As Deputy Mac Lochlainn is not present, I call Deputy O'Donovan.
Energy (Miscellaneous Provisions) Bill 2011: Second Stage (Resumed)
Question again proposed: "That the Bill be now read a Second Time."
I welcome the Minister of State, Deputy O'Dowd, and welcome the opportunity to speak on the Bill. In moving the economy forward, an element that will be critical in enabling us to encourage investment and employment is that we have the necessary and adequate infrastructure to sustain employment. Part of this will be the provision of a good water supply and part will be the provision of reliable, fast broadband service but a very important part will have to be a good, reliable, accessible, affordable energy sector.
It is a part of the competitiveness issue that we are often reluctant to put this sector in the headlights and examine the implications it has for the economy as a whole. We are often encouraged to speak about competitiveness in terms of just one headline, that being salaries, costs of employment and so on, but access to a good and reliable energy source is something we have to come to terms with. We cannot reach a situation where, for example, industrial employers are faced with energy interruptions. Where employers look to move into the regions, isolated areas or small towns and villages, we cannot have a situation where they do not have access to a reliable energy supply, whether from EirGrid or another future supplier.
In talking about the country's energy sector, it is important to point out that at present 95% of our energy comes from imported fossil fuels. While huge improvements are being made in the renewable energy sector in terms of wind, particularly in my part of the country where there is a huge number of wind turbines, we are behind the curve in regard to international best practice on deriving energy from renewable sources. One need only look at the amount of energy recovered in Ireland from tidal sources, which is practically nil. Although many people have become involved in solar energy recently as private individuals from the point of view of retrofitting and making houses more energy efficient, the State is not doing much.
With regard to the amount of energy used in State buildings, I ask that the State assess how energy efficient its stock of infrastructure is, whether this is in Government offices, post offices or any other national infrastructure, in the same way the local authorities did this in regard to their office buildings and, to a lesser degree, their housing stock. The energy efficiency of these buildings and the amount of renewable energy used to heat and light them is, I assume, practically nil. From the Government's point of view, there is an opportunity to lead by example in this regard.
Deputies referred to interconnection and the importance of having the national grid connected to the UK and mainland Europe. This goes back to the point on over-reliance on imported fossil fuels. While we have an emerging wind energy sector, the problem is that there are times of the year and even times of the day when there are fluctuations in the amount of energy that can be recouped from wind. It is important, if we are building a good amount of renewable energy sources into the overall national picture, that we have reliability so we can switch on and off the tap from Britain and further afield in mainland Europe.
This brings me to the section of the Bill dealing with energy efficiency. We must question the efficiency of our grid and the amount of energy lost throughout the country through dissipation from power lines. If we were to liken the national grid to a highway, there is a dual carriageway through the centre of the country, a set of national roads off it and a series of local roads. We need to look strategically at the national grid with a view to addressing the imbalance. At present the national grid is almost like a mainline railway station in that people can go anywhere they want as long as it is Dublin. It is the same with the national grid in that it goes anywhere people want as long as it is Dublin, because the main power plants, some of which are located close to my area at Moneypoint, Tarbert and Ardnacrusha, are all cabled into and out of Dublin. In terms of balanced regional development, there is an opportunity to act on this issue.
The Bill refers to energy efficiency and to the sustainable energy Ireland project. I implore the Minister of State to talk to his colleague, the Minister for the Environment, Community and Local Government, who has responsibility for local authority housing. At present, long-term local authority tenants have no way of getting their houses insulated to make them more energy efficient. However, if they move out and leave a house vacant, the local authority will make it energy efficient, which is a ridiculous situation as the local authorities should try to reward the person who has been there and paying rent down through the years.
I welcome the Bill and wish the Minister of State with responsibility for the NewERA agency the best in the next few years. This legislation is hugely important and has the potential to make a major impact on the economy.
The Bill has been designed to improve and tidy up an increasingly important area. Efficiency and effectiveness lie at the heart of the Bill, which is why it has to be warmly welcomed. Features such as the energy demand reduction target programme and the empowerment of gas safety officers are essential in promoting better and safer use of our finite energy resources. Other welcome aspects include the new provisions against the theft of electricity and gas in the new, open and competitive market and the extension of the powers of the Commission for Energy Regulation to provide for better regulation, with new electrical investigation officers and clarification of the power of gas safety officers.
