Priority Questions

Broadband Service Provision

Michael Moynihan

Question:

1. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources if he will provide an update on broadband provision; the cost of broadband here as compared to in other member states of the European Union; the progress made in providing broadband in rural areas; and if he will make a statement on the matter. [24807/14]

The Government's national broadband plan aims to radically change the broadband landscape in Ireland by ensuring high speed broadband services, comparable with high speed services available across the European Union, are available to all citizens and businesses. This is being achieved by providing a policy and regulatory framework to accelerate and incentivise commercial investment and a State-led intervention in areas where it is not commercial for the market to invest.

Since publication of the plan, investments by the commercial sector are under way and, in some instances, have been accelerated in both fixed-line and wireless high speed broadband services. Commercial operators, combined, have either invested, or committed to invest, over €2 billion in their Irish networks, delivering high speed broadband to homes and businesses. For example, eircom is rolling out a €400 million investment offering broadband speeds of up to 100 Mbps - the service is already available to over 800,000 addresses, with planned coverage to reach 1.4 million addresses by 2016; UPC has invested over €500 million in upgrading its cable network - over 700,000 homes can already access minimum broadband speeds of 120 Mbps and up to 200 Mbps, while businesses can access speeds of 500 Mbps; the ESB is engaged in a new project allowing a fibre network to be rolled-out on its existing electricity infrastructure - the company plans to establish a joint venture company to construct a fibre network directly to 450,000 premises outside Dublin; mobile operators have launched 4G high speed mobile broadband services and continue to invest in 3G services; fixed wireless operators are continuing to invest in high speed point to point wireless broadband; and the broadcaster Sky has entered the broadband market, increasing choice for consumers.

Additional information not given on the floor of the House

Of the estimated 2.3 million premises in Ireland, approximately 1.4 million are expected to be served by these commercial next generation broadband services in the coming years at speeds comparable with those marketed across the European Union. The retail prices are set by service providers in open market conditions. While these commercial developments are welcome, the acceleration of investment is largely contained to cities and towns. On 25 April I signalled the Government's commitment to a major telecommunications network build-out to rural Ireland, with fibre as the foundation of its investment under the national broadband plan. This commitment is a clear expression of the Government's determination to address the connectivity challenge in rural Ireland in a meaningful and sustainable way.

There are two issues, one of which is the cost of broadband provision in Ireland as compared to in other EU countries. Various studies and research show that the cost in Ireland is among the highest. In some instances, the cost in Ireland is four or five times higher than in some other countries in the European Union. I ask the Minister to look at this. In the past two years or so we have had many debates across the floor on broadband provision, particularly in remote rural areas. Residents in parts of County Meath which are living only 15 or 16 miles from O'Connell Street still cannot access broadband and all of the plans proposed do not seem to address that issue. Businesses across the country are looking at the cost of broadband. When everything comes down to the efficiencies that can be generated, why is the cost of broadband in Ireland so high as compared to in other EU countries?

The Deputy is correct in that there are several reports. The report on which the Department and I rely is ComReg's quarterly data review. I must make a decision on the barometer of measurement. According to ComReg, in December 2013 Ireland was 15th lowest of 26 countries in the case of fixed-lined business broadband services, six places below or 16.5% cheaper than the average; 13th lowest of 20 countries in the case of prepay residential mobile broadband services, one place above the average; and 15th lowest of 21 countries in the case of post-pay residential mobile broadband services, two places above the average. Ireland is ninth lowest of 21 countries in the case of post-pay business broadband services, four places below or 18.7% cheaper than the average; and 21st lowest of 27 countries in the case of fixed-line household broadband services, five places above the EU average.

It all depends on which report one accepts as being accurate. The other point relates to broadband speeds. Company representatives state they are not receiving broadband services, particularly mobile broadband services, at the speeds for which they signed up when they entered contracts with some companies. They are not getting what it "says on the tin". There is a major issue that needs to be addressed.

The issue of broadband came up everywhere when candidates were out canvassing for the recent elections. We need to tackle it head-on with a sense of urgency because broadband provision is fundamental to the economy. The Minister might also address the issue of speeds.

As the Deputy stated, in some cases the speeds promised are not delivered, for which there are technical and complex explanations. This is one of the reasons we have gone for a fibre solution. The roll-out of a network the foundation of which is a fibre solution means that the matter raised by the Deputy will not be an issue in the future. Fibre has the capacity to meet any reasonable demand made on it and is the Rolls-Royce of solutions. The industry is investing. When I speak about the roll-out of the fibre solution, I am speaking about the State-led intervention. Similar considerations apply to the eircom eFibre project. The industry is investing approximately €2 billion. Eircom is increasing its figures from 1 million to 1.4 million homes and from 70 Mb to 100 Mb. UPC speeds are increasing from 100 Mb to 200 Mb. As the Deputy knows, the ESB has done business with Vodafone and this joint venture is being constructed. It is a fibre solution using the electricity infrastructure. These are radical measures which will address the point raised by the Deputy.

