I welcome Mr. St. John O'Connor, principal officer in the Department of Communications, Energy and Natural Resources, and Dr. Brian Motherway of Sustainable Energy Ireland to discuss the national energy efficiency action plan.
National Energy Efficiency Action Plan: Discussion.
Mr. St. John O’Connor
I thank the committee for affording us the opportunity to report the progress being made on the national energy efficiency action plan, NEEAP. I am joined by Dr. Brian Motherway from Sustainable Energy Ireland, SEI, who has been actively involved in the preparation of the action plan and is here to answer any technical questions that members may have.
As the committee will be aware, an energy efficiency action plan was transmitted to the Commission to fulfil our EU commitments in September last year. It forms the basis of the draft NEEAP, which was subsequently published as a consultation document in October last year. Some 42 submissions were received from businesses and members of the public, all of which have been fully evaluated and taken into account.
In a recent review by the European Commission of member state action plans, Ireland's plan was identified as being one of the most advanced, providing, as it does, a clear framework for the achievement of the identified measures and actions. The Commission held up a number of initiatives, including Power of One, the national energy efficiency campaign, as exemplars in their field. We are cognisant of the need to ensure that the draft NEEAP not only reflects the positive work done to date, but also seeks to extend it further.
I am pleased to inform the committee that the draft NEEAP is now at an advanced stage, following intensive work over the summer months. The Minister expects to be in a position to circulate the revised plan to Departments in the next couple of weeks, with the intention of bringing it to Government soon thereafter.
The draft NEEAP is designed to realise two overriding objectives, first, providing the framework to meet our energy efficiency targets as set out in the energy White Paper and, second, meeting the energy services directive, ESD, targets, which require Ireland to achieve 9% energy efficiency savings by 2016. In addition, our identified measures will have commensurate emissions savings.
At national level, we have committed to achieving a 20% reduction in our energy usage by 2020. The White Paper also commits the public sector to act as exemplar in the area of energy efficiency and sets a more challenging target of 33%. Since submitting our action plan to the Commission, we have worked to bring the actions and measures into existence. The NEEAP not only identifies a clear roadmap towards achieving energy savings by 2020 but also focuses on low-income households and recognises the need to have a co-ordinated approach to delivery.
Many of our identified actions are difficult to measure, which is not unusual for such plans. We have adopted a conservative approach by not including them, as yet, in our savings projection. As our modelling capability improves over the coming years, we will be in a position to incorporate greater savings from existing identified measures and actions.
The draft NEEAP represents a first step in an iterative process that will result in further action plans being submitted to the Commission, as part of the ESD process, in 2011 and 2016. We are taking an aggressive approach to the clear identification of our national targets and setting out a path towards their achievement with the publication of the NEEAP in 2008.
Fundamental to achieving an energy efficiency target is creating structures that effectively underpin the identified measures. For this reason, we will convene two working groups, the first to drive and co-ordinate the achievement of the overall targets and the second to drive the achievement of the 33% target set for the public sector.
One of the key elements of the draft NEEAP will be the requirement for public sector organisations to publish energy efficiency action plans annually. And although we have yet to publish the NEEAP, we are actively working to ensure that, as soon as it is published, we will be in a position to provide effective guidance and reporting templates to public sector bodies.
The draft NEEAP follows a similar structure to the consultation document that was previously published, albeit with an increased focus on affordable energy and the need to ensure there is a coherent and cohesive approach to tackling this issue. We will take the opportunity, with the publication of this document, to identify the scale of the challenge that faces us, to highlight current interventions by Government and to point the direction for the future. The warmer homes scheme is an important mechanism for ensuring that low-income homes are warm and comfortable this winter. In this regard, the doubling of the allocation for the scheme in 2008 to €5 million was a welcome development.
Given the current high price of oil, we expect that the economics for further actions in the transport sector will become even more persuasive and this will undoubtedly add to our energy savings. Likewise, the imperative of meeting Ireland's carbon emissions targets will help incentivise the formulation of actions and measures that will also serve to assist us in achieving our energy efficiency goals. We have taken the conscious decision to reflect savings in both energy efficiency and carbon emissions terms. We will report on both to the Government.
As with the consultation document, the draft NEEAP sets out the extent of the energy efficiency targets to be achieved. To calculate our energy efficiency savings, we are using a methodology consistent with the ESD to align ourselves with the reporting requirements therein. The ESD takes as its reference point the most recent five-year period for which statistics are available, which is from 2001 to 2005.
