I welcome the delegation. I was saying before the delegation came in that this is a comprehensive area of work for this committee and we will not be able to pose all of our questions today. We will write to our guests and outline other questions. Perhaps they could respond to us in due course, as this is a major area for our committee and we would like to make a meaningful input. On this basis, I ask our guests to begin their presentation.
Renewable Energy Action Plan: Discussion with Department of Communications, Energy and Natural Resources
Mr. Martin Finucane
We will have no difficulty with that request. We will be more than delighted to facilitate the committee as required.
I aim to provide members with an overview of the renewable energy action plan, the requirements it places on each member state in the Union and our approach towards putting it together from Ireland's perspective. We can then discuss how it goes through.
The new renewable directive, which introduces the concept of a national renewable energy action plan, was published in June 2009. The first plan in the series will be due by 30 June 2010. The renewable energy directive is part of the combined climate change and energy package originally published by the Commission and agreed in mid-2009. It is aimed at addressing a target of 20% of EU energy consumption from renewable sources. This differs from the approach being taken at EU level. Previously, we had an electricity directive that put in place an electricity target on each member state and a bio-fuel directive that placed indicative bio-fuel targets on each member state. The renewable directive is the first to address overall energy use, including electricity, the heating and cooling sector and the transport sector. The 20% target is based on an aggregate EU level, with different targets identified for each member state. Under the directive, Ireland's target is 16%.
The target assessment process is based primarily on forecasting gross final energy consumption from 2010 to 2020. Our calculations must take full account of energy efficiency measures, in other words, the work done by our Department, the Sustainable Energy Authority of Ireland, SEAI, and others in putting together the national energy efficiency action plan, so that they will work hand in hand. We must break the information up between the electricity, heating and cooling and transport sectors. The only sub-target addressed to all member states on a similar basis is that of a renewable transport target, namely, a minimum of 10% of road transport energy must come from renewables by 2020. The process introduces the concept of flexibility mechanisms where joint projects or statistical transfers can be dealt with by member states to allow those experiencing difficulties in achieving renewable energy targets to benefit from those with excess capability.
I will provide a quick overview of Ireland's status in respect of these sectors. In 2004, approximately 4% of electricity consumption came from renewable sources. In 2009, the figures for which were published today, the figure is approximately 14.4%. Our national 2010 target is 15% and we are on track to exceed it. Our 2020 target is 40%. In 2004, virtually no transport energy came from renewable resources. In 2009, the figure rose to 1.5%, primarily based on bio-fuels with a tiny amount of bio-gas. Our 2010 target is 3% and our 2020 target is 10%, the latter of which is fully in line with our EU target. In 2004, 3.6% of consumption in the heating and cooling sector came from renewables. By 2009, the figure had increased to 3.9%. The 2010 target is approximately 5% while the 2020 target is 12%.
A chart put together by the SEAI shows renewable energy as part of gross final consumption from 1990 to 2009. As members can see, the total has grown consistently year on year since 2003 or 2004. This growth has primarily been delivered by a large increase in renewable electricity consumption, as represented by the blue line. Since 2005 or 2006, the red line representing renewable transport has been contributing successfully larger amounts. The green line represents the heating and cooling sector. We have gone from approximately 2.2% of energy coming from renewable sources in 2003 to 4.8% or so in 2009.
The next page of my submission relates to the effects of the national targets at 2020 and their contributions to each sector in meeting the overall 16% target. The 40% target in respect of electricity will contribute approximately 9% to overall energy. Giving an exact figure is difficult, as one is depending on energy growth in the individual sectors. A 12% heat target will deliver approximately 4% of total energy, as will the 10% transport target. Together, this is 16% to 17% of energy from renewable resources, placing us in line with our directive target.
A comprehensive template was produced by the Commission for member states' use in formatting their renewable energy action plans. To give the committee a flavour of the type of detailed information involved, my submission includes a list of the template tables that each member state must complete. Without going into too much detail, we must show individual directive targets, how we are approaching data to show biomass and how we are approaching the plan from the point of view of supply and available agricultural land use. We must fully list the renewable energy policies and measures in each area and show the contribution of each technology type to the renewable energy figures. We must also show the renewable energy results by mode and their overall contribution to the 2020 targets, how we came up with our projection for energy consumption for 2020 and how that projection takes on board the national renewable energy efficiency aspects. We must break these data down into the heating, transport and electricity sectors. We are specifically being asked to show the share of renewable electricity in the building sector. The last calculation shows how we will meet the target and whether there will be any excess or deficit of renewable energies. Basically, it is a balance sheet of where we will be in 2020.
The template goes into some detail on the measures to be taken to achieve the target. We cannot just state that we have national targets that add up to a certain figure. We must underpin and show each measure with a legal reference as to how it is in place. We must provide a full description of the measure and the expected result. We must explain whether the measure already exists or is a planned new measure to be implemented over time. Under the template, we must outline the start and end dates for each scheme and any regulatory, financial or other information pertinent to the measure in question. It means we must go through the administrative procedures and spatial planning approach being adopted by the State to deliver this amount of renewable energy. We must examine the technical specifications in our buildings, both in new-build and retrofit programmes, with full information provision on renewable energy sources, not just to the public but to the various sectors such as engineering, architecture and the building sector in general.
It will introduce requirements for us to show installer certification where we introduce programmes for new technology and the level of training courses we put in place to underpin that delivery so when the new technologies go in, they are in place in a safe, secure and technically reliable manner. It will also be necessary to outline in detail the electricity infrastructure development, both in terms of transmission and distribution levels.
We must lay down rules for the electricity network operation and rules related to dispatch for that network. We must identify and talk about opportunities for biogas integration into the national gas system and the possibilities for district heating and cooling infrastructure, which has not been a notable feature of Irish development to date. We must also show how we are introducing the biofuel sustainability criteria that will underpin delivery of a large part of our renewable transport plans.
On the electricity side, we must show the fiscal support measures, including investment in operational aid and regulator support measures in place to underpin renewable electricity delivery. The description, with legal reference, must include details of the scheme, duration, past impact analysis and expected future results.
On biomass promotion, we must put in place a biomass availability assessment. We cannot just say we will use a set amount of biomass, we must look at the availability at domestic, indigenous level and at the capability of import, where it may be required to deliver the level of target we are putting in place. We must carry out a resource assessment of our forestry and agricultural resources and the waste resource available to meet and underpin those targets. We must do that while bearing in mind the agricultural land dedicated to energy production in 2007.
There are co-operation and flexibility measures contained in the directive that allow for statistical transfers between member states. Those can only take place when there is an official government to government member state agreement in place. Transfers of renewable energy sources, be they electricity, heating-cooling or transport renewables, only count when they are traded or transferred from one member state to the other when a formal member state agreement is in place. A company cannot sell abroad into a different scheme without a formal government to government agreement in place that underpins it, otherwise, under the terms of the directive, the renewable component of that will count in the country where it is generated, not in the country where it is consumed.