A major component of the Bill is the putting in place of a new legal framework in primary legislation for the placing of energy efficiency obligations on energy suppliers and distributors. This will result in the Minister for Communications, Energy and Natural Resources being empowered to set energy efficiency targets and, crucially, oblige energy companies to provide energy efficiency measures for their customers. The power which will be conferred on the Minister to go to the High Court in cases in which energy companies are failing to comply with their new energy efficiency obligations is even more significant. I welcome the opportunities that will be afforded by section 12 which provides the flexibility to establish voluntary agreements to promote energy efficiency and confers on the Minister the power to approve or revoke such agreements.
Aside from the moral obligations on a developed country such as Ireland to enact legislation to combat climate change through better and more strategic use of our energy resources, there is another reason I welcome the Bill. It concerns the recognition and rewarding of schools and businesses which display great foresight and initiative by installing renewable energy generators such as wind turbines. Since early summer, I have been attempting to examine why it is a school or business cannot be recompensed for the unused electricity generated by its wind turbine which is fed back to the national grid. For example, a school will use all of its wind-turbine generated electricity during the school day but very little after school hours, at weekends and during holidays. It pays for the additional electricity it needs from the grid during the school day but receives nothing in return for the electricity it returns to the national grid.
A consequence of competition and a liberal marketplace is the plethora of new actors in the sector. Instead of just the ESB, we now have ESB Networks, EirGrid, the Commission for Energy Regulation, ESB Electric Ireland, Bord Gáis Éireann, Airtricity and others. The result of this is that attempts to rectify problems and find solutions become overly-complicated, if not almost impossible. The pleas of Lisheenkyle national school near Athenry and the Killary Adventure Centre in Leenane, Connemara, are prime examples. Both have installed wind turbines, created and built by a local Galwegian company, with the aim of reducing electricity costs and promoting sustainability. Neither is seeking financial gain from the additional unused electricity supplied to the national grid but merely a reduction in their electricity costs. When I raised the matter in the House, I was informed that the Minister no longer had a statutory function in this area. Moving to EirGrid, the body responsible for operating Ireland's electricity transmission system, I was informed that the matter was relevant to the electricity supplier, with which an arrangement would be required. To complicate matters further, establishing such an arrangement would require the installation of a special meter, which work would only be carried out by ESB Networks. When I contacted the ESB, I was informed that there were such agreements for micro-generation of electricity but that they were available to eligible domestic customers only. Schools and businesses need not apply. The Commission for Energy Regulation confirmed that these arrangements with domestic customers were voluntary and that the commission had no scope in specifying or directing such matters because the retail market was fully deregulated. While it is clear that everyone agrees the promotion of sustainable and environmentally friendly electricity generation is a great idea, no one is prepared to take responsibility for it. Is it any wonder, with all the pointless running around that has to done, that schools and businesses are despondent and exasperated?
Nevertheless, this new Bill can represent a new opportunity. If, as seems to be the case, it will facilitate and empower the Minister or another authority, as per section 13, to promote energy efficiency and sustainability and hence reward schools and businesses for their efforts, it is to be especially welcomed. I am happy to support it because it provides an opportunity for positive change. However, should it fail to provide for this recognition and reward and, thereby, reduce costs for the schools and businesses which have installed renewable energy generators such as wind turbines, a further amendment of energy legislation might be required.
I welcome the opportunity to contribute to the energy debate. Deputy O'Donovan painted a picture in this regard. This is one of most exciting areas in which to be involved and I wish the Minister of State well in his brief.
We spend billions of euro per annum on fossil fuels. Economies and technologies have developed since the discovery of oil and everything is based on the use of fossil fuels, whether it be our heating systems, transport, electricity generation and the generation of other forms of energy. We are having difficulties in making adaptations such as introducing battery powered cars because there was no focus on this issue in the past. If people had been more broadminded and had not put all their eggs in one basket, it is possible, for example, that many wars would have been avoided. Some of the wars taking place today would not have commenced and there would not be trouble and suffering in many countries because of the rush to secure oil resources. That is the challenge we face.