Hydraulic Fracturing Policy

Michael Colreavy

Question:

2. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources his views on the British Government's plans to expand fracking operations in Britain; his views on whether fracking is being promoted at a European level; and if he will make a statement on the matter. [24805/14]

Michael Colreavy

Question:

5. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources if he has received any report on the environmental damage caused by flooding in an area in Colorado, USA where hydraulic fracturing has been carried out; and if he will make a statement on the matter. [24806/14]

I am most unhappy that Questions Nos. 2 and 5 have been grouped. The only commonality is that both address the issue of fracking, but if this was followed to its logical conclusions, we would have three groups of questions covering communications, energy and natural resources. I ask the Leas-Cheann Comhairle for a little leeway, given that I will be trying to cover two questions.

The Deputy is entitled to extra time.

Question No. 2 asks the Minister his views on the British Government's plans to expand fracking operations in Britain and on whether fracking is being promoted at European level and to make a statement on the matter. Question No. 5 specifically asks him whether he has received any report on the environmental damage caused by flooding in an area in Colorado, USA where hydraulic fracturing has been carried out and if he will make a statement on the matter.

It is not this side of the House which decides how Priority Questions are grouped.

It is not the Chair either.

No, it is not and I am sorry that it happened.

I was not notified until after 5 p.m. yesterday that the questions had been grouped. I did not have an opportunity to contest it with whoever the decision maker was.

I propose to take Questions Nos. 2 and 5 together.

The status of the unconventional exploration and extraction industry in other jurisdictions is a matter for the authorities in those jurisdictions and it would be inappropriate for me to comment on the government policies of other countries. We are, of course, aware of reports on last year's floods in Colorado and the public debate and controversy which ensued about concerns raised in this regard. It is important to understand the Irish environment is different from the environments in which many unconventional gas projects and operations are taking place worldwide and this must be taken into account when making reference to and comparing with experience of such projects and operations in other countries. This is why elements of the research being commissioned by the Environmental Protection Agency, EPA, will relate to specific regions where petroleum licensing options or licences have been granted by the Department or the Department of Energy, Trade and Industry in Northern Ireland. Bearing this in mind, I understand the EPA research programme will also include identification and a detailed examination of potential impacts on the environment and human health, as well as potential successful mitigation measures to counteract the impacts of such projects and operations that have come to the fore worldwide, using published reports and other sources. It is expected that findings will be accompanied by a reference to experiences in other countries where this industry is active, as well as countries where it has been banned.

The European Commission has confirmed that assessment of projects proposing the use of hydraulic fracturing in exploration for and production of shale gas, is subject to a number of EU directives, including the environmental impact assessment directive and the habitats directive. The Commission has also issued guidance in this regard. In addition to this guidance, the Commission has published a number of research documents on the potential impacts of unconventional exploration and extraction of gas, including Unconventional Gas: Potential Energy Market Impacts in the European Union; Climate impact of potential shale gas production in the EU; a report on the identification of potential risks for the environment and human health arising from unconventional gas exploration; and Mitigation of climate impacts of possible future shale gas extraction in the EU, available technologies best practices and options for policy makers.

In January this year the Commission issued a communication on the exploration and production of hydrocarbons such as shale gas, using high volume hydraulic fracturing. The purpose of this communication is to ensure the consistent implementation of environmental protection measures throughout the European Union. The guidance is implementable in member states with active hydraulic fracturing industries and the Commission has indicated that if this guidance is not followed, more binding measures will be introduced.

With regard to the position in Ireland, no applications have been made to the Department to date proposing the use of hydraulic fracturing in exploration drilling for shale gas and I reiterate that until there has been time to consider the findings of the EPA research and further research from Europe and beyond, the use of this technology will not be authorised.

On Question No. 2 on the promotion of fracking at European level, I am sure the Minister of State is very much aware of the lobbying trying to force the issue fracking onto the agenda. We need to be very concerned about what is happening in the Six Counties. If water in County Fermanagh is poisoned, it will not stop at the Border. Poisoned water does not recognise any border. Any person involved in business needs to be able to trust the partners with whom he or she is doing business. It is important to recognise that one of the companies with an exploratory licence here speaks about having extensive data from 13 vertical wells, six of which have been successfully fracked. It does not specify whether they are in the Six Counties or the Twenty-six Counties; the statement was made in the context of the company seeking investors. This is a breach of trust, which means that we need to be very careful when dealing with such companies.