The directive also introduces the capability for countries to come up with joint projects. A good example would be offshore wind. There are already two or three member states co-operating in the development of offshore wind projects off the coasts of Germany, Denmark and previously Sweden. Those states were involved in Kriegers Flak, a multinational development, rather than a national project for an individual member state.
It also introduces the capability of partnering with a third country from outside the EU, whereby investments may be made by the member state in a third country and, as long as it can show an equivalent amount of electricity or transport fuel is brought back into the European Union, the investment can be counted as part of its renewable energy target.
The concept of joint support schemes is also introduced. These facilitate growth in terms of regional market development so a number of member states can join together and if they decide to put in place a joint support scheme, it is catered for under the terms of the new directive.
At the end of that process, each member state is asked to indicate any estimated excess or deficit renewable energy compared with the indicative trajectory it is putting in place in the national development plan. Each member state was asked to submit a forecast document in December 2009 for the renewable position at the end of 2020. In that document, around ten of the 27 member states indicated they expected to be in an excess position, while five or six indicated they would be in a deficit position, that they would be looking to other member states to avail of co-operation mechanisms to achieve their targets. These are indicative forecasts from the member states and will be subject to energy market growth and the outcome of market development schemes between now and 2020. It is hard, therefore, to be precise about the numbers that will be in excess, the numbers that will meet their targets or the numbers that will be in deficit.
The plan has been drafted by the renewable energy division and we are working in conjunction with relevant State Departments and agencies. We are doing this through the auspices of the renewable energy development group, which is chaired by our Department and which has representatives from the Department of Finance, the Department of Agriculture, Fisheries and Food, the Department of the Environment, Heritage and Local Government, and the Department of Transport. It also has full membership from the relevant energy associations, such as the IWEA, Meitheal na Gaoithe and NOW, the National Offshore Wind Association of Ireland. Equally, the bio-energy groups are represented on the group. It is a broad representative body and we have been using it for the last two years to help us put together this plan.
Ms Dixon acts as chief author and editor in chief of the different pieces that are being done in conjunction with the other Departments. She will give a quick overview of how our approach to the national plan is progressing.
Ms Úna Dixon
I will outline how we are compiling the national renewable energy action plan, NREAP, as it is known in the EU.
As Mr. Finucane said, a renewable energy development group meets on a quarterly basis. It consists of public and private bodies and stakeholders in the renewable energy sphere. The group has met a number of times in the last six months and has been kept fully informed about the template and what is happening with it. The template is a Commission decision that published in June 2009, a 40 page document that sets out tables and questions to be answered. When it was published, the REDG was given a copy for its consideration. In December 2009, under the renewable energy directive, the Department was required to submit an initial forecast document to the European Commission. The forecast documents of all countries are published on the European Commission's website and we kept the renewable energy development group informed of what we stated. Some of the tables had to be filled out in an initial format for that purpose. The document comprises 40 pages of tables and narrative and must be submitted by 30 June. To complete the tables in the document, which relate to transport, heat and electricity, the Sustainable Energy Authority of Ireland, SEAI, has undertaken modelling work. It has a bioenergy model and a renewable energy sourced electricity, RES-E, model.
Section 4 of the template consists of approximately 100 questions asking what is being done now and what is planned to be done. It covers the three sectors I mentioned and all of the questions are answered to show how one will reach one's target in 2020.
It sounds to me that Ms Dixon spends most of her time filling out forms.
Ms Úna Dixon
It is a template and we have no choice but to answer the questions. That is the way it is going.
In the middle of March at a meeting of the renewable energy development group we outlined the procedure we will follow, which is that we will draft the answers to each section of the template, send them to the members of the renewable energy development group and request feedback by the end of April. We compiled the draft responses with the relevant State bodies, including EirGrid, the Commission for Energy Regulation, ESB Networks, the Department of the Environment, Heritage and Local Government and the Department of Agriculture, Fisheries and Food. We sent the responses to the renewable energy development group and an additional list of consultees comprising others who were specifically requested to be part of the process or who flagged to us that they would like to be part of the process.
On 7 May we held another renewable energy development group meeting at which we set out the feedback we had received on the various sections of the template. We stated that we would review all of the feedback we received on the document with the State bodies with whom we compiled the information, and that in the next two weeks we would publish the document in draft format on our Internet site so people will have a final chance to give feedback before we submit the final document to the European Commission on 30 June. That is the process we have been undertaking on the NREAP to date.
Before I call on Deputies Coveney and McManus, may I ask to whom the Department reports? Who will drive this? We have been here for the past two and a half years and we have been looking for progress and legislation in certain areas, and we prepared legislation. It is grand to have forms to fill up to send off to Europe and it is grand to have all of these groups meeting but to whom does the Department report so that if things are not happening a political figure will drive it, and ask where the blockage is and what is being done about it? This is most important; if things are not happening how does one gets them to happen?
The transport target is 1.5%. One of the first people to come before the committee after it was formed was the Minister for Transport. We asked him to initiate pilot schemes, perhaps starting with local authority vehicles or Dublin Bus, and to lead by example. However, to date we do not have one bus driven by renewable energy. This is a frustration that we experience. In the implementation of the plan there will be a vast amount of frustration if things do not happen. Therefore, I would like Mr. Finucane to tell us who is the person to whom he reports and who co-ordinates all of this. He deals with various Departments and agencies. It is important that somebody picks up the phone and gets action to achieve all of these things. Will Mr. Finucane outline the position on the leadership role needed to drive this?
Mr. Martin Finucane
The first point to emphasise is that it is significantly more than an exercise in form-filling just to report to Brussels. That would very much be the easy way out of dealing with this process from a national basis and certainly much quicker and simplified from our perspective. We have engaged at first hand throughout the departmental spectrum. We have involved the Department of Transport in dealing with transportation and the Department of Agriculture, Fisheries and Food in dealing with bioenergy. We have also had very deep engagement with the Department of the Environment, Heritage and Local Government with regard to planning, spatial areas and building codes.
Will Mr. Finucane give an example as to what has happened as a result of those consultations?
Mr. Martin Finucane
Certainly. We put together the bioenergy action plan which we will publish as part——
Besides an action plan, what is happening on the ground? Are vehicles being driven by various types of fuel?
Mr. Richard Brown
The recently published renewable energy feed in tariff, REFIT, targets in anaerobic digestion did not come about on the basis of what we as an energy Department would like to do but rather as a result of contact with the Departments of the Environment, Heritage and Local Government and Agriculture, Fisheries and Food with regard to waste management primarily. Anaerobic digestion has a number of other uses but waste is in many ways its first port of call. Part of the bioenergy working group and the larger NREAP process is a series of modelling on not only costs but on greenhouse gas emissions and potential benefits. In conjunction with the Department of the Environment, Heritage and Local Government we examined what we could do to help it meet the landfill directive and SI 508/2009, which deals with waste diversion. The rates we put in place and the systems that will underlie them, which are not visible at present, deal with waste management throughout Government.