Our indigenous renewable energy resources are a good news story. I come from a county that has such resources in abundance, but there are serious problems with the development of their potential. In particular, County Mayo has the highest wind speeds in Europe and planning permission was granted seven years ago for the largest wind farm in the State, a 350 MW wind farm at Bellacorick. However, if it was to be built in the morning, the national grid would not have the capacity to harness the power generated by the farm. The county council recently drafted and validated a renewable energy strategy which recognised the potential of the wind farm. It also identified that the county had the capacity to generate 20,000 MW through the use of wind turbines, while avoiding any impact on SACs, housing and so on. No one has suggested numerous wind farms should be built, given that no 400 kV line passes through the county.
I have serious issues with the progress made by EirGrid in providing grid capacity in County Mayo. Wind farms are being built elsewhere in the State, for example, in County Offaly where wind speeds are lower, because grid capacity is available. County Mayo has the resources but infrastructure is not being provided. There are not even plans for an expansion of the grid. Investment capital and companies with expertise in this area were available and such companies were dying to invest, in my county in particular, but they have invested in Scotland or elsewhere where grid capacity and high wind speeds are available and the powers that be have the wherewithal through licensing and so on to make it more business friendly to generate power.
Likewise, there are five ocean energy sites throughout the world, including the Cape of Good Hope. A test site has been identified off the Mayo coast, but there is no connection for devices at development stage. There is a great deal of interest in developing prototypes and transforming them into commercially viable wave energy machines that could be part of our energy solutions. There is a test site but no cable; therefore, the prototypes are not being developed. However, again, this is happening in Scotland.
The Minister of State will be aware that there is massive frustration. Every other week I am approached by a lobby group or an individual in my office to find out what is happening because a connection to the national grid cannot be secured. In the existing gate system, there are those with offers to the grid who have secured planning permission but if the wind farm is built in Bellacorick, there will be no capacity on the grid for them, so even though they invested money in developing community wind farms, they lose out.
We need a Gate 4 to take cognisance of the ambition in the programme for Government to develop wind in a clustered fashion. We have identified the hot spots for wind so we should fast-track the delivery of grid to those areas and avoid getting caught up in the current gate system, where there can be a person at one end of the county with a grid offer but no planning permission and a person at the other end with planning permission but no grid offer. The person with the grid offer might not intend to build a wind farm and now has a commodity he wants to sell to the person who wants to develop a wind farm. This is an absolute mess.
From replies to parliamentary questions I have tabled, I know there is some recognition that there is a problem but we need to see movement. Money is an issue in the country but these are solutions. If we invest now, we will achieve energy security while reducing carbon emissions. We should think big about this, not just hitting European targets but becoming a major exporter. If we invest now, it will be to everyone's benefit, with sustainable jobs and energy.
I would like to see this area being given a new lease of life. The Minister of State is very interested in this and is accommodating ideas and concerns. This would be a good news story when so many things are outside our control, because this is our own resource. Those of us who live in the west tend to look east but we have this resource and if we get assistance to develop it, it will benefit the entire country. It will allow us to play our part in the economic recovery of the country and develop our green economy.
I welcome a Bill that addresses such an important sector and the opportunity it gives us to discuss this issue. There are elements in the Bill that we welcome. Anything that enhances or improves energy efficiency is welcome, as is setting targets and making resources available to improve energy efficiency. Similarly, anything that gives greater powers to State agencies to ensure safety is important. Safety should always be paramount when talking about electricity or gas.
Those measures are welcome but like much of the legislation the Government has introduced in recent months, these are partial measures that go a small way in the right direction, although not nearly far enough, while there is a worrying ideological element that underpins the legislation: the obsession with markets, liberalisation, as it is euphemistically called, and the deregulation of the energy sector. This Bill it underpins that approach to dealing with this important issue. While there is emphasis on energy efficiency and saving energy, and that is welcome, there is a worrying law and order approach to it. It is the wrong focus; it is an example of the Government wanting to appear determined about something while focusing on the wrong area.
I agree with Deputy Mulherin that if we are talking about energy, we must talk about two key areas, one of which is partially addressed, while the other is not covered at all. This country is massively dependent on imported energy, oil and fossil fuels. In a situation of severe and worsening economic crisis and problems with the public finances, on the question of prioritising investment, and this must be public investment because the liberalised energy sector simply does not reach the mark, we need massive public investment to develop sustainable energy resources. Deputy Mulherin is right when she talks about the west of Ireland. We are probably uniquely located in the world to develop these energy resources. We have wind, wave and tidal energy resources that are the envy of the world. We have completely failed to develop those resources at the speed and on the scale necessary. There have been improvements, but when the Deputy says there is frustration about this, the Government must agree with her. The technology is being developed and innovation is taking place in the area. There have been excuses about the technical difficulties of storing electricity but those are nonsense. There are methods and concepts for the storage of renewable power that could be made to work if we invest in them.
