the developing world, particularly with regard to the effects of bio-fuel production on agriculture?
Bio-fuels are not an area in which the market can be left to its own devices as to do so would result in unsustainable fuels being imported from rainforest regions and other unsustainable sources. This is the reason I was active and supportive of the European Union proposal for sustainability criteria to be the first requirement. This means legislation set in Brussels rather than individual markets would be the deciding factor. The crucial issue in this respect is that a carbon reduction requirement of 35% would exclude a whole market from exporting bio-fuels to this country. The United States corn to ethanol market, which caused considerable damage and undermined domestic Irish production, has been stopped by the imposition of sustainability criteria.
While I wish to pursue the development of an indigenous market, this must be done within the rules of the World Trade Organisation, particularly given that our agriculture sector lives by the rules of that organisation. We cannot breach WTO rules in one area while seeking the protection of the WTO in other areas in which we may have commercial advantage.
The first requirement for the development of an indigenous industry is to have a secure, stable market in Ireland. Significant domestic supply sources, both in waste products and the agriculture sector, will have commercial viability in a more stable market. The first requirement is to find out how this works under the European Union's sustainability criteria.
I understand Ireland can take three specific measures in conjunction with the legislation to promote the indigenous bio-fuels industry. Different countries take different views on import tariffs, with Germany and Britain taking different approaches. Which country's approach does the Minister favour? The French have decided to ignore the issue of import tariffs by requiring localised production of bio-fuels before they can be used in the blending process. What is the Minister's view of the French position?
I understand it is possible to require that ethanol be of a certain quality before it can be blended. I refer to ethanol rather than bio-diesel because the former has been the subject of more discussion. Imposing such a quality standard would effectively preclude the use of sugar cane in the production of bioethanol. What is the Minister's view on having such a requirement?
These are complex technical issues which are, I understand, related. In the systems adopted by the countries to which the Deputy referred, a defining choice must be made about whether one discriminates against unrefined ethanol products versus refined products. I understand that refined ethanol can be transported from Brazil to Europe, whereas unrefined ethanol would not survive such a long journey. A number of European countries, of which Germany, I understand, is one, have introduced a requirement that bio-fuel imports must be non-refined. In so doing, they have protected sources of domestic production. My Department has met a number of those who are examining this complex and difficult issue. A difficulty is that if a similar requirement was in place here, we would have to import bio-fuels from European sources, rather than Brazil and it is not certain that such circumstances would be better for Irish farming.
While the Department is open to considering various regimes, I am reluctant to follow a particular course until the European Union publishes or establishes sustainability criteria. It would be best to administer the system on the basis of continuing review to ensure it supports indigenous producers. How one does this is not as clear or simple as following a German or British model.
The Minister failed to answer my questions on two of the three issues I raised. Irish farmers do not have a problem competing with other European countries in the area of ethanol production. Competing with sugar cane plantations in Brazil is making life potentially impossible for them. The Minister raised the prospect of importing unrefined ethanol from other European countries. The Irish market is capable of competing with other European markets.
Such a scenario may not meet our common objective of giving Irish farmers a viable market supply. If we were to go down this avenue and we ended up importing these products from Rotterdam or elsewhere, it would not be of any benefit to the Irish agricultural sector. In that case, it would not be the correct course of action.
58 Deputy Kathleen Lynch asked the Minister for Communications, Energy and Natural Resources the position regarding the timeframe for setting up initiatives to analyse broadband speeds experienced by end users here; and if he will make a statement on the matter. [10131/10]
I support proposals to conduct an audit of the quality of service experienced by broadband service customers compared to the quality of service advertised by suppliers. Ideally, this study would be conducted in a manner which would also permit international comparisons.
In June 2009 the European Commission published an invitation to tender for a contract to conduct a study and prepare a report on the quality of broadband services available to customers in the European Union. The emphasis of this study, as proposed, was on measuring real time customer experience across the European Union compared to the speeds and other quality of service parameters advertised by broadband service providers.
In January last, the European Commission announced that following a thorough assessment of the eight bids it had received, it had decided that none provided sufficient guarantees that reliable robust data would be obtained. The Commission therefore decided to close the tender process without awarding a contract. In its announcement, the Commission also indicated it may recommence this procurement procedure.
Following informal contacts between my Department and the European Commission on its likely plans to re-tender and the likely duration of the study after the award of any contract, which would be expected to be nine months or more, I have decided to commence a study of broadband speeds available to customers in Ireland independently of the proposed wider EU study. My Department has commenced drafting an invitation to tender document. The formal invitation to participate and the contract award process will accord with competitive public procurement arrangements. I expect the tender document to be available to participating parties shortly.
My heart sank when I heard it would take at least nine months for the European Union to award a contract. For this reason, I welcome the Minister's decision to proceed with a tender process. The Minister indicated a tender document would be available shortly. Will he specify exactly when he expects the proposed initiative to proceed?