The Chairman mentioned the difficulties experienced and the frustration felt with regard to an apparent lack of progress in the transport sector. The statistic of 1.5% in the figures produced to date is primarily due to the mineral oil tax relief, MOTR, scheme, which has seen renewable energy use in transport go from practically nothing to 1.5%. It is not much but it is a start. This scheme was in many ways an initial stimulation scheme; it was a start. It is being replaced by the bio-fuels obligation scheme, which will come into place from 1 July, thanks to legislation approaching finality. All of these are comprehensive steps. In many ways, the frustration being felt can be linked to the fact that the initial steps were difficult. They were exploratory and there was much discussion in 2006 and 2007 about Dublin Bus and how to get more bio-fuel vehicles on the road. At present, practically every vehicle on the road is a bio-fuel powered vehicle but at very low percentages. One can avoid——
In Dublin Bus?
Mr. Richard Brown
Practically every litre of fuel sold in the State now contains an element of bio-fuel because of the MOTR scheme. The majority of diesel sold in the south coming out of the Conoco Philips plant in Whitegate is B5; it runs at 5% bio-diesel as a consequence of MOTR. That blending limit can be used in any vehicle on the road at present. It might not be as apparent or significant a process——
One would imagine it would be stated on the side of the bus. One sees it in other countries.
Mr. Martin Finucane
Part of the aim behind these policies is to get very significant amounts of this mainstreamed as opposed to targeted at a few specialist vehicles, which was done at early stage development of markets. A policy option such as the bio-fuel obligation is about getting this into mainstream vehicles so that virtually all of our cars will use 2%, 3% or up to 7% bio-fuels. That is the way one will get mass market penetration across the system at a national level.
The use of demonstration units is the route we have gone on the SEAI approach, for example, towards developing some early demonstrator projects on electric vehicles. There are now electric vehicles in use in five or six local authorities and Government bodies as demonstrator units coming out of programmes supported by SEAI. As time goes on and we seek to get them right across the mass market one has to go beyond small pilot projects and get them into the mainstream. That is the stage we are now at with bio-fuels. Rather than see a few high-profile vehicles on the roads which are very high bio-fuel users it makes much more sense when we are obliged at national target level to enter the mainstream market in lower amounts. It is a much more significant way of reaching our targets.
I thank the delegation for appearing before the committee. Before I ask questions I will comment on what it said because I agree that we are making some progress on bio-fuels. The bio-fuels obligation makes sense and gives a guaranteed scale of market for bio-fuels in Ireland, the majority of which, it is to be hoped, will be domestically produced. It is not true to say that the alternative technologies for reducing emissions in the transport sector are all in the exploratory phase. If one goes to most European cities one will see public transport vehicles running on gas or electricity. If one visits places like Copenhagen, for example, one finds all of the regular buses, not those which are on a special test, are gas. There is something similar in Brussels. If one goes to Hong Kong, one finds all of the taxis use liquified petroleum gas.
We think we in Ireland are the first to do these things; we are not. I accept that we are making some progress in being a first mover in electric transport, although we are not ambitious enough, in terms of getting things up and running quickly. I acknowledge the Minister and Department have done a great deal to try to push this forward. The recent memorandum of understanding with Mitsubishi is another step in the right direction. We are edging closer to where we want to be, rather than trying to fast track it. I find that frustrating because the advantage of being a small country is that we have the capacity to change dramatically quite quickly. A country like Germany or France, or even Belgium and the Netherlands, because of where they are geographically cannot do what we can do, in terms of electric transport.
Being an island is a disadvantage in most trade sectors, but it is a huge advantage for electric cars because we have an isolated market whereby 98% of cars never leave the island. It gives us a huge opportunity to do our own thing and be three or four years ahead of the rest. The moves towards electric transport and, in particular, electric transport in the fleets controlled by the State, such as those used by An Post, the ESB, local authorities, Dublin Bus, Bus Éireann and Iarnród Éireann, are areas where we can bring about transformation very quickly in the way in which we power vehicles and the emissions which come from them. The State could lead the private sector for a change. People know me well enough to know that I have a hang up about electric cars.
On some of the more positive things I would like to say, this will be very useful when it is place. I believe in setting targets and judging people's success on whether they meet them, which is exactly what a national renewable energy action plan will do. Correct me if I am wrong, but I understand that we will be setting targets each year between now and 2020 for the targets we need to meet in all these sectors. If we do not meet them, somebody needs to be held to account because we are falling behind our schedule.
This committee needs to see that happen. It is one of the great frustrations we have had. We have heard a great deal of generalised discussions about what Ireland can look like in 2025, from where we can generate our power and so on, but there has not been a road map to get us there. It has been very uncoordinated, in particular in the heat sector. There is a plan for electricity and, to a certain extent, transport, although it is not comprehensive enough. In terms of the heat sector, it has been absent to date. From that point of view, having a road map which is comprehensive and deals with the three key areas in the one policy makes a great deal of sense.
It is somewhat surprising that this committee will not have the opportunity to see a draft report before it is published to give us an opportunity to comment on it. I have not seen it yet; perhaps we will get a chance to do that. I would welcome it because members of this committee have something genuine to offer, in terms of policy in this area, and, more importantly, want to support it. Members of this committee may also find themselves in positions of real influence in the next few years having to implement this plan.
I have one or two questions. One concerns the last slide of the presentation which outlined statistical transfers between member states. It is a very interesting area for Ireland. We aspire to use our natural competitive advantages to produce power here for the purposes of export. It is essential that we understand how that transfer would work. If, for example, we build an interconnector with France at some stage in the future, either through Britain or directly to France, we need to have the capacity, under this plan, to be able to import cheap nuclear power and sell premium priced green power to France to help it meet its targets and bring price competition into the Irish market. Does the arrangement with the European Union facilitate that? If so, the delegation might provide a description of it.
Likewise, in regard to joint projects with third countries, if Ireland decides to significantly ramp up its percentage of bio-fuels to be blended with petrol and diesel and if we are importing 50% of that requirement from Brazil in the form of ethanol, for example, how is that factored into our calculations under the agreement, in terms of the difference between that and producing ethanol in Ireland? I am not clear on how that works.
One of the frustrations of the committee has been that we get presentations in isolation from different Departments. The Minister for Agriculture, Fisheries and Food, Deputy Smith, comes in with his team and talks about the challenges facing agriculture. The Minister for Transport, Deputy Dempsey, comes in with his team and talks about the challenges he faces in transport. The Minister for Communications, Energy and Natural Resources, Deputy Ryan, comes in and talks about energy. The reality is that all of these things are linked. Agriculture needs to grow the crops which can power the vehicles in transport which can potentially act as an energy store for the renewables sector if we produce power that can be stored in a battery-powered vehicle.