For the committee's benefit, I will elaborate on some of the key measures and actions contained within the draft NEEAP. The built environment is projected to contribute more than two thirds of projected energy savings. These savings are to be achieved by a combination of policy instruments in both residential and non-residential buildings, in new-build and existing stock and through both energy efficiency and renewable energy. The introduction of mandatory building energy rating is making energy and carbon performance a visible factor influencing developers, owners, prospective sellers and renters, as well as prospective buyers and tenants. We believe that from 2009 this will increasingly influence purchasing behaviour.
The Minister for Communications, Energy and Natural Resources, Deputy Eamon Ryan, launched the pilot home energy efficiency scheme earlier this year, which incentivises householders to improve the energy efficiency of older housing. Incentive programmes such as this and the greener homes scheme stimulate significant investments in sustainable energy by home owners.
The Minister also announced earlier this year the low carbon homes programme to be administered by Sustainable Energy Ireland, and designed to accelerate the adoption of very low energy and low/zero carbon building energy standards through a future revision of the building regulations. The programme supports developers to build homes that are at least 70% more energy efficient and produce at least 70% less CO2 than homes built to the 2005 baseline standard.
The programme aims to achieve its objective by building an evidence base to support a policy decision by the Government to amend the building regulations to make this higher standard mandatory. Sustainable Energy Ireland's house of tomorrow programme successfully used a similar approach and is credited with heavily influencing the decision of the Minister for the Environment, Heritage and Local Government to make the building regulations 2007, which introduced a standard some 40% better than the 2005 baseline.
The Minister for the Environment, Heritage and Local Government, Deputy John Gormley, has signalled his intention to review the building regulations again in 2010 with a view to increasing the standard to 60% over the 2005 baseline, with an ultimate aim of achieving a zero carbon standard for new houses in the earliest possible time thereafter. A home built to the standard of the new programme is expected to have a BER rating of A2 or better. By comparison, a home built to the standard of the 2007 building regulations typically has a BER rating of B1/A3.
An exciting initiative to support efficiency of end-use by final customers is the roll-out of smart meters. Following on from commitments given in the programme for Government and energy policy framework to improve management of demand for electricity and achieve greater energy efficiency through use of the latest technology, the smart meters project aims to reduce electricity demand at peak times through time-of-use tariffing. Smart metering is also being introduced on a pilot basis within the gas supply sector. This all-encompassing approach to energy metering aims to improve overall energy efficiency through changes in customer behaviour resulting from awareness of amount of usage and, in the case of electricity, the actual real-time cost of usage.
For business, the accelerated capital allowance scheme allows for the write-off expenditure on three categories of energy efficiency plant and equipment in the year of purchase. A comprehensive evaluation process has been undertaken by Sustainable Energy Ireland and we believe it will play an important role in achieving our 2020 target.
I will highlight some of the actions and measures that are contained within the draft NEEAP, but are not yet taken into account. This is because they are at early formulation stages and have not been developed to the extent where it is possible to quantify the potential energy or carbon emission savings.
One such action which holds significant potential is the introduction of an energy efficiency supplier obligation scheme which would confer an obligation on energy suppliers to effect energy savings among end users. A working group, involving the Department of Communications, Energy and Natural Resources, the Department of Finance, the Commission for Energy Regulation and Sustainable Energy Ireland, has been established to bring appropriately costed and evaluated proposals to the Minister. A similar scheme has operated in the UK for many years and has resulted in substantial savings equivalent to the emissions from 700,000 households each year and stimulated investment by energy suppliers in carbon reduction measures of about £2.8 billion.
Green procurement is another area where significant potential exists. Public services contract for over €10 billion each year. If we can leverage procurement towards energy efficient products and services then we will go a long way towards achieving our targets. International experience with green public procurement has demonstrated the energy savings and environmental benefits. A research project co-funded by the European Commission to assess the potential benefits of green public procurement suggests that if all public authorities across the EU were to require more energy-efficient computers, leading the whole market to move in that direction, savings of 830,000 tonnes of CO2 could be realised annually.
I thank the committee for the opportunity afforded to me this afternoon to update it on progress towards publication of the draft NEEAP.