There must be large-scale investment. Instead, part of the motivation for this Bill is the need to bring our energy authorities into compliance with the moves towards liberalisation of the energy market, which is really just another name for the privatisation of that market. It is about opening the door to those who see this as an opportunity to make money but who do not see any priority in the State developing its energy resources in the interests of the people.
I encourage the Government to consider the role the ESB played in the 1920s and 1930s, when this country was on its knees. It was a poverty-stricken, virtually Third World country but the State decided — there were no socialists at the helm then — to electrify the country by creating a State enterprise to do it and investing resources and energy to make that happen. That transformed this country. As a result of the diktats of the troika, we are considering selling off parts of that very successful State enterprise at a time when it should be protected, invested in, developed and expanded. The enterprise to which I refer should be retained in public ownership and used as a vehicle for massive investment in both the infrastructure and research and development necessary to allow this State realise the enormous potential it possesses in the context of developing wind, wave and other forms of energy. I take this opportunity to urge the Government to consider the importance of what I am saying.
Much of the time, private entities do not have the resources necessary to allow them to proceed with projects. In addition, as a result of their focus on making short-term profits, many companies are not willing to put in place the level of investment required in the long term to develop the type of natural resources to which I refer.
I have some serious difficulties in respect of the thrust of the Bill. In the context of energy deficiency, there is a considerable emphasis in the legislation on encouraging behavioural change on the part of customers as if this is really the way in which we should deal with the problem. The Bill creates penalties for customers engaged in what is described as "energy theft" or inefficiencies. I am not in favour of either inefficiencies or theft. In so far as there are compulsions on energy producers to upgrade their technology, increase efficiency etc., these must be welcomed. Pressure should be exerted on such producers in this regard. However, the Bill emphasises that householders and consumers should be more energy efficient and I am concerned with regard to what this means.
In recent years the ESB spent a great deal of money developing smart meters. I do not know the current status of this project but I suggest that smart metering is not very smart at all. The good old-fashioned meters one can find in most homes are reliable. They do not need to be fixed and are not reliant on complex software, large computer databases etc., in order to operate. The development of smart meters has given rise to major technical problems. We do not need to install over 1 million smart meters, which would utilise untested computer technology etc., in order to pressure householders, particularly those who are less well off, not to use electricity at times when it suits energy providers to have extra capacity available. This means that if one is poor, one will sit at home in the cold and wait to turn on the heating at a time when it is cheaper for one's energy provider to produce electricity. That is not the way forward because it is not energy efficiency. In effect, it could prove to be a way to turn matters even more in favour of energy producers and their ability to make money and could lead to further pressure being exerted on householders to, in some cases, sit at home in the freezing cold. A huge proportion of the energy distributed throughout this country is used to heat people's homes.
When justifying moves to remove the household benefits package, which provides elderly and vulnerable people with some support in the context of paying gas and electricity bills, and outrageous cuts to the fuel allowance, the Minister for Social Protection, Deputy Burton, stated these developments would be balanced by investment in and support for household insulation programmes. The cuts to which I refer were scandalous and the Minister for Social Protection's comments in respect of them do not represent a serious attempt to deal with the problem of energy efficiency. As stated on a number of previous occasions, I am of the view that if we are serious about developing energy efficiency then the pay-as-you-save approach mentioned in the Bill would be an appropriate mechanism to employ. However, the Government must make a much more determined effort to promote and must invest a higher level of resources in this approach.
This matter was brought to my attention by Mr. Brian Connolly from County Meath, who is present in the Visitors Gallery and who rang me out of the blue and stated that I should recommend a particular methodology to the Government. He suggested that we should provide, either through local authorities or some easily accessible agency, people with loans to allow them to insulate their homes. These would be long-term loans and the repayments in respect of them would be low and would be at or about the level of the savings they would make as a result of their homes being insulated. Effectively, therefore, there would be no cost involved because the savings made from insulating their homes would cover people's loan repayments.