The big challenge for the delegation is to pull all of the Departments together to get buy-in from all of them, because from our experience certain Departments do not seem to know what is going on in other Departments, in terms of commitments, plans, pressures and obligations on them to deliver in their sectors. I strongly welcome the joint approach, if this group is meeting on a regular basis, and ensuring that there are influential people in different Departments in the group so that everybody operates with the same motivation in mind, to drive down emissions in a sensible way that does not result in consumers incurring significant cost increases for electricity, heat or transport. Perhaps Mr. Finucane will respond to some of those suggestions and comments.
I welcome Mr. Finucane. He has a big job of work to do and I wish him well. It is very clear this is an EU-driven project. All I can say is God bless the EU because I am extremely concerned about this. The Chairman raised the question of responsibility. Obviously, there is a political responsibility which is absolutely central to whether the plan will be a success.
It is quite clear that whatever commitment and goodwill there was to tackle climate change at a political level, it has crumbled away. All of us presumed the Cabinet sub-committee on climate change met on a regular basis. However, I was quite shocked to discover that in 2008, it met six times, which was probably reasonable. In 2009, it met only twice and this year, it has not met at all. Two weeks ago, the Minister for Agriculture, Fisheries and Food appeared before this committee and I asked him about the sub-committee. He said he did not know how often he had attended it since January because he was a very busy man.
When there is that vacuum at the top, it makes Mr. Finucane's job and our job extremely difficult. I do not expect Mr. Finucane to respond to this because it is not his responsibility. However, this is an all-party committee and we have worked hard and effectively together to play our part but there has been a crumbling away on the part of the Government, which is deeply disturbing.
This is what happens in government unless there is a legislative framework from which a government cannot resile. That is why the question of climate change law is so crucial. It seems the climate change law we propose would ensure that the project is driven from the top, from the Taoiseach's office, and that this idea that certain Departments could step in or step out as they choose would simply not be permitted.
I do not expect Mr. Finucane, a principal officer in the Department of Communications, Energy and Natural Resources, to force the Department of Agriculture, Fisheries and Food to live up to its responsibilities. I expect him to do what he is doing. However, the idea that he can dictate to other Departments and ensure they comply with an energy plan has not been my experience. I have been in a Department and I understand the way Departments work and, frankly, whatever co-operation exists is very welcome, it is not the way this project will be managed. It is hugely challenging for us to succeed in terms of our commitments for 2020. The idea that we can have business as usual is laughable.
I expected a slightly different presentation. It is not a criticism but what Mr. Finucane presented us with is really about process. Had we bothered to check it out, we probably would have known that already. However, I thought there would be more about the actual product, about the targets and about what, for example, Mr. Finucane estimates the energy demand will be in 2015 and 2020 and the kind of routes we will have to travel to meet the commitments of a reduction of 20%.
Much of what Mr. Finucane said made a great deal of sense. It will be very hard to avoid answering the questions because they are so clearly set out. It will be pretty difficult and I look forward to when the document is published in draft form because we will have things to say on it.
For example, in regard the different areas, whether solar, bio-energy or wind, I am not clear from what Mr. Finucane said as to whether there will be information which will state this is the contribution solar will make and the levels, on a yearly or five yearly basis, at which we will harness that kind of power for our purposes. Perhaps he could talk a little about that.
It is extremely unfortunate that I must raise the following issue again. There is an issue in regard to growers of miscanthus which I thought had gone away. Valerie Cox on "Today with Pat Kenny" did an excellent job of putting pressure on the Minister and the Department to announce a refit scheme, which was announced on Monday. Everybody thought that had been put to bed. A press conference was cancelled and there was no further ado. Unfortunately, as I understand it — perhaps Mr. Finucane can put me straight on it — it could be another two months before this tariff is in place. It has been tied up with this policy document or plan and would require Brussels approval.
That is the message the industry is getting, that is, the growers who are in deep trouble currently. We talk loftily about bio-energy. We already have an indigenous product which has proven to have a market at home and yet we do not seem to be able to join up the dots. That is really worrying because it is a small but important test on whether we can deliver on this. Perhaps Mr. Finucane can clarify that because there is another issue that concerns the miscanthus industry.
When one looks at the refit and the tariff, the question is that if Bord na Móna takes operating capital costs off this price, that will not assist the industry enough. Will operating capital costs be taken off it? If they are, the growers need to be told that because they will get into something else or else they can be reassured that everything will work out for them.
My other point relates to cost about which we are all very conscious currently, whether talking about cost in transport, in particular, or other areas. Who will monitor the changes in cost that may arise as a result of the changes in energy use? Will that be an in-house job or will some other agency look at it? I do not know if the CER will have a role in it. Perhaps Mr. Finucane will comment on that.
The geothermal legislation relates to heating, although to new developments. Since we do not have any new developments, I do not know whether geothermal will produce a great deal but let us be positive about it. When can we expect that legislation to be published?
Mr. Martin Finucane
I emphasise that we are not putting this together on our own. This is not energy policy being put together by our Department and then landed on the desk of somebody in a different Department. On the relevant parts of putting it together, we are putting it together after building on a very deep foundation which we put in place in working with the other Departments and agencies. It is not a case of ambushing somebody by delivering something on his or her desk. He or she will have taken an active role in developing our energy policy in the areas for which he or she is responsible.
For example, on the bio-energy part of this, we have been working on bio-energy design in regard to electricity, heat and the transport components for more than 18 months with very extensive involvement not only from the Departments of Agriculture Fisheries and Food, Finance and Transport but also from the relevant agencies, such as Teagasc and Coford, and with the industry associations inputting into this.
The type of modelling that has been done for us on this by the Sustainable Energy Authority of Ireland and the policy responses we are putting in place are heavily influenced by the input and work of the other Departments, agencies and the industry people. This is not just stuff we pull out of the air ourselves. Extensive work is going on to develop this policy. This is far from being a form filled out in one office and posted to Brussels. Extensive work is being done behind the scenes with other Departments, agencies and industry actors. It cannot be a surprise to anybody when it comes out.
Is a draft available? We are a month away from publication.
Mr. Martin Finucane
We have sent individual draft sections and chapters to everybody on the renewable group. We have asked the industry association to circulate the drafts to their members for feedback. They have also been circulated to an expanded list of people who expressed interest.
Reports like this should be automatically sent to us. What is the purpose of this joint committee if we are not circulated with this type of information? The problem is that we are being forgotten. We invite Ministers before us to give us a spiel for 30 minutes and then they leave and forget about us. Two and a half years ago, we went to the trouble of producing an offshore renewable energy development Bill which nobody has replaced with alternative legislation. We have been led to believe that we are wasting our time. If Parliament was taken seriously in this process, one would imagine the Oireachtas Committee on Climate Change and Energy Security would automatically be included in the circulation list for comments on proposals.