I am looking forward to the publication of the policy document. This month there are 10,000 more people unemployed and this was the coldest September in 15 years. This year energy poverty will become an issue for many households. We have a responsibility to examine climate change issues in which energy conservation can play a large role. In addressing that problem, we need to examine the day-to-day issues concerning the affordability of energy. Many people do not have a grasp of the detail of how they can save money through conservation. Will the delegation address that issue?
The concept of smart metering makes much sense in that people will know how much they are spending and how much power they are using, leading them to use power at the most cost-effective times of the day. I support this principle but smart metering was supposed to be more than this. It was supposed to provide an option for households, farms and businesses with microgeneration capacity to sell energy back to the grid. It is unclear whether the current smart metering pilot programme can provide that service because there is not a tariff system to sell energy back into the grid. The Department must provide some clarity on this issue.
What is the Department doing to lead by example in green procurement? What has been undertaken by the Department in the past year to switch towards a more green purchasing policy?
There is an initiative in the draft partnership agreement on public procurement and the role of small suppliers in that. Has the Department any interaction with that initiative in procurement? How does it intend to get its green procurement policy to feed into it before the partnership deal is finalised?
The committee has heard much about smart metering in the past year but there are still no smart meters in place. When one is installed in a household, will it be evident how much money the household is spending on electricity? Will the information it gives on appliances and electricity use be easily understood and apparent?
Mr. St. John O'Connor proposes to send a draft of the policy document to the Cabinet. Will he send one to the committee too for its input?
There is always a danger that once a plan is prepared, people feel the job is done. Everyone can suffer from that syndrome. The original draft plan was sent to Europe in 2007 and received nice compliments. What has happened since then? While I accept the plan has yet to be published, what is the baseline concerning the 9% reduction? Recently, the EPA found the figures for Ireland's carbon emissions were almost double what was originally thought. That does not engender confidence. It means all plans for carbon reduction were completely out of kilter. What progress has been made in reductions considering the target date of 2106 is a tight timeframe? What is the evaluation system? How is this being done? How may we see results? Are there any results to see? I am not sure whether green procurement will be mandatory or what is its status. To echo the point about low income families, thousands of them are living in poor, sub-standard accommodation, whether council or privately owned. It is clear to me that many of the initiatives being taken or pilot schemes are all very well, but they are simply scratching the surface. If we are to improve energy efficiency, particularly to meet the needs of those most directly affected by the inefficiency of their accommodation, we must have a really robust retro fitting programme for these buildings and houses, with a particular focus on insulation.
I do not know whether costings have been done on what is involved in terms of both the targeted insulation programme and a national one. I appreciate the point that more insulation does not automatically mean that less energy is being used, but it nonetheless seems to be a simple and effective way of at least opening up that possibility.
Is there a figure in terms of the investment required to ensure that there is a 33% improvement in the public sector? That is such an incredible ambition, that if it is to have any real meaning it must be scientifically worked out, in a very detailed fashion. We are talking about an enormous number of schools, for example, that need to be retro fitted. Children in pre-fabs are hardly being educated in energy efficient buildings. Perhaps the Department might tell the committee about all the basic analytical work being done on that, because the emphasis with regard to energy rating is very much in the new-build area. That is manageable and it is understandable, but not many houses for today or tomorrow are being built at the moment, and it does not look as if they will be for some time. Empty houses, in any event, are very energy efficient because nobody is living in them. Really, what we are talking about is a much more difficult problem, namely, the existing built environment being upgraded and improved.
I noted in the efficiency plan that a transport impact analysis was being done. Perhaps the Department might say if that has been completed. My last point concerns micro generation. I and a number of other Deputies attended a presentation by the IFA, which is looking for some financial support to develop micro-generation on farms. One of the ideas that it seems is being promoted is that micro-generation will lead to greater efficiency. How much study has been done to see exactly what the return is, because if it is a good one, then it obviously makes sense to assist - whether industry, farmers or whoever - to engage in this? However, if it is not worthwhile, then perhaps we should concentrate on what works.