If the Government made a serious effort to promote and made a large investment in such an approach, imagine the number of jobs which could be created. Tens of thousands of construction workers who are currently unemployed could return to employment if a massive insulation programme were put in place. Such a programme would represent real action in respect of the problem of fuel poverty among the poorer sections of society. It would also generate massive savings and be a real move in the direction of ensuring energy efficiency. In addition, it would have a major impact in the context of the amount of energy we are obliged to import. I propose that the Government make a major push in respect of promoting such an approach. It should also be prepared to make a massive investment. Mr. Connolly argues that such a programme would not cost that much and would ultimately prove to be fiscally neutral for the State. There would, however, be a need to make a large, up-front investment in order to launch the programme, which could have massive implications both for unemployed construction workers and in the context of promoting energy efficiency etc.
The Bill empowers inspectors to search people's homes in order to discover whether they are engaged in energy theft. As stated earlier, I am not in favour of people engaging in such theft. Some 350,000 to 450,000 people lost their jobs in the past two years as a result of circumstances completely beyond their control and for which they were not responsible. These individuals are being savaged by austerity cuts and their fuel allowances have been cut. In the forthcoming budget, their rent allowance is going to come under attack. In light of all this, one does not have to be a rocket scientist to work out that desperate people may do desperate things to ensure their homes remain warm. The position in which they find themselves was created by the previous Government. Is it fair, therefore, that the State should advocate an approach whereby a coterie of people will be dispatched to terrorise householders and charge into their homes to discover whether they are involved in energy theft? I am of the view that the focus in this regard is completely wrong.
The focus we need is on investment in sustainable energy resources, which this country is uniquely placed to development. It will have to be provided by the State and part of that means not selling off the State's natural resources and key State companies. It means serious investment in a massive insulation programme and creating real incentives for people to insulate their homes by providing the funding up-front. In the interim, it means not attacking or penalising the little support available to poor working and unemployed people in vulnerable sectors of society to address fuel poverty in the form of fuel allowances. Such attacks are unconscionable. It is outrageous that the Government would take measures, in a country where people die of hypothermia and winter-related diseases in their hundreds every winter, to attack provisions such as the fuel allowance. It is beyond belief.
Deputy Boyd Barrett has one minute left.
On a matter not directly related to the Bill but something one could possibly squeeze in as an addendum to it, measures might be enacted to compel energy companies such as EirGrid and the ESB to have a little more consideration for landowners over whose land they want to put large electricity pylons and transmission lines to avoid the appalling situation which led Ms Teresa Treacy into prison simply because she wanted to see transmission lines put underground. It is quite possible to put those lines underground and the State should use its influence with the ESB and EirGrid to ensure that they are put underground where reasonable requests are made by people for that to be done and to avoid a situation where an elderly woman lands herself in prison because of the actions of a State company.
I now call on Deputy Patrick Nulty who, I understand, is sharing his time.
I would like to share my time with Deputies Lawlor, Corcoran Kennedy and Coffey.
Is that five minutes each?
That is correct.
As this is my maiden speech here, I thank the people of Dublin West and Swords who have lent me their votes to represent them here and assure them that I will work tirelessly on their behalf for so long as I remain here.
I am glad to speak on the energy Bill before us today. There are three aspects of it on which I want to focus: energy efficiency, what is called energy "theft" in the Bill and energy safety.
I very much welcome the provision to place in primary legislation energy efficiency obligations under the energy services directive. It is vital that electricity and gas providers play their part in helping to reduce energy demand. The best way to achieve such targets is through support measures which will achieve long-term savings such as better insulation and efficient appliances. Such long-term actions not only provide savings for the consumer but in the long term will help us as a country to meet our energy demand reduction targets. In that context, it is essential that the Better Energy Programme continues to be a priority for Government. The fact that one third of the total funding for the programme this year will go to addressing energy poverty is a welcome step in the right direction.
I very much look forward to the publication of the Government's energy affordability strategy. I hope the Minister and the Government will be cognisant of the representations made by organisations such as Age Action, the Society of St. Vincent de Paul and the Energy Poverty Coalition. It is worth noting that investment in energy efficiency is a significant potential source for job creation here. The 100,000 local authority homes across the nation is an area where, if we were to improve energy efficiency and insulation, we could not only make it easier to meet the targets we set ourselves in legislation and the targets set by the European Union, but we would put many of the people back to work. I am sure Deputies from right across this House have received representations from tenants in local authority homes who, because of the funding mechanism within the Department of the Environment, Community and Local Government, cannot get important upgrades, for example, to double-glazed windows. I urge the Department of Communications, Energy and Natural Resources to open dialogue with the Department of the Environment, Community and Local Government to address that issue.