It is frustrating from our point of view. We are doing our level best to co-operate because we believe in this cause. As Deputy McManus has noted, we offer the unique experience of a committee which has acted on an all-party basis since its inception but we are totally ignored when it comes to consultation and input into real plans. At the end of the day, plans cannot be implemented if legislation is not put in place.
There is no mention of introducing the climate change Bill to the Dáil this session. I tabled a parliamentary question on it and was referred to an earlier reply which said nothing about when it was being introduced. This is becoming impossible. We have asked for Bills for geothermal and offshore renewable energy but there is no sign of them.
We are discussing a plan which is supposed to bring us to our target of 20% in ten years' time but we do not have a hope in hell of reaching it. We have not even begun to build the grid. There are plans and plenty of talk but nothing is happening.
Mr. Martin Finucane
I must object to the last point made by the Chairman.
As Chairman of this committee, I find it objectionable that we are not included in the consultation process of plans being prepared in this area.
Mr. Martin Finucane
I must object to the Chairman's point that there are all plans but no action on the ground. That certainly is not the case. We have seen dramatic increases in our renewable energy production, albeit from a relatively small base, over the past six years. We are one of the few EU member states which will reach the target set out in the electricity 2010 directive. No more than ten states are likely to meet that target but we will have exceeded it. Far from no action on the ground, we are actually achieving our targets.
In the electricity sector, targets and plans for 2020 or 2025 have been underpinned with delivery at ground level. For example, considerable effort has been invested in the Eirgrid 25 plan for infrastructure development. We are on track to deliver the east-west interconnector by 2012, subject to planning and delivery at ground level. It is not an accident that considerable work is ongoing in these areas. A lot of people are delivering at ground level and across the system. It is unfair to say that we are here again with plans but no action at ground level. That is a harsh view of the world.
That is perhaps Mr. Finucane's view but vast numbers of people outside the system who speak to us on a regular basis would disagree. Miscanthus is a perfect example. People were encouraged to grow this crop but now it is rotting.
Mr. Martin Finucane
There have been extensive field trials over the past two years in the Bord na Móna plant in Edenderry, so much so that it expects between 7% and 10% of its entire capacity to be co-fired with biomass. A range of feedstocks was examined over that period, including miscanthus. The industry is fully aware of the chemical and technical issues that arise in regard to the amount of miscanthus that can be co-fired successfully with peat but it does not mention them. The Bord na Móna trials indicate that miscanthus can be co-fired at a proportion of between 5% to 10%. Obviously alternative types of biomass are available, including willow coppices, but the proportion of miscanthus that can be used is limited.
The burning issues around miscanthus were largely resolved by the time it was harvested. These issues were initially significant but that is no longer the case.
Mr. Martin Finucane
On technical matters, I can only share with the committee what Bord na Móna tells me.
Mr. Richard Brown
There has been considerable discussion.
I do not want the meeting to be diverted into a discussion of miscanthus. I used it as an example.
Mr. Richard Brown
Several questions were raised about it and we might as well address them in the round. The issue of co-firing has been discussed at great length of late and much of the emphasis has been on miscanthus. Bord na Móna burned 122,000 tonnes of biomass over the three years to 15 April 2010. Less than 1% of this comprised miscanthus because there were insufficient supplies but greater volumes are now becoming available on the market.
A number of chemical and technical issues arise. Substantial uncertainty remains about the types and proportions of material that can be burned. The peat sector primarily uses two types of boilers. Bord na Móna operates one type and the ESB operates the other. The Bord na Móna experience indicates that it will be limited to 5% miscanthus because of chlorine issues. Considerable work has been done on husbandry and harvesting in order to control for chlorine but Bord na Móna remains less than satisfied that miscanthus will work for its boiler. The ESB may take a different attitude but it is still conducting field and laboratory trials.
Since we commenced these discussions over two years ago, the industry has been fully aware — last night I had a long conversation with a representative of one of the companies concerned — that it will need state aid clearance to deliver on refitting.
When was state aid clearance sought?
Mr. Richard Brown
We will need to do it in the round. We have not done it yet but it will have to be completed in the coming weeks.
Those targets were due in March.
Mr. Richard Brown
They were not; that is the difficulty.
They were due in March.
Mr. Richard Brown
In December 2009 and January 2010, I held a series of meetings with the IFA and several of the companies involved to address issues pertaining to miscanthus and co-firing. Some people understood from the meetings that an announcement would be made in January but such a commitment was never given.
The technical problems remain unresolved but, leaving these aside for the moment, substantial economic questions arise in terms of the price we should set for co-firing. We went with a diversified tariff, which is difficult to police, primarily because the energy crop sector clearly needs a higher tariff. To answer Deputy McManus's question on capital costs, we only set an energy and variable operations and maintenance, VOM, tariff. This morning I had a long conversation with Teagasc and a representative from one of the companies concerned on how refitting could work in the sector. There appears to be a misunderstanding in regard to how refitting will feed back to the producer groups. The tariff is energy based and is paid on the electricity as it comes out of the plant.
Are those tariffs intended to cover capital and operating costs?
Mr. Richard Brown
No, the plants use them to pay for the material they use. The tariff is distinct from the public service obligation system which covers the peat plants at present or the tariff system under which wind and other plants operate. REFIT pays for the energy and the plants can theoretically use it for whatever they want. However, the tariff level is constructed on the basis of fuel and variable operations and maintenance, VOM.
Sorry, on what?
Mr. Richard Brown
The fuel cost is included in the buying material and the variable operations and maintenance that comes from using a different feedstock. For example, if often costs more to run conveyor and handling systems with biomass than it does with peat, which is a variable cost ergo it is built into the tariff.
So, there is no obligation to pass the guaranteed price on to the producer.
Mr. Richard Brown
Nor can there be as these are commercial companies.
Is it the power station that makes the decision?
Mr. Richard Brown
The power station — this does back to the——
Mr. Martin Finucane
In terms of a REFIT application, the price set between the supply company and producer-generator will have to be at a minimum the fixed price under REFIT. In many cases it is set at a slightly higher price but that depends on the commercial negotiations between the supply company and generator involved. The REFIT-based price must be set at a minimum.
Perhaps the delegation will forward to the joint committee a note or e-mail clarifying exactly how this will work.
Mr. Martin Finucane
Yes, we will do that. Deputy Barrett mentioned earlier that there are a list of issues on which the joint committee will be seeking information. We can include the information requested by Deputy McManus as part of that note.
Have all Members' questions been answered?
Perhaps Ms Dixon will continue her response to my questions.