I am not aware of the document the Deputy has available and if he gives me a copy of it afterwards, I will be happy to examine the issues about which he is clearly concerned. The bottom line is that the Government will not allow fracking to take place. The EPA's report will have to be to hand before decisions can be made on it. The report is at least two years away and, when published, it will have to be debated in the Houses and be the subject matter of public comment. Regardless of what companies may state, in this jurisdiction there is total clarity on what we are doing and what will not happen. There will be no fracking in this country and we will not consider any application until such time as the scientific knowledge is available to us all and fully and properly debated in the Oireachtas. The landscape of the area where the Deputy lives is beautiful and agriculture, tourism and water in the area must and will be protected. The EU regulations are very clear in this regard.

I thank the Minister of State.

Is the Minister of State in communication with the authorities in the Six Counties to ensure nothing is being done that would jeopardise industry or people's health in this part of the country?

I am surprised and disappointed that the Minister of State has not received an official report on what is happening in Colorado. The Minister has travelled to observe fracking operations in the United States. He said that in one area he did not realise fracking was going on because the place looked so well. As I said at the time, the Minister needs to talk to people other than the companies involved or the official environmental protection staff. It is disappointing that a major flood in Colorado caused serious environmental damage. It took them three weeks to get in to some parts to check whether the ground water had been poisoned.

The potential impact here is serious. A groundwater survey undertaken in Ireland showed that the most vulnerable places are the very ones for which fracking licences have been sought. They are the most vulnerable areas for possible water contamination. If the Shannon gets poisoned, we will all be in trouble.

I want to reassure the Deputy that the EPA study is examining each and every issue that he has raised. It is also looking at other jurisdictions where fracking has taken place and where there have been incidents. All of that scientific knowledge will be included in the examination.

I have a report on what happened in Colorado. If the Deputy wants me to read it out, I will certainly do so. It states that there are 20,000 oil and gas wells across the county where it happened. Some 1,900 of those had to be closed off as a result of the flooding. State officials advised that, as regards oil and gas infrastructure, the damage was limited. No wells failed during the flood and they responded quickly to minimise any spills or contamination from broken pipes or damaged storage tanks. They laid out floating booms to absorb and contain oil slicks.

I want to reconfirm that we have no applications proposing the use of fracking and no such applications will be considered until we have seen the outcome of the EPA's research.

As regards the place referred to by the Deputy as the Six Counties, I presume he means Northern Ireland, where his party is in a power-sharing administration. As I understand the communications between the people there and our Department, they are part of this fracking study as well. In other words, the Environmental Protection Agency study is for both North and South. The Northern Ireland Administration is also involved in supporting and funding this research. I think it is very positive that we will have an all-island report to inform everybody about the facts.

Is the Minister of State happy that there are no fracked wells in the Six Counties?

I will be happy to have the Deputy's report examined for clarity on that issue.

Could I have a copy of the report the Minister of State has from Colorado?

Yes, of course.

Question No. 3 was tabled by Deputy Finian McGrath. He is unable to attend the House and has conveyed his apologies. We will therefore proceed to Question No. 4 in the name of Deputy Moynihan.

Question No. 3 replied to with Written Answers.

Energy Prices

Michael Moynihan

Question:

4. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources if he is concerned at the continual rise in energy prices; the total revenue paid by EirGrid to wind energy providers in 2013 and to date in 2014; and if he will make a statement on the matter. [24808/14]

Is the Minister for Communications, Energy and Natural Resources concerned at the continual## rise in Irish energy prices? What is the total revenue paid by EirGrid to wind energy providers in 2013 and, to date, in 2014, and will he make a statement on the matter?

While I have no statutory function in either the regulated or non-regulated markets, I am acutely conscious of the impact of energy prices on citizens across the country. Responsibility for the regulation of the retail electricity and gas markets is a matter for the Commission for Energy Regulation, which is an independent statutory body. Prices in the electricity retail market are fully deregulated, and it is similar for gas, except in the case of BGE tariffs for domestic consumers. These BGE retail gas tariffs, however, will be deregulated from 1 July 2014.

Electricity and gas costs in Ireland are influenced by various drivers, including global gas and oil prices, the costs of capital, exchange rate fluctuations, the small size of the Irish market, geographical location and low population density. The most important factor affecting electricity prices in Ireland is the continuing high wholesale price of gas to Ireland.

Diversifying the fuel mix used in electricity generation can help to mitigate the impact of volatile fuel prices. The promotion of renewable energy by displacing imported fossil fuels can play a critical role in this regard. To date, wind energy has proven to be the most commercial technology in the Irish market. However, electricity generated from a range of renewable sources including water, biomass and landfill gas are also supported.