On the question of what is called energy "theft" in the Bill, there is no doubt that energy theft, which the Commission for Energy Regulation estimates costs €30 million per annum, can and should be reduced. Importantly, these savings that accrue must be passed on to the consumer; they should not be retained by the large utility companies.
It is vital that, in tandem with that, the updated measures outlined in the Bill are used with caution, diligence and responsibility. Coupled with that, it is essential that the measures to address fuel poverty are given equal weight and vulnerable households are given support and assistance in reducing their energy usage. Where there is energy theft or fraud, that must be dealt with and it is right that it is dealt with in the Bill, but that is part of a package of measures. Equally, I welcome previous assurances given by the Minister that no household will have its gas supply cut off this winter due to arrears. It is an important assurance and it should be welcomed on the floor of this House.
The measures on energy safety are important and it is good to see them being placed on a statutory footing. For example, the extension of gas safety provisions to the LPG sector will assist in protecting households which derive their energy from this source and improving safety provision. This is particularly important given that the Department has noted that fatalities have occurred in homes in recent years as a consequence of problems in this area and the legislative protocols that we are bringing forward in this Bill are vital in that respect.
I also welcome the provision to allow electrical investigation officers to investigate works carried out by unregulated contractors. This type of regulation is what is needed in this area and in many other aspects of public policy. It is something that has been lacking over the past decade or more under previous Administrations. I also welcome the fact that gas safety officers will be placed on an equal footing with their electrical investigation officer counterparts.
Time, Deputy Nulty. I was reluctant to interrupt Deputy Nulty on his maiden speech but he is just one minute over time.
I congratulate Deputy Nulty on his election from Dublin West. I am in a neighbouring constituency. The Deputy beside him, Deputy Stagg, would know that too. I wish Deputy Nulty all the best in his term here.
We nearly have Deputy Lawlor broken in.
As I am from the horsey county, the bit is being pulled back in the mouth occasionally.
I will raise a couple of points on the Bill and I hope the Minister might take them on board. I will speak on two points only: the energy efficiency fund and energy efficiency. I will speak on energy efficiency, not from the consumers' but from the producers' point of view. I like that an energy efficiency fund will assume the Government's responsibility for providing funding for individuals to upgrade their homes. Of most concern is that there will be a choice for energy producers, in that they can get involved with the customer by increasing his or her home or business's energy efficiency or they can provide to the fund. This makes me nervous. Just as we have a public service obligation, PSO, levy, there is a fear that the cost of the moneys provided to the energy efficiency fund by the producers will be passed on to all consumers, not just to those who will be able to upgrade their businesses or homes thanks to the fund. I hope the Minister of State is cognisant that, if energy companies decide to provide funding, it should come out of their own bottom lines instead of being passed on to consumers so that the latter are not hit twice.
The energy efficiency fund invokes thoughts of something that is under way in the UK, namely, the green deal to which Deputy Boyd Barrett referred. Under that deal, energy companies supply energy efficient products to houses and businesses and businesses and consumers pay for them over a number of years. If consumers decided to switch companies or sell their businesses or houses, what would be the consequences? If we are to take the same route and get consumers to pay for energy efficiency through their energy bills, we must consider the proposal carefully so that nothing is left behind.
I wish to refer to energy producers' energy efficiency and the PSO. I do not have many difficulties with the levy, in that it is mostly a subsidy of electricity generation via renewable energy, including wind energy, miscanthus and other organic products. However, it is also used to subsidise what is probably the most inefficient source of energy in Ireland, namely, peat. There are a number of peat power stations. Approximately 50% of the PSO levy goes towards paying for power generation through the use of peat. We all know the problems associated with peat. For example, Bord na Móna has contracted with the ESB to generate power until 2017 and many peat bogs are being closed, although none is associated with Bord na Móna. When the Minister of State comes to dealing with regulations, will he consider reducing the subsidisation of peat power stations? They are less efficient, generate a greater carbon footprint and must be subsidised by other elements of the energy sector.
I welcome most of the Bill, but I ask that the Minister of State take note of the two issues I have raised.