Ms Úna Dixon
On Deputy McManus's query in regard to the consultation process, as I mentioned earlier we had an initial consultation with the specified group, the Renewable Energy Development Group, REDG, and some other people. We are planning to engage in broader consultation which will be published on the Internet to which Members will be able to respond. Mr. David Taylor asked me the other day for a copy of the information we had sent out on this. I sent him a copy of the 132 pages that have issued to date in response to the 100 questions. I have no problem sending this directly to the committee in any form. We are modifying the document on the basis of the feedback we have received. An updated version will be published on our website in approximately two weeks time.
We interact on a frequent basis with the Renewable Energy Development Group, REDG, which was included on our initial list of consultees. I sent the document out section by section and asked everybody to whom I sent an e-mail to inform me of any other person-body to whom they would like me to send the document. All of the groups of which I was informed have been added to the initial consultees. Nobody suggested to me that I should forward the document to this joint committee. Had they done so I would have forwarded it to the committee.
With all due respect, we do not accept the idea that we dependant on the industry to advise the delegation that we have a role to play in this area. This is an all-party committee set up by the Oireachtas which has done massive work in this area. I suggest that in future the delegation view this joint committee in terms of what it is. We are not just another interested party thinking of growing miscanthus.
We are part of the national Parliament.
Mr. Martin Finucane
Absolutely. I do not mean to suggest otherwise. We fully recognise that position.
We may be inconvenient for some people but we are part of the national Parliament. People constantly complain that this Parliament does not function. This is a perfect example in this regard. People think about Government and nothing else.
Mr. Martin Finucane
In terms of the work of the joint committee, I have appeared before it several times in different guises. Earlier this week I attended during the discussion on the bio-fuels Bill. We have received several pieces of work from the joint committee which have influenced or shaped some of our policy. Mention was made of the offshore draft legislation produced by the joint committee. The joint committee's work on electrical vehicles also fed into the Department. We are well aware that the joint committee is doing extremely good work in this area. We have been aware for a number of weeks that we would be appearing before the joint committee in respect of this particular topic. It was always our intention, once a comprehensive plan had been put together, to submit it to the joint committee at the same time it was being sent everywhere else.
The full format of the document has not been at this point sent out. Only a chapter by chapter version has been issued for initial first comment. It is not the case that we have sent out this document to the world and its mother and not to the joint committee. We are in the process of putting together a first comprehensive full draft of the document. The joint committee will be one of the first to receive it when completed. Far from ignoring the joint committee, we fully accept and appreciate its work to date, which we have always found useful from a departmental perspective. Equally, we must be given time to put these documents together in a format that is legible and understandable holistically. We do not want to simply throw 50 different pieces of paper across the desk of the joint committee over a two or three week period, which is basically what we are now doing. Much detailed work has been done in a short space of time. We are not trying to hide this; what we are trying to do is put it into a shape that is easily understandable and relevant to the audience reading it. The reason it was forwarded to the REDG in that format is because it has been involved in the process from the beginning and understands the way this is progressing. It knew it would be receiving the pieces of the jigsaw one at a time and would not be seeing the full picture on the front of the box. We need to be in a position to show the full picture on the box before submitting it to the joint committee. That is the approach we are taking.
We did send the document to Mr. Taylor in advance of this meeting as part of the information process. We are not trying to keep the document from the committee. We want to ensure when it is forwarded to the joint committee that it will be comprehensive and understandable.
I welcome this engagement which I believe is helpful in terms of making us aware of what is happening. This plan is needed. The targets it contains are essential. For me the most important issue is how those targets are achieved across the various sectors and Departments.
I share the concerns and frustration already expressed not alone by colleagues and the Chairman of this committee but by stakeholders which have become before us during the past two years in regard to their trying to break down barriers in the field of renewable energy, be it lack of regulation or legislation. People are frustrated and this needs to be acknowledged. We have been trying to find ways to cut through red tape and those barriers. There is a belief that there is a lack of co-ordination and a need for more cross cutting policies and implementation across the various Departments.
It appears this plan is EU driven. As stated, it must be reported through Brussels which begs the question of whether the plan will receive as much priority from Government if it was not being driven by the EU. How high on the list of Government priorities is this plan? I believe this joint committee has a role to play in regard to how this plan will be finalised and in this regard there should be further engagement and consultation with it.
I acknowledge that we are making progress in the electricity and transport sectors. I would like to focus on two areas, namely, the biomass co-burning area mentioned earlier with specific attention to forestry resources. At a meeting this morning of the Joint Committee on Agriculture, Fisheries and Food I heard Coillte representatives express concern in regard to the output from some of their resources, including off-cuts and shavings. The delegation may be aware it already has companies operating in the semi-State sector, namely, Medite and SmartPly, which provide huge employment and re-use or recycle off-cuts and shavings. The Coillte representatives have undertaken to analyse this whole area. I detect from what they said that they are concerned the off-cuts and shavings being used in these companies, be it from the Coillte or private resource, might be diverted into co-burning, which is less efficient than what it is already doing and would have far-reaching implications for employment in these semi-State companies operated by Coillte. They have markets for their produce. To what extent has there been consultation or analysis with Coillte, which is a semi-State body? Is it involved in the group dealing with the renewable energy consultation. There seems to be a conflict between Coillte's objectives and Bord na Móna's objectives. They are two semi-State bodies that might have different outcomes and different targets.
The second area on which I would like to focus is the bio-energy waste to energy area. I note from a press release issued by the Minister, Deputy Ryan earlier this week that he refers to anaerobic digesters and that area, which needs to be analysed and teased out. How does that fit with the national waste management plan and the high profile incinerator proposed to be located in Poolbeg? I am also aware that possible incinerators are proposed in various regional waste management plans.
If a finalised plan is to be produced with a period of weeks or months, surely we should know the long-term plan for waste management, whether we will go down the incineration route or the anaerobic digestive route? We need to have these details before we can complete the plan. Due to a lack of co-ordination in preparation of the national waste management plan, it seems we do not know which route will be taken. There is huge potential in district heating, whether sourced from incinerators or heating initiatives from an anaerobic digestive system. Given that we do not have information on what is proposed in the national waste management plan and how we would cope with heat outputs or heat potential from it, how do the delegates envisage we will complete this plan for the EU?
I apologise for being late; I was in the Dáil for Priority Questions, one of which related to emissions from the agriculture sector. Following on from what Senator Coffey said, I attended the committee meeting this morning at which representatives from Coillte said that the biomass product Coillte uses in medite production is an efficient use of the product as opposed to co-burning, which has probably a 30% efficiency per tonnage of use. The tariff is important for bio-fuel production, but they expressed concern that it should not be used to divert from other alternatives that have better efficiencies and uses. One factor is geography, the geography of transporting the product from Wicklow to Edenderry or Tullamore, which has a 30% efficiency as opposed to sending the product to Waterford where it can be far better utilised. Those factors should be taken into account. The Minister's announcement earlier this week did not seem to have regard to that sort of quality control over what products are used in the process.