Before I call on Senator Coffey, will the Department explain to me where these targets of 20% and 33% come from? I hear these targets being thrown out all the time, and it is obvious now that they are not based on any scientific evidence. We are setting targets that we do not know can be achieved. As Deputy McManus has said, we have suddenly discovered that we have twice the emissions we thought we had. To give an example, as regards this 33% for the public sector, I have yet to see any plans. I have been trying to establish from the Ceann Comhairle what the plan is for Leinster House, for instance, and what strides are being made, even down to switching off lights. One goes around the House and there are lights on all over the place. As Deputy McManus has said, let us lead by example here. Is there a basis for this 20%, and the 33% figure, or is it just top of the head stuff to the effect that we just set a target and see how we get on? Is the target by 2020 linear - 10% for the last five years, say, 15% for the first five and so on - or what is it? How can we measure whether we are on target? To give another example, the Minister for Transport was in here and the committee asked him whether he would direct the public transport companies to have a plan to change over to energy saving vehicles - trains, buses, boats or whatever. Unless people are directed I do not see any action taking place. That is why I believe that legislation should be passed which will put legal obligations on people to do certain things. Persuasion does not seem to be working, as things are.
I shall be as brief as possible. Some of the issues I wanted to talk about have already been raised, but I shall just mention them, anyway. As regards the smart meters, it is folly just to depend on the installation alone. A whole cultural and behavioural change must take place. Are any resources going towards the education of householders where those smart meters will be installed? Ultimately, they are merely recording devices to tell people what is being used. To give people a proper understanding of their purpose, some level of education and awareness is needed if this is to be a successful pilot project. I also want to ask about the exporting of energy back to the grid from micro-renewable energy sources. If we are serious about becoming energy efficient in our homes and businesses, there should be some facility or tariff structure that will allow people to export unused or excess energy back to the grid. That would certainly hit home as people will naturally home in on initiatives that affect their pockets. I suggest this is an avenue that should be further explored.
I agree with Deputy McManus on the issue of renewable energy sources on farms. The IFA and its members are anxious to examine investment in this area, but incentives are needed. A capital allowance scheme exists for business. Correct me if I am wrong, but I do not believe one exists for farms or farmers, who probably have resources and are willing to invest in this area. Perhaps the Department could clarify the position on that.
On the building energy rating, BER, certification, I understand there is some confusion in this area at present. While it is laudable that we now have to certify housing for energy ratings, unfortunately, as Deputy McManus said, we have probably missed the boat because the housing boom is over. The whole certification process needs to be made clearer. What assessing body, for example, certifies the assessors who issue the BER certificates? Which enabling body monitors the assessors to ensure they are competent and manage their systems properly? It is broadly similar to the electrical industry. If a householder needs certification for a wiring or rewiring installation he or she applies to the independent body, RECI, the Register of Electrical Contractors of Ireland. In the case of BER certificates, architects and engineers are self-certifying, so that there appears to be something of an anomaly there, which the Department might clarify. Again, the whole certification process needs to be clear in people's minds so that they can have confidence that it is being properly managed and monitored. Thousands of existing houses will go on to the private rental market and they will require energy certificates.
What is happening to local authority housing stock? Has any thought been given to this area, because obviously the local authorities have a good many roll-over tenancies? Who, within the local authorities, will be responsible for that whole area? It has not been properly thought out, although I am open to correction. The whole certification process on building energy rating has not been properly thought out as regards monitoring competencies, enabling bodies and independent ratification. It is critical to the success of energy efficiency that this certification process is transparent and managed properly.
Would Mr. St. John O'Connor like to answer the questions? I will then call other speakers.
Mr. St. John O’Connor
If the committee is agreeable, I will split the questions with Dr. Motherway, who will discuss the smart meters and the building energy rating. I will address the questions in the original order.
Deputy Coveney referred to low income households. The primary mechanism remains the welfare system in which there are at least three different allowances. On the Department's side, the main intervention is via the warmer homes scheme. At a conservative estimate, more than 18,000 interventions have been made in terms of attic insulations, lagging jackets and so on since the scheme began.
Deputy McManus asked about the data on interventions required and I have relevant statistics. Sustainable Energy Ireland has done research in this area and we have commissioned it to carry out a review of the warmer homes scheme, which we will consider with interest. In addition, as far as I am aware, the ESRI is also due to publish a paper on low income households this year or early next year.
Is Mr. St. John O'Connor aware that at present local authorities are installing oil-fired central heating in council houses?
Mr. St. John O’Connor
We have been talking to the Department of the Environment, Heritage and Local Government about this and I understand the situation is under review.
It is crazy. I apologise for interrupting. Mr. St. John O'Connor should proceed.