As a fellow newcomer to the Dáil, I wish Deputy Nulty well and I look forward to working with him on trying to get the country out of this economic mess.
I thank the Deputy.
This has been a good debate on energy efficiency and the management of energy resources. I welcome the opportunity to contribute. The Bill will place an obligation on suppliers and distributors to play their part in achieving energy efficiency targets that, in turn, will assist the Government in meeting its target to reduce carbon emissions by 20% by 2020.
Good initiatives are in place. For example, many houses' attics and walls have been insulated. However, we must take it to the next step. Other initiatives mean to incentivise the installation of geothermal and solar heating elements in homes. We must examine our initiatives closely to maximise the return for individuals and the country and to achieve optimum efficiency.
The energy efficiency fund is to be welcomed and will sustain many of the programmes in question. We must constantly review them and how they will deliver for householders. It is important to acknowledge that, through the fund, the Government will prioritise low income, vulnerable households for energy upgrades.
I disagree with Deputy Boyd Barrett's denigration of smart meters. I encourage their installation in every home, but this will require that householders be educated on them to some extent in order that people might understand how best to make their electricity, gas and oil usage efficient.
I will focus on two areas. First, auto-production could lead to many efficiencies and reductions in emissions. A multinational company in an adjacent constituency to mine lies in an area with great access to renewable energy sources, namely, wind and water. However, our archaic legislation only allows the infrastructure that is necessary for auto-production to be installed on public roads by ESB Networks Limited. The problem lies in the fact that the renewable source is separated from the company in question by a public road. I hope the Minister of State's officials are listening, as numerous requests have been made to the Department to address this problem.
Legislation needs to be reviewed so that auto-production can be encouraged and renewable sources of energy can be incentivised and made more accessible to large companies, such as the one to which I referred. I am sure the officials know to which company I am referring. Access would assist the company in decreasing its energy bill and allow it to compete on the international stage. It would also reduce the carbon emissions of the company and the country. The legislation needs urgent attention. The provisions requested are already in place in respect of wind farms, but not in the case of auto-production. A balance is necessary.
Deputies referred to other sources of natural energy, for example, wind, tidal and wave. I encourage the incentivisation of new technologies in those areas.
I know of a case in which a local authority's swimming pool is separate from its head offices. The offices have a combined heat and power, CHP, plant but, for the same reasons I outlined earlier, this cannot be connected to the pool because crossing a public road would be required. These matters must be addressed.
Second, a basic heating process can be applied in every household. Various heating programmes incentivise the installation of solar, geothermal and wood pellet heating systems, but these can be expensive and technologically complicated to maintain and operate. Will the Minister and Department consider incentivising the installation of simple solid fuel wood stove burners, the likes of those made and distributed by Waterford Stanley? Each stove costs €400 and I am told by people in the IFA and the forestry sector that wood is a carbon neutral resource. It can be readily grown in Ireland and burned. Most of rural Ireland uses solid fuel. Open fires are 80% inefficient whereas solid fuel stoves are 80% efficient. For a great deal less money, the vulnerable households to which I referred — those of old people and others who have open fires — could be heated. By installing a stove for €400, someone could increase efficiency significantly and prevent heat from burning coal, turf and wood from going up the chimney.
Simple solutions are possible. I will be interested to listen to the contributions of other Deputies.
What was that company again?
Waterford Stanley, for the record.
Like my colleagues I congratulate Deputy Nulty on his great win in Dublin West and I wish him well with the work those of us on the Government side must do in the years ahead.
I welcome the Bill which for the first time will provide a legal framework which places an obligation on energy suppliers and distributors. The Bill also contains miscellaneous provisions on pension schemes for former ESB employees. The Bill will ensure the Government meets its energy efficiency targets of a 20% reduction in energy demand by 2020. This is crucial, as previous speakers have stated. A European directive exists in this area which promotes energy efficiency and the provision of energy services by energy distributors.
The Bill will restate in primary legislation obligations on companies such as the ESB and Bord Gáis and will give the Minister powers to introduce an energy demand reduction target which will specify the quantity of savings to be achieved by all retail energy sales companies and energy distributors over a period of time. Companies such as the ESB, Airtricity and Bord Gáis will be required to offer services such as wall insulation and provide help to consumers. This will be of benefit to consumers who are already put to the pins of their collars and need all the help and support they can get from energy companies.