I presume the Minister is well aware of the serious problem we have with slow connections. Numerous reports have pointed out that Ireland's broadband performance is dismal in comparison with that of other countries. We have the highest percentage of slow Internet connections in Europe and rank fifth lowest for high speed connections. Ireland will not be able to compete unless we get our act together on broadband speeds.
The Minister should examine his own advice before developing an initiative. Until recently, he advised Deputies to visit the website www.broadband.gov.ie for information on operators. If one were to do so, one would find that 75% of the listed suppliers no longer exist. That is a shoddy performance.
We must address the issue of broadband speed. With regard to the assessment of the slow speed of broadband services in Ireland, how does the Minister propose to address this issue in parallel with ascertaining how bad the position is?
We are addressing the issue through a range of measures, including investments in 100 megabit connectivity in schools, Project Kelvin, a high speed connection between North America and Ireland, and the exemplar network which creates potential to overcome the slow spot in the Internet, namely, the choke point at switching equipment. We are making a number of investments which provide an opportunity to speed up the networks. Before doing so, however, we must first find out what are current broadband speeds. I expect the tendering process to award a contract for carrying out this task will take place within the next two or three weeks.
I look forward to the publication of broadband speeds because I believe it will confirm recent OECD findings that Ireland is one of the fastest improving countries in the area of broadband. I acknowledge that we are coming from behind and need to do more, but Ireland is in the top three or four OECD countries as regards catching up and becoming faster on the Internet.
At least we finally have some acknowledgement from the Minister that there is a problem with speeds. Every time he is questioned about broadband, he starts reeling off penetration figures. They are impressive but all they suggest is that people want broadband. Unfortunately, however, they have to use second-rate broadband by and large. Deputy Kathleen Lynch's question concerns how we measure progress in terms of doing what is most important in broadband, which is to provide lots of bandwidth quickly so that Ireland can try to catch up with other countries that are moving ahead in this area. As regards the State's broadband infrastructure, can the Minister give us a date for the one-stop-shop? That question was already asked by Deputy Coonan.
The first thing we have to do is pass the legislation tomorrow. That is the first crucial date and, as I said in my reply, we must proceed with the one-stop-shop this year. While I acknowledge that we have been behind, one of the primary reasons was that we had a series of ownerships in Eircom that took a short-term position, which was not investing in the networks. It seems to me that over a number of years it was extracting as much value out of the company as possible. I have high expectations that the new ownership, STT — which comes from a country where they have invested in very high-speed broadband and which has a telecoms company with the latest network technology there — will transfer some of that expertise and know-how into the network here to get value back on its investment. That is a crucial development I am looking at this year in order to increase speeds. What will incentivise it is the development by the cable network of DOCSIS 3 technology on that cable network, which will bring quicker broadband speeds to tens of thousands of houses this year and next year. It is that competition, as well as the prospect of fourth generation mobile, Wymex, new satellite technology or evolving fixed-wireless technology, which will allow speeds to double. They are doing so. It is a key requirement for us to keep pushing various companies to make investments, which will see customers getting the benefit of faster speeds. That can and will happen.
Will the Minister ensure that companies do not get away with making misleading claims? Companies often promise speeds up to a certain level, which is pretty meaningless because most of the time they are way below that. The website, which is the Minister's responsibility, is currently under construction. Will he acknowledge, however, that it does not look good for such a website not to be up to date? I know we are concentrating on speed, but even with a national broadband scheme 12,000 households will still not have broadband services at all. The Minister must deal with this, so has he come up with a solution to provide those households with broadband? If not, they will be at a great disadvantage. It is not as if they can wait a while and expect to get broadband, because even after that scheme is completed they will not have broadband.
I have raised the issue of open access to ducting with the Minister before and he said he was considering it. What conclusion has he drawn as to whether we should be regulating to require open access to ductings so that people can lay fibre to deliver high bandwidth, high-speed broadband into people's homes and businesses?
As I said to Deputy Coonan earlier, that is why we went to Brussels and got EU state aid approval for a new, additional rural scheme which will require us to provide alternatives for those 12,000 houses.
We were dissatisfied with the quality of information on the website and that is why I took it down. Companies were not providing sufficiently up-to-date information. ComReg does provide a website which has the same or similar information, so I am satisfied to direct people to it.
That is hardly open access.
Open access is the concept with the one-stop-shop. That ducting is to provide it on an open access basis. It is up to the regulator to try to pursue and promote open access in other key network infrastructure and that is happening.
The regulator needs policy guidance from the Minister.
I gave very clear policy guidance and in the last few weeks the outcome has been — as was raised in the last session of oral questions — that the arrangement saw a drop in line-share costs of approximately 80% to 90%. Further decisions are being made about unbundling the network, which is happening. The reality therefore is that companies are starting to see the wisdom of a more open access policy. It is the way to get an economic return on difficult investments, which is what we must now see happening.
Written Answers follow Adjournment Debate.