On the issue of low income households, has any exercise been carried out? Instead of increasing the fuel allowance to an inefficient house, would it not be cheaper to upgrade the house and get better value for the existing fuel allowance? What should we do? Do we double the allowance and let the fuel go out the window or through the walls, or do we invest to make the house more efficient? Is any programme anticipated in the Department of Communications, Energy and Natural Resources to roll out a plan over the next year or two, especially as more people are now unemployed and could be trained and employed to make homes more efficient?
Mr. St. John O’Connor
The warmer homes scheme will remain the primary mechanism in that regard. The scheme works off community-based organisations which use FÁS resources to retrain individuals to do this work. Again, I cannot comment on budgetary issues - that is a matter for the Government - but the warmer homes scheme is the primary mechanism for my Department in this regard.
I want to clarify some points with regard to green procurement. While it is ultimately the responsibility of the Department of the Environment, Heritage and Local Government, SEI has been examining this very actively as an issue because we believe potentially huge savings can be made. We are looking at producing guidelines on green procurement and indicative figures which we can use to educate public sector bodies. Likewise, we would envisage that once the Department of the Environment, Heritage and Local Government is able to transpose the relevant legislation, it will be working with us through the public sector working group which will be set up under this action plan to drive green procurement through the public sector. We have begun work already on producing guidelines and reporting templates for public sector organisations. However, first and foremost, it is the Department of the Environment, Heritage and Local Government which will produce this.
Dr. Brian Motherway
I will deal with the various questions on smart metering and the microgeneration dimensions as well as the questions on building energy rating. The national smart metering trial is under way at present and members might have seen the recent announcement. The scheme is co-ordinated by SEI, the Commission for Energy Regulation and ESB Networks in conjunction with the various energy suppliers. Over the past year ESB Networks, which is responsible for and owns the meters in all our homes, underwent a procurement process to buy several different smart metering technologies to use in the trials over the coming period. The trials will split between behavioural trials and technology trials and will cover approximately 20,000 meters in homes over the coming period.
The behavioural dimension has moved into the public engagement stage. ESB Customer Supply recently wrote to approximately 50,000 of its customers to invite them to participate in the behavioural dimensions of the smart metering trial. I am pleased to say take-up was very quick and in the space of a few short weeks we have already recruited approximately 8,000 customers who have expressed their willingness to participate in the smart meter trials. We will work with these 8,000 people on the behavioural dimensions and will test different versions of in-home display that provide different types of information.
Some people will have lighter information and some will have more detailed information. We will follow up with educational materials, web-based materials and leaflets for some. In the spirit of the trial, we will be testing the behaviour impacts of the different communication techniques from lighter to stronger ones. This will include time-of-use behaviour, including incentives to move away from using energy at peak times, and also overall energy demand and whether there is an impact in terms of people becoming more efficient in their energy use.
In parallel, other households will be engaged in a technology trial where ESB Networks in particular, with the suppliers, will test the back office communications, data handing and all that goes with smart metering. As I am sure the committee will appreciate, each of our meters at present gives one reading every two months and this is the data that is handled by the central systems, whereas the new smart meters being installed will give a reading every 15 or 30 minutes. This creates a much larger dataset that has to be handled nationally and by all suppliers. All this is being tested in terms of communications, data systems, billing systems and so on.
There is a microgeneration component to this. All the smart meters being purchased and about to be installed will have the capability to handle export via microgeneration. We will be testing microgeneration dimensions in parallel with the core smart meter trial.
SEI for the past year or so has been running a small trial on microgeneration from micro combined heat and power units in small commercial installations such as nursing homes and small offices, and it is collecting data from that trial. There are two new schemes that will add to this data in both the technical and the commercial elements of microgeneration in conjunction with smart metering. One is the microgeneration commercial arrangements trial which the Minister launched via SEI earlier this year which will test approximately 50 microgeneration units in domestic and small commercial operations, including photovoltaic, micro CHP and micro wind turbines. They will be tested in terms of the technology of feeding the readings back into the system and testing the commercial arrangements.
In addition, the low carbon homes programme, to which Mr. St. John O'Connor referred and for which we have now launched a call for expressions of interest among developers, will be asking developers to build homes close to zero carbon standards, which will by necessity involve a microgeneration component. We will be connecting those participants with the smart metering trial and testing the commercial and technical aspects of microgeneration in those homes in conjunction with the smart metering.