There are significant economic benefits already accruing to Ireland from the supports for renewable energy. A report published by SEAI last week found that in 2012 the use of renewable electricity resulted in greatly reduced use of gas, coal and peat, to the value of an estimated €245 million, and prevented the emission of 1.9 million tonnes of CO2, which saved a further €15 million.

The alternative energy requirement and the renewable energy feed-in tariff, to which the Deputy referred, are the primary means through which electricity from renewable sources is supported in Ireland and are funded from the public service obligation, PSO, levy. In the 2012-2013 PSO period the cost to the PSO of the two schemes amounted to €54.6 million, and the equivalent value for 2013-14##, as estimated by the Commission for Energy Regulation, will be €43 million.

I thank the Minister for his reply. I am not sure if the Minister is aware that the UK's energy regulator recently wrote to the large power suppliers in Britain seeking an explanation for the fact that fuel bills had not decreased, given the decline in wholesale gas and other energy prices. We have constantly discussed this matter here when the energy regulator grants increases to energy suppliers following an increase in wholesale market prices, but there is now a decrease in wholesale market prices. I understand that the regulator is on a statutory footing, but the Minister is ultimately responsible to the House for these issues. It is time to arrange a meeting between the Minister and the regulator to ensure that energy suppliers are called in, hauled over the coals and asked why the reduction in wholesale energy prices has not led to lower fuel bills.

I am aware of Ofgem's public statement in Britain. In addition, I have noted the comments by Ofgem's chairman, who is the former chairman of our own Commission for Energy Regulation. The situation is not directly analogous; the main driving force here is the wholesale price of gas, over which we have no control. I take the Deputy's point that I am ultimately accountable to the House but, unfortunately, gas prices are not within my control. I can list for the Deputy what the regulator is focusing on.

As it happens, I met with the regulator last week on this issue. I expressed concerns similar to the ones the Deputy has just articulated. I subsequently wrote to the regulator setting out my views. Unfortunately, however, exchange rate fluctuations, the small size of the Irish market and the extent to which we are reliant on gas to generate electricity are issues that are also outside the regulator's control.

The issues on which the regulator concentrates are putting in place energy efficiency measures, creating the framework for competition in the market, including regulatory structures, and seeking to move away from a reliance on high-priced imported gas with its volatile and sometimes high prices towards a greater diversity of fuels used in electricity generation. The Commission for Energy Regulation scrutinises network costs for both transmission and distribution which form part of final retail electricity prices. I should say that is the focus of Government policy.

The Minister met with the Commission for Energy Regulation recently. Did the public service obligation, PSO, and the possible increase in October come up at the meeting? Could the Minister offer an opinion in that regard?

It is a classic case that when the cost of oil goes up it is immediately reflected in the price at the pumps but when the price of oil goes down it takes months for the retail price to reduce due to storage and other issues. I accept the explanation is complex. We are aware that when the wholesale price goes up the retail price goes up and it is time to address the issue.

On renewables and efficiencies in the sector, have the Department and the various stakeholders examined the issue in terms of future renewable energy projects?

I beg the Deputy's pardon. I missed the point.

Given the various subsidies available for renewable energy production, have the stakeholders considered such projects and their sustainability? It is grand while the subsidies are available but what will happen when they are no longer available? This might be my last occasion to debate Priority Questions across the Chamber with the Minister, Deputy Rabbitte, in this portfolio. I wish him the best of luck in the future.

I thank the Deputy very much. I may need it. In response to his point on renewables, Deputy Moynihan will be interested to examine the SEAI report on renewables which I published on Monday morning of this week. The SEAI considered what savings accrued in 2012 as a result of the supports for renewable energy. It concluded that savings of €245 million were realised. If one adds to that the 1.9 million tonnes in CO2 emissions that were avoided, that added a further €15 million in savings. REFIT applies over 15 years. The idea is that the situation will normalise and find its own place in the market over that time.

A further study is due to be completed very soon that involves the ESRI, the SEAI, EirGrid and the Department. The quadrilateral study is focusing on precisely the question Deputy Moynihan raised and it will be very interesting to see the results of the study.

I did discuss the PSO with the regulator at the recent meeting. There are three elements to it; the renewables element, which includes the peat-burning stations in the midlands. Successive Governments have made the calculation that there is a public interest in maintaining such employment in the midlands. A contract will expire next year that was entered into in 2005 when the country was on a knife-edge in terms of energy adequacy in respect of Tynagh and Aughinish. That is a factor as well.

Question No. 5 answered with Question No. 2.

Go raibh maith agat. We now go on to Other Questions. Questions Nos. 6 and 11 are grouped together.