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Alternative Energy Projects.

Dáil Éireann Debate, Tuesday - 8 February 2005

Tuesday, 8 February 2005

Questions (19, 20, 21, 22, 23, 24, 25, 26, 27, 28)

Paul Connaughton

Question:

71 Mr. Connaughton asked the Minister for Communications, Marine and Natural Resources the extent to which it is Government policy to support the production of bio-diesel or other non-fossil fuel alternatives; his preferred options in this regard for the future; and if he will make a statement on the matter. [3691/05]

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Bernard J. Durkan

Question:

306 Mr. Durkan asked the Minister for Communications, Marine and Natural Resources the extent to which it is Government policy to support the production of bio-diesel or other non-fossil fuel alternatives; his preferred options in this regard for the future; and if he will make a statement on the matter. [3970/05]

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Written answers

I propose to take Questions Nos. 71 and 306 together.

My Department is responsible for the promotion and development of renewable energy, including biofuels, and I am committed to the development and promotion of a biofuels market in Ireland's transport fuel sector. An interdepartmental group has been set up chaired by my Department and comprising officials from Sustainable Energy Ireland, SEI, the Department of the Environment, Heritage and Local Government, the Department of Transport, the Department of Agriculture and Food and the Department of Finance. The group is considering policy options for the development of a biofuels sector in Ireland.

As part of the work of this group, a liquid biofuels strategy study was published by SEI in December, which examines the full range of options and potential supports for liquid biofuels development in Ireland, including bioethanol, biodiesel and pure plant oil. The report is being considered as part of the overall policy objective to increase market penetration of biofuels in Ireland, which is at a very low level. The biofuels directive sets indicative targets for market penetration of 2% by end 2005 and 5.75% by end 2010. These targets present a challenge to Ireland, given the low base from which we are starting.

In March 2004, my Department secured an amendment to the Finance Act 1999, which provides for the introduction of a scheme for excise tax relief for biofuels. The purpose of the scheme is to allow qualified and conditional relief from excise of biofuel used in approved pilot projects for either the production of biofuel or the testing of the technical viability of biofuel for use as a motor fuel. It is envisaged that the scheme will encompass market development for pure plant oil, biodiesel and bioethanol.

The European Commission has confirmed that the scheme would represent a state aid and consequently its approval is required. In this regard, the Department of Finance has written to the Commission seeking approval. Once the necessary clearance is granted, a commencement order will be signed by the Department of Finance and the process for project selection and approval will be implemented.

Sustainable Energy Ireland is also funding a number of biomass projects and studies through its renewable energy research development and demonstration, RERDD, programme. Under the programme, Sustainable Energy Ireland offers capital grant aid for biofuels market demonstration projects in the pure plant oil, biodiesel and bioethanol categories.

Jan O'Sullivan

Question:

72 Ms O’Sullivan asked the Minister for Communications, Marine and Natural Resources if his attention has been drawn to the recent statements from a company (details supplied) that it will not be developing any further wind projects here; his views on whether such statements are a direct response to the energy regulator’s comments that there is no need to develop the wind energy sector at this time; and if he will make a statement on the matter. [3591/05]

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Brian O'Shea

Question:

74 Mr. O’Shea asked the Minister for Communications, Marine and Natural Resources his views on the opinion of the electricity regulator that there is no need to further stimulate the wind energy sector at this time; if Ireland remains on course to meet the 13.2% of all energy coming from the renewable sector target by 2010; and if he will make a statement on the matter. [3590/05]

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Bernard J. Durkan

Question:

76 Mr. Durkan asked the Minister for Communications, Marine and Natural Resources his plans to support or encourage the production of alternative energy with particular reference to wind energy in the aftermath of the recent comments of the regulator; if he has given any direction in this regard or intends to so do; and if he will make a statement on the matter. [3564/05]

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Simon Coveney

Question:

98 Mr. Coveney asked the Minister for Communications, Marine and Natural Resources his targets to achieve less dependency on fossil fuels and the development of alternative energy sources; his plans to offer incentives in this area; and if he will make a statement on the matter. [3641/05]

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Dan Boyle

Question:

152 Mr. Boyle asked the Minister for Communications, Marine and Natural Resources when he expects to complete his review of future support mechanisms for renewable power sources; if a decision on the new support measures which need to be put in place has to await the conclusion of his wider review of the electricity market. [3676/05]

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Michael Noonan

Question:

155 Mr. Noonan asked the Minister for Communications, Marine and Natural Resources if he has had discussions with the regulator in regard to the development of alternative energy sources; the extent to which he expects such sources to contribute to national energy requirements in the future; and if he will make a statement on the matter. [3651/05]

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Bernard J. Durkan

Question:

303 Mr. Durkan asked the Minister for Communications, Marine and Natural Resources his targets to achieve less dependency on fossil fuels and the development of alternative energy sources; his plans to offer incentives in this area; and if he will make a statement on the matter. [3967/05]

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Bernard J. Durkan

Question:

307 Mr. Durkan asked the Minister for Communications, Marine and Natural Resources if he has had discussions with the regulator in regard to the development of alternative energy sources; the extent to which he expects such sources to contribute to national energy requirements in the future; and if he will make a statement on the matter. [3973/05]

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I propose to take Questions Nos. 72, 74, 76, 98, 152, 155, 303 and 307 together.

The existing AER VI program marks the end of the current market support for renewable sourced electricity generation. The Department conducted a consultation process on future development of renewable energy which attracted 47 responses last year. To ensure future development of our renewable resources the renewable energy development group was established on 6 May last year. The group is chaired by my Department and comprises relevant experts from the administrative, industry and scientific sector, including the Commission for Energy Regulation, CER, Sustainable Energy Ireland, SEI, ESB national grid and the Economic and Social Research Institute, ESRI, among others.

The group is at the end of its current work phase and its report is expected to be ready shortly. The work of the group has been informed by the renewable energy consultation process and the submissions made in response to our consultation document. Other inputs to the group came from direct presentations to the group from industry representatives and their associations; analysis conducted by sub-groups of the group itself; the work of the CHP strategy group and the bioenergy strategy group. In the course of the work of this group a wide spectrum of views and opinions were expressed by the parties involved and the views recently submitted to me by the energy regulator will be considered alongside all other views received.

In the interests of clarity and transparency, I have put out to consultation the recently expressed view of the Commission for Energy Regulation, which is an independent body under paragraph 9 in the Schedule to the Electricity Regulation Act 1999, and several replies have been received to date in response to the views outlined in the letter. I have had no specific discussions in regard to the development of alternative energy sources with the Commission for Energy Regulation nor do I have power to issue directions to the commission of the type referred to by Deputy Durkan. From my point of view, it is important to optimise the contribution of wind energy based electricity to the national supply on a basis that is fair to all parties, including consumers, and that it can be integrated safely and easily into the national network.

It is important that the State reduces its dependency on non-renewable fuels, whose prices are subject to the vagaries of the global markets and geopolitical developments which can adversely affect both the price and availability of supplies. From a national economic perspective, not just an energy policy perspective, increasing the amount of renewable energy in the system will be helpful in substituting costly fuel imports and in dealing with levels of uncertainty in the future evolution of energy prices.

I am aware of reports that the specific company referred to has decided to invest in other locations for now. That is purely a commercial decision for the company involved.

The renewable energy development group will advise on future options on policies, targets, programmes and support measures to develop the increased use of renewable energy in the electricity market to 2010 and beyond. The group's report, which is due shortly, will form the basis of my future policy decisions on the increased penetration of renewable energy technologies in the electricity market and will seek to ensure that developers can make a reasonable rate of return on renewable energy projects while ensuring that the interests of national competitiveness and the ultimate burden of cost to the final consumer are fully taken into consideration.

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