On the question of building energy rating, SEI is the body that certifies people who carry out the assessments and it is the repository of all the assessments. We certify training courses and the qualifications systems for people who want to become assessors, and people register with us to become qualified assessors and to be entitled to carry out these ratings in the market. They then deposit the ratings with us and we carry out spot check audits and overall data monitoring of the ratings.
As the committee will appreciate, we are in the nascent stages of this in that the rating is only fully in place for new homes since the middle of this year. We have a few thousand ratings lodged with us and close to 1,000 assessors registered. We are now moving on in earnest to the existing homes dimension which comes into effect from 1 January 2009. We are preparing both the software and methodologies for carrying out ratings on existing homes and also the training qualifications and certification processes for the assessors who will carry that out. In the next fortnight, we will release the official methodologies and software package for assessors to carry out ratings in existing homes.
Is self-certification allowed? For example, where an architect has designed a house, can he or she certify it?
Dr. Brian Motherway
It must be done by a qualified building energy rating assessor. There are rules regarding conflicts of interest, so I cannot answer the Senator's question in the generality. It depends on the specific details of the case whether a conflict of interest may arise. Our quality assurance system involves us undertaking spot-checks on all assessments across the board.
How much value is there in encouraging microgeneration? Dr. Motherway said SEI is collecting data, but I presume other countries are way ahead of us on this. Certain other actions seem to offer far more benefit for the investment involved. Does microgeneration provide a satisfactory return?
Dr. Brian Motherway
It is our opinion that the technology is still not fully mature. There is a degree of future readiness involved and we are strongly of the view that our systems should be capable of accommodating, technically and commercially, those who wish to generate their own electricity. The results of international trials have been mixed. Some states are of the view that microgeneration is ready for large-scale roll-out while others contend it will take several more years. Our detailed opinion will be available soon, with the various trial dimensions that are under way. We will be able to give a more robust answer to the Deputy's question in the coming months.
To explain the background without getting too technical about the way the targets are set, the method for defining the energy efficiency targets is set out in the EU energy services directive. A sub-committee charged with overseeing the implementation of that directive is currently finalising the details of how it will be monitored and reported in the future. In terms of how the targets are set in the first place, the method is to take a five-year reference basis for energy consumption in a given member state.
We are in a good position in this regard in terms of the data available to us. SEI's energy policy statistical support unit is a repository for energy usage data and has developed a good time series over several years of our energy usage across sector and across fuel. By averaging five years to ensure representivity, we create a baseline year for our energy usage. Our target then is to identify measures and actions that will lead to the reduction of energy usage against a business's usual scenario of 9% of that baseline. In other words, when one counts up the measures and actions the State takes and measures its savings initially as projections and ultimately as measurements after the facts, the savings delivered by those measures and actions should amount to at least 9% of energy usage in the reference year.
Which is the reference year?
Dr. Brian Motherway
It is the average from 2001 to 2005. Taking those five years and dividing by five provides the baseline reference year for the energy target. A similar method is used for the 20% and 33% targets set out in the White Paper on sustainable energy. We use the same methodology for calculating the targets, although the numbers are different. One distinction I would make is that the energy services directive at European level does not include energy usage associated with the emissions trading scheme, whereas the targets set out in the White Paper on sustainable energy cover the entire energy usage of the economy.
What progress are we making in regard to those targets?
Dr. Brian Motherway
It is early days. However, in respect of the national energy efficiency action plan, which was published in draft form and submitted to the EU last year, the measures in place and being put in place seem to be robustly adequate to meet the energy services directive target of a reduction of 9% by 2016. At this point, further analysis is required to determine whether all the measures are in place to deliver fully on the 20% target for 2020. That will be examined when the new national energy efficiency plan is discussed.
Who is responsible for checking our progress in meeting these targets? Is that the responsibility of the Department?
Mr. St. John O’Connor
The Department and SEI will function as the repositories for the statistical information. However, it is the interdepartmental implementation committee that will drive the achievement of those targets and bring appropriate measures and actions to the Government.
Will there be an annual report?
Mr. St. John O’Connor
Each public sector organisation will have to produce an energy efficiency action plan and we will produce reports on progress in this regard. We must produce an interim report for the Commission in 2011, so we may align the reports with that. However, it is for the implementation committee to decide the frequency and format of its reports.