Competitiveness and the costs associated with it have improved in commercial buildings which were upgraded through insulation, and this is to be welcomed. If companies and distributors do not sign up to energy efficiency schemes, they will have to invest money in an energy efficiency fund, and this money will replace the Government money being invested at present in schemes such as the home energy saving scheme, the warmer homes scheme and the green homes scheme. These will be consolidated into one better energy homes scheme and the companies will be required to contribute to it. These schemes are also important from an environmental point of view as a measure to reduce carbon emissions and greenhouse gas emissions in the years ahead.
The provisions of the Bill deal with the pension arrangements of former ESB employees who have moved to Gaslink or EirGrid. These changes are being included in primary legislation in case of future court cases.
With regard to energy fraud and energy theft, at present the Commission for Energy Regulation does not have the power to investigate or enter premises to check out various matters. Under the Bill, authorised officers will be able to search premises and seize evidence and this is to be welcomed. As previous speakers stated, costs of approximately €30 million are being passed on to consumers at present and any way to strengthen the regulator's powers is to be welcomed.
The Bill contains many benefits and one of these is reduced usage of energy from fossil fuels. We need to become more energy self-sufficient as each year we spend billions on importing oil into the country. It will also encourage consumers to upgrade their homes, which will reduce their energy bills. It will also ensure Ireland achieves its commitments in European legislation to provide energy savings by 2020.
Earlier this year the ESB announced it would help those in arrears and the Minister, Deputy Rabbitte, was very active in this area and must be commended. The token meters need to be rolled out to many homes, particularly those on lower incomes and household budget plans. I hope the other suppliers will follow suit.
I congratulate Deputy Nulty on his maiden speech in the Dáil and wish him well. No doubt he will be here for many years.
I thank the Deputies for their contributions to the debate today and yesterday. The debate was very constructive and well put together. Regardless of one's political party, it is clear that when legislation is in the common good, people sign up to it in terms of examining its pluses and minuses in an objective and clear way. It is clear from the debate that there is general support throughout the House for the Bill and the principles contained therein. The number of Deputies who contributed to the debate demonstrates the importance and relevance of energy issues.
A number of Deputies raised the issues of security of supply, competitiveness and sustainability. I reiterate that the overriding objectives of Irish energy policy remain security of supply, competitiveness and sustainability. These are general objectives and they resonate well with EU energy policy objectives.
We are heavily dependent on gas for electricity generation. This reliance is set to remain for some time as gas is the fuel of choice while we build our renewable capacity. I was interested in the comments made on renewable energy by the many Deputies who spoke, particularly with regard to County Mayo, which has the highest wind speeds in Europe and needs connectivity to the grid to build on that energy.
On competitiveness, analysis by the SEAI shows convergence in Irish electricity and gas prices towards the EU average. The Government is firmly committed to increasing competition as the best means of exerting downward pressure on gas and electricity prices.
I note the general welcome for the energy efficiency proposals. These provisions are already provided for in secondary legislation. By restating them in primary legislation, we will ensure the legislation is more robust. This legislation will be important in regard to delivering on our targets for energy efficiency. However, as the Minister remarked earlier in the debate, the tenor of the draft EU energy efficiency directive currently being negotiated will mean even more stringent targets for our energy suppliers of 1.5% savings per annum. This will require a significant ramping up in activity and the better energy programme is a necessary first step towards achieving the type of savings we need in the long term. The Minister will publish a new national energy efficiency action plan in the coming weeks. This will set out the key measures which we will take across key sectors of the economy to deliver on our challenging European targets.
The support of Members of the House for the provisions of the Bill is most welcome. We look forward to early consideration of the Bill on Committee Stage. I advise the House that the Minister proposes on Committee Stage to introduce a number of amendments. In this regard, amendments will be proposed to the National Oil Reserves Agency Act 2007 with regard to time limits set out in that Act, and amendments will be introduced to facilitate co-operation and the provision of information by oil companies in respect of oil contingency planning. We also propose to introduce amendments to provide for the winding up of a number of non-trading statutory BGE subsidiaries. I ask members of the select sub-committee to table their proposed amendments as quickly as possible to allow full and fair consideration to be given to them. All amendments tabled by Deputies will be considered with an open mind. The overall objective is to progress the Bill to the Statute Book as quickly as possible, and I look forward to constructive engagement with Deputies and Senators in this regard.
Question put and agreed to.