We are discussing the national renewable energy action plan at this Joint Committee on Climate Change and Energy Security. Having a renewable energy action plan is an important way of dealing with the challenges in the areas of climate change and energy security. The representatives must take on board that this committee, which was set up to deal with this area, feels a little aggrieved that it was not involved in this process.
Some €50 million was set aside in 2009 for the purchase of carbon credits by the State. Have the delegates any influence or remit to enable them to suggest how such funding might be used? Many of the problems that have arisen in the bioenergy sector have been related to pilot projects that did not get off the ground and to failure to invest priming money to set up anaerobic digestion systems on a small scale similar to those operating in Austria and Germany. People tend to cite the systems operating in Austria, Germany and the Scandinavian countries, but they work. We have the potential to set up such systems. We have had numerous presentations on anaerobic digestion systems from different sectors. The setting up of such systems would require a feed-in tariff and also priming capital. Have the delegates any input into that process, whereby they could propose that instead of €50 million being set aside for purchase of carbon credits €20 million should be put aside to get these projects up and running and not to have the miscanthus debacle repeated in other areas? I had a further question which has slipped my mind so I will leave it at that.
It was said that the committee system does not work, but I believe it does. With the benefit of hindsight as we look to the future, the work being done by the Chairman and the committee will reap rewards in the future. I thank the Chairman for the work he does in his role and for the enlightened way he addresses our meetings.
What is the figure for projected energy demands in 2015 to 2020? What measure is in the plan to provide for a tripling of wind energy and electricity that will feed into the grid in the next ten years? What provision is in the plan to increase the use of renewable energy in transports networks in the next few years? What are the strategies in that respect? Where and in what way are the issues of electricity generation onshore and offshore, grid infrastructure, planning and permissions addressed in the plan?
I asked one or two questions about exporting and importing and balancing surpluses and deficits. I would like the delegates to indicate how that works.
My other brief question, to which the delegates will hopefully be able to give a date in terms of the answer, is when will an export tariff scheme be introduced for micro generation projects? Will it be introduced prior to the summer break?
Has Deputy Doyle remembered the other question he wanted to ask?
I have two brief questions the answers to which may not be simple. Does the Department consider it appropriate that the Government should have a right of access to some of the energy sources, such as wind or gas that are being harnesses off our coastline?
My second question relates to the bio-fuels legislation which provides for a 4.1% bio-fuel obligation. There is no obligation for that 4.1% to be Irish sourced. Could incentives, such as the 2% tax rebate on the fuel be introduced to provide for that? That initiative I cited as well as the refit tariff for biomass gives people an incentive to source the bio-fuel product locally.
Mr. Martin Finucane
I will address the questions in the order in which they were put. Senator Coffey raised the role of Coillte and the use of forestry thinnings and waste wood in Medite and other board plants owned by Coillte. Coillte is the owner, guardian and operator of the State forestry resource. The analysis that was done for us, part of which involved Coillte, revealed that, on the private forestry side, much of the forests planted in the late 1980s and early 1990s will be coming on stream over the next decade in terms of wood becoming available from that source, in addition to the Coillte resources. That wood will require a market now and into the future. One issue is setting up a market for that product. Traditionally, Coillte used virtually all the wood from its estates in its board mills and in co-firing on them. The demand for that product, as any construction sector business will have found, has been challenged in recent years and is likely not only in the Irish but in the UK context to be challenged in the coming years. With the amount of new resources coming on stream, Coillte will find that it will need a demand source for those. Co-firing is one of the areas that provides an opportunity for forestry, in terms of utilising thinnings and waste from new and future crops coming on to the market and in terms of dedicated energy crops such as the start of the miscanthus process and the use of willow and so on, which will have a growing use in co-firing into the future. It provides an opportunity for them. I am sure they are taking it into consideration in their forward business planning but, in its absence, they would also find a difficulty. It is a question of getting the balance right which is one of the reasons our whole bioenergy approach has occupied us for quite a length of time. We have been doing a great deal of concentrated work on this over 18 months because we must ensure, for example, that the types of system we are putting in place to incentivise electricity biomass use will not compete directly against the biomass we want to use for the heating market and, equally, what we want to use, potentially, for transport fuels. It is a question of getting a balance across those sectors. Otherwise we could end up with one set of Government tariffs chasing another set in a different area, which is not a good way to go for the future. That is why an important part of our work in this area is to have done resource assessments, not only of forestry potential but of the agricultural land both currently and potentially available, in terms of energy crops.
Will the delegates examine the efficiency of this?
Mr. Richard Brown
The Deputy is right to concentrate on the efficiency question which is key. The analysis we conducted looked not only at the location and type of the resource but at the most efficient way of bringing it to market. Obviously, heat is the challenging sector and combined heat and power, CHP, is an area that provides us with huge potential. This goes right back to the board mills. Coillte owns several but there are others in the market too which are also dependent on this resource. The primary way in which we can control, or at least have an element of control on the market regarding which material is used where, is, first by setting tariffs relative to each other for CHP versus co-firing. Members will see that the co-firing tariff is significantly lower than the combined heat and power tariffs. The absolute rate for the co-fired tariffs is set on the basis of ensuring we do not compete directly for resource with the relatively high value product the board mills have to use.
Mr. Finucane also was right to point out that the heat question is critical. We are trying to build a biomass sector that is robust and stable, not only this or next year but for the foreseeable future, so that commercial companies that look to build either new facilities or refit existing ones can look at CHP and be fairly secure they will have a feedstock for the ten year or 15 year life of a piece of equipment. There will be an element of readjustment in the relative prices of material which is inevitable, to some extent or other. We have looked at it very carefully to ensure we do not impinge adversely on those existing users while still providing new users with the security they need to invest.
Mr. Martin Finucane
There was a specific question on the infrastructure issue, how it was built or how we see it going forward over the next decade or so. In terms of the existing plant on the system, in electricity about 1,550 megawatts of renewable power have been built and connected to the system already. The vast bulk of that, some 1,250 to 1,300 megawatts, is wind powered; the rest is made up primarily of hydro power with small amounts of biomass, in particular, landfill gas. On top of that figure we have an approximate further 1,250 megawatts, primarily wind power, that have signed connection agreements already with EirGrid and ESB networks. They are signed up and ready to come on the grid and are the type of projects that will be built and connected to the grid over the next two to three years. The vast bulk will be connected by 2012.
The gate 3 process, which is in addition to that again, contains about 4,000 megawatts of renewable energy projects. Basically, EirGrid and the Commission for Energy Regulation have established a liaison group which includes the industry stakeholder associations that are looking to develop and build out that gate 3 capacity in as fast and comprehensive a fashion as possible. This is linked in, obviously, with the EirGrid 25 process and so, to accommodate that amount of renewable energy on the system, we are dependent on the EirGrid plan going ahead with its regionalised deep reinforcements to the system. Without the actual building of deep reinforcements one will not see large capacity renewable build-out. The EirGrid 25 plan is critical, therefore, from our perspective, especially to achieve our renewable electricity targets. There are no two ways about it. No deep reinforcements, no large capacity renewable build-out. It is simply as stark as that.