Will the Department provide an annual report to this committee on progress made in achieving the targets?
Mr. St. John O’Connor
Again, it is a decision for the committee as to how often it will report. If I may, I will hold off until such time as--
I am asking, as Chairman of the committee, that Mr. O'Connor arrange that we receive a report. There is no point in setting targets if nobody knows whether they are achievable. A requirement to report to this committee would provide some impetus and clarity. For example, substantial funding was expended on the Power of One campaign. Do we know what savings have been made as a result of that campaign?
Mr. St. John O’Connor
We have information on the degree to which it has resulted in behavioural changes. I do not have those figures to hand but I can certainly make them available to the committee.
I ask Mr. O'Connor to do so. Has the campaign been successful?
Mr. St. John O’Connor
Yes. Even in terms of the savings it demonstrated people can make, it has been hugely successful.
It is a good campaign. However, my point is that it is important that people should know what progress we are making. Confirmation of success can encourage further effort and even greater success.
Mr. St. John O’Connor
Absolutely.
My point is that as an all-party committee, we provide a forum where those charged with monitoring progress on this issue can be asked to explain to us why we have missed our targets on emissions and what is being done to correct that. Does Mr. O'Connor understand my point?
Mr. St. John O’Connor
Yes.
I ask that the Department write to us confirming that we will receive an annual report on the progress made on the targets we have set, including the 33% target for the public sector. If we are doing well, congratulations will be in order. If not, we will ask why that is the case and I am sure we will receive an answer. I look forward to receiving Mr. O'Connor's confirmation that we will receive these reports.
Will the delegates respond to my question on the capital allowance scheme which applies to businesses? Is there any scope for farmers in regard to microgenerators and renewables? Are the delegates of the view that this is worth exploring?
Dr. Brian Motherway
The capital allowance scheme as set out in the Finance Act 2008 applies to all limited companies. By its nature, it functions as an incentive in terms of writing down investment against corporate taxes. In other words, it is geared towards those who pay corporation tax. The technologies it covers relate to motors, lighting and building energy management systems and the incentive is for those who buy a much more efficient than average version of these technologies. However, I take the Deputy's point. We are interested in the potential for microgeneration in farming. There may be opportunities for the farming community in regard to the various trials we are now undertaking.
Mr. St. John O’Connor
Deputy McManus asked about the sustainable travel and transport action plan. I understand this plan is nearing completion and that an announcement is imminent. I am not directly involved in this project, although we fed into it and it fed into the national energy efficiency action plan. Therefore, some of the same measures will be contained in both.
Regarding the existing environment, the committee will be aware that the Minister launched the home energy saving pilot scheme earlier this year, ahead of a wider roll-out for 2009. It is designed to incentivise householders to achieve energy efficiencies in order to address the problem of homes with poor energy efficiency standards. We are confident this will be a strong measure to improve energy efficiencies. It also will be included in the national energy efficiency action plan, NEEAP, once it is published.
We should arrive at a stage where one can show average households the savings in money terms that can be made if one does X, Y and Z. People nowadays are becoming highly cost-conscious, particularly in respect of rising heating costs. An advertising campaign could be used to set out what the savings would be were one to do X, Y and Z in a typical three-bedroom house and the Department could stand over those savings.
Mr. St. John O’Connor
I wish to make two slightly cheeky comments in this regard. First, I encourage everyone to visit the Power of One website, on which the savings are demonstrated. Second, I refer to the Power of One campaign in respect of space heating that we are about to kick off for the winter months. It will demonstrate the savings to be made by, for example, turning off lights, switching to A-rated appliances, turning down a thermometer, etc. There has been a conscious decision to switch the message to identifying the savings people can make by taking simple actions. That point is well made.
Does it also include the average cost of carrying out, for example, insulation work or what people should expect to be obliged to pay?
Mr. St. John O’Connor
It does not but they will receive such information as part of the home energy savings scheme.
Could it be included in an advertising campaign? They then would have an idea that doing X, Y and Z would cost €1,000, whether they could afford it or to aim for it and where and to whom they should go. One must keep giving people such information. I do not have a clue how much it would cost. People could be told what was the average cost, what they should be paying or about the qualifications of the individuals who would carry out this work.
Mr. St. John O’Connor
In the context of the home energy savings scheme and on the SEI website, there is a wealth of data. Anyone who is interested in applying for a grant to perform work under the home energy savings scheme and who goes to the website and downloads the material certainly will be better informed. Many of these issues are teased out as part of that process.
My point is the average person does not go onto the website. One could conduct an advertising campaign that states that for €1,000, one could save whatever amount and what it would cost to have the average house insulated. Does Mr. O'Connor understand my point?
Mr. St. John O’Connor
I certainly will take it on board.
I thank Mr. O'Connor.
I have a question that was not answered. Mr. O'Connor spoke of households and there is a reason people would invest in their homes. However, I refer to investment in the big swathe of public buildings. I have in mind schools, hospitals, courthouses and Garda stations that are not energy efficient. While one can turn off the lights, one still is obliged to heat the building. Such buildings often have single glazing, no insulation, poor structures and so on. They will require major investment which no one will undertake on an individual basis. What plans does the Department have to deal with this issue?
Mr. St. John O’Connor
I will make two points in this regard. First, the Department of Education and Science has a comprehensive and advanced schools rebuilding programme which looks for and takes into account the issue of energy savings and energy efficiency.
I would not cite that as a good example.
Mr. St. John O’Connor
It is in place and while it may have to feed through, that is a separate issue.
For Mr. O'Connor's information, my home town contains a school building that has been condemned on health and safety grounds. It should not be used, apart from its insulation values. If Mr. O'Connor considers the Department of Education and Science's schools building programme somehow to be an answer to my question, it is not.
Mr. St. John O’Connor
The second point I was going to mention was that an implementation group in the public sector energy efficiency working group will be set up to tackle the issue. Obviously, we are aware that the Department of Education and Science and the health service constitute two major areas in which potential savings can be made. They will be obliged to produce action plans that will address these issues in respect of how they intend to produce energy efficiencies. The Deputy is correct in that the aforementioned two sectors have the biggest scope within the public sector. I hope we will be able to address them as part of the group's work.
It must be an easy matter to examine. I recall examining the issue some years ago in respect of hospitals. If one tried to examine the costs of heating two hospitals of similar size with a similar number of beds, the difference could be enormous because one was more efficient than the other. If it is not one's own money, people are less conscious of switching off, doing certain things to the building and so on. While I fully understand and appreciate that Mr. O'Connor represents the Department of Communications, Energy and Natural Resources, someone should drive this centrally. Mr. O'Connor knows what I am getting at. If we are to spend money which is in short supply, one should invest in areas that will create employment and where one will save money. This should form part of such a programme. One would be achieving the targets set, saving money and providing employment. There must be numerous such areas.
Mr. St. John O’Connor
The Chairman is absolutely correct. In our Power of One Street II initiative one of the participating schools in Cork saved €1,240 on its annual space heating requirements through better management of its heating system. The Chairman's point is well made and we will be keeping the matter under close advisement.
My final question pertains to the energy efficiency action plan. What sanctions, if any, will apply, in the event that people do not comply with the targets set in either the public or private sector? Ultimately, while one can set all the targets one wishes, without sanctions people will take no notice of them. Schools are a perfect example in this regard. A large percentage operate from highly energy inefficient structures such as prefabs. The amount of energy required to heat them, the associated heat loss and so on are colossal. Are sanctions proposed where targets are not met?
Mr. St. John O’Connor
The answer is twofold. First, it might be a little early to suggest there will be sanctions. Second, if we take on the action plan which essentially comprises a compendium of measures and actions across the public sector and elsewhere, the measures will have sanctions built in such as in the building energy ratings. They possess their own auditing processes. However, the Senator is correct regarding how we should manage, co-ordinate and drive this process, particularly in respect of the public sector. The interdepartmental group ultimately will be responsible. To clarify, as the 33% target is a target for the entire public sector, it does not necessarily mean that each organisation must reach 33% but that, overall, that number must be reached. There will be greater scope in some areas than others for bigger savings; it will be a matter of balancing it out.
Does this include every organisation within the public sector?
Mr. St. John O’Connor
It does not include commercial organisations. We will clarify this because there is a little work to be done in respect of what organisations should be included. Our thinking is that non-commercial organisations will be brought in with other public sector organisations.
Can Mr. O'Connor clarify what is a commercial public sector organisation?
Mr. St. John O’Connor
I apologise. I was referring to commercial and non-commercial State bodies.
I thank Mr. O'Connor and Dr. Motherway.