What about the interconnector?
Mr. Martin Finucane
The interconnector plays a role in that. By that I mean the interconnector east-west, which is on track to be built by 2012, and the North-South interconnector, the Cavan-Monaghan line, which will play a key part in being a backbone on the electricity system between North and South. All that is interconnected on the system in terms of comprehensive build-out. This is a key part of the strategy for the future.
In regard to accessing the grid through gate 3, is there any process whereby EirGrid checks whether the person or company being offered access is in a position to take up the offer immediately? As the delegates will know, in the whole land planning process there were the investors who went in, bought land and, ultimately, sold it. They got planning permission but never intended to go ahead with the actual building. They kept selling it on and part of the escalation in prices was as a result of all this. I would be afraid we might run into the same or a similar situation in terms of access to the grid. Can the delegates check whether the applicant is an investor or someone who will go ahead and build the farm?
Mr. Martin Finucane
The key trigger in that respect would typically be when a connection offer is made by EirGrid or ESB networks that is relevant to the prospective electricity developer. The connection charge deposit is in or around 10% of the connection charge, which is quite significant, so that before a project can accept a connection offer a 10% deposit must be paid as part of that connection process acceptance. That is a very significant up-front amount which was designed specifically to be high enough to make it feasible for projects to pay it at an early stage, typically a couple of years before there is any revenue stream from the project and yet is high enough to keep away casual speculators who only throw their hat in the ring to see if they can get lucky on any particular day. There is a carefully balanced deposit structure in place to help deal with that.
That said, on the gate 3 list there has already been a certain amount of this. This is a developing industry so there have been many mergers, acquisitions and takeovers in that respect. We see that where industries start off with a very large number of very small players and, typically, over the first decade of the industry being real we will see a certain amount of consolidation and more experienced players come in and start to build bigger projects and start to buy out——
What is the time period, if one is offered access?
Mr. Martin Finucane
Once a formal offer is made to a person by EirGrid there is only a matter of months to respond and accept.
Before work commences?
Mr. Martin Finucane
It depends on where one is in the country, particularly when we are considering a 2020 target and the EirGrid 25 development plan. We are now looking not only at renewable energy developers building but at the deep reinforcements being carried out over the next decade and slightly beyond. Those are the time scales involved.
A key part of this is remembering the size of the system to which we are seeking to connect all of this. Peak demand in the Irish context is around 5,200 MW which is on a once-off basis, usually in the second week of February. The summer night valley, or minimum amount of electricity our system requires to run, is around 2,600 MW, in June, July or August, when there are very still nights and not much demand for electricity. Already, there are times when the amount of wind energy alone on the system is capable of delivering in excess of 50% of electricity demand. One of the key issues on this is that in terms of wind power coming on to our system, we are very well developed in European and world terms at this level. We are probably in the top three in Europe at this stage in terms of the percentage of wind power connected to our system.
This is where the interconnectors have a role.
Mr. Martin Finucane
Absolutely, as interconnectors have a key role to play in this.
The delegates mentioned the role of landfill gases. I live very close to a very large site in Kildare which is operated by Bord na Móna and its associates. I am quite sure that it has not been tapped because the smell is something else. Which technology is most critical to the success of this plan?
Mr. Martin Finucane
Looking at a single technology that would deliver the largest capacity, one would inevitably consider onshore wind as a way of delivering our national 2020 target. To deliver that target in a low electricity demand growth scenario to 2020, we would probably need approximately 4,500 MW of renewable capacity. On a medium to high scenario we would probably need approximately 5,500 MW or 5,700 MW to deliver the target. The bulk of this would be delivered through the Gate 3 process and the vast majority is onshore wind. The Gate 3 process has approximately 4,000 MW, of which approximately 3,200 MW comes from onshore wind. It is a very significant portion.
Will the delegation comment on the bioenergy sector, and how the waste-to-energy process will enable us to reach the targets set under this plan? How does that fit under the present national waste management plan and the current infrastructure in the State?
Mr. Richard Brown
We have been dealing with the Department of the Environment, Heritage and Local Government on an ongoing basis on this for years and we are relatively up to date in what it plans. Instead of focusing on a single technology we have looked across various waste areas, and some of the concerns are in the agricultural sector. For example, there is a substantial issue with pig slurry and slaughter house waste. It is not the most edifying of subjects but the issues must be dealt with. If we can deal with such matters to make them resources rather than burdens, we can also maintain existing rural industries. In conjunction with those Departments, that is where anaerobic digestion, AD, comes in, which is the basis on which our tariff structure is made.
With the larger waste management picture, we do not deal with waste policy per se but we have a fairly good insight into what is happening and what is likely to occur. We have an open mind on what individual technologies will be applied. District heating was mentioned and in other European countries there is a substantial amount of this in cities and larger urban areas coming from waste. That is a distinct possibility in this State and we cannot discount it. Our policies, particularly the bioenergy working group report which will follow the national renewable energy action plan to an extent, will also deal with the district heating model. In the larger sense we follow the Department of the Environment, Heritage and Local Government in its priorities and support it from an energy perspective wherever we can.
Will the delegation share the insight on the proposed infrastructure?
Mr. Richard Brown
The State does not build infrastructure, for the most part, in this sector at all as it is a privatised market. There is a substantial amount of commercial interest in the AD sector now from large existing waste management companies and it is safe to say we will see a very substantial amount of capacity in that sector in the next couple of years. Some will deal primarily with municipal solid waste and others will use other forms of waste. It will happen. As everybody knows, there is also a substantial amount of biomass or municipal waste combustion planned.
With regard to financial inputs, what advice can the officials give? I refer particularly to the bio-fuels obligation and carbon credits.
Mr. Martin Finucane
The Deputy mentioned that an amount was being spent by the State in respect of carbon credits. My understanding is that because of the changing economic position in the past year or two, we have stopped purchasing carbon credits on the basis that it is now generally expected for us to be more or less compliant with the Kyoto position. The State is no longer purchasing carbon credits.
I thank the delegation for its openness and contribution. I apologise if I gave the impression that I was insulting or attacking them; I did not mean my comments in such a way. I deeply appreciate their attendance. As I noted at the outset, there are a number of questions to be listed after the meeting so we will write to the delegation. We look forward to receiving the replies.
Mr. Martin Finucane
The committee will be on our initial mailing list when the first draft of the plan goes out.
The joint committee adjourned at 4.35 p.m. until 2.30 p.m. on Wednesday, 9 June 2010.