Priority Questions
1. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources how he can facilitate the use by older persons of communications technologies; and if he will make a statement on the matter. [51573/13]
View answerOne in five adults in Ireland has never used the Internet. Many if not most of these are older people. That is why older people are a key focus in the Government's national digital strategy, which I launched earlier this year. I awarded grants in July under my Department's benefit programme to 17 community and voluntary organisations to deliver basic digital skills training to people who have never used the Internet or are seeking to build on the skills they have. The benefit programme involves a network of approximately 200 stakeholders providing training in more than 580 locations nationwide. The training covers the use of different types of communications technology, particularly Internet-related technologies such as computers and smartphones. It includes training on the topics that are most likely to be of relevance and use to people, such as sending and receiving e-mails, conducting simple online transactions and using Government services online.
Some €1.4 million has been allocated to the benefit programme in 2013. More than 83,000 people have received training under the programme since it began, with approximately 7,000 completing training so far in 2013. Approximately 60% of the people undertaking training under the latest phase of the benefit programme are over 55 years of age and one third of them are over the age of 65. Therefore, the programme is making a very positive impact on older people. The feedback received from trainees has also been positive, with 99% of them saying they would recommend the course. The latest phase of the benefit programme, which I launched in July, builds on the successes and lessons of previous phases. In response to requests from trainees, and older people in particular, the number of training hours has been increased from six to eight. The range of topics covered by the course has also been extended.
In addition to the programmes funded by my Department, a number of other initiatives are in operation to help older people to use digital technologies. Some of them are mentioned in the national digital strategy, including Google's Get Your Folks Online and Silver Surfer Towns initiatives and UPC's Internet Buttons initiative. As part of the development of the national digital strategy, my Department commissioned a number of audiovisual case studies, some of which focus on the relevance and value of digital engagement for older people, such as saving money and being better connected to friends and family. The national digital strategy sets an ambitious target to get 280,000 more people online by the end of 2016. Many of these will be older people. The strategy envisages a co-operative approach between the Government, industry and community and voluntary groups that are active in assisting elderly people. Those involved in the strategy are working with Ireland's digital champion, David Puttnam. It entails the continued roll-out of training and an intensified focus on awareness raising and motivation. The aim is to ensure more older people are shown the many great and simple things they can do with digital technologies so that they will want to engage with them.
I thank the Minister for his response. I tabled this question in the context of the abolition of the telephone allowance. We have spoken in this House on a number of occasions about the development of a two-tier society when it comes to broadband. People in their 60s and early 70s have engaged with the digital era technologies to some extent. Those in the next oldest age group are increasingly isolated and vulnerable, however, as society continues to move towards Internet banking, online payment of bills, etc. People have been asked for generations to use cash less frequently and to stop keeping it in the house. I am talking about elderly people who have not engaged properly with technological advances. Is there a coherent plan to target those people in any of the Department's various strategies? I appreciate that the cohort of people I am talking about - elderly people, in particular - was mentioned in the strategy that was launched last July.
I agree with Deputy Moynihan that we have to be very careful to ensure a new digital divide does not develop in this country. Many older people did not have access to this technology when they were being educated or during their working lives. The Deputy is right to suggest that they can suddenly become isolated. The merit of the benefit programme is that it assists such people. The programme has achieved remarkable success even though the amount of money committed to it is relatively small. Its partnership with Age Action, for example, has been exceptionally successful. I have presented awards sponsored by Age Action, sometimes in partnership with a big company such as Google, to people in their 80s who cannot believe the world that has been opened up to them as a result of being able to Skype their grandchildren in Australia, perform basic transactions online or access Government services on the Internet. I believe it is a very valuable programme.
It is. I know people in their 80s who have received awards at these ceremonies. We have to admit that the percentage of their peers in this age group who are engaging with technology and with the digital age is quite small. Older people who are active in their communities, retirement groups and day care centres are engaging with society, at least. We all know people who do not engage, however, perhaps because they have limited resources in terms of family members looking after them. These people, who are found in urban and rural parishes, are becoming further isolated. Some of them are completely isolated.
There should be a targeted and proactive programme to put people at ease. Everything can be checked online nowadays but many vulnerable people who need information have no idea where to go to find it because they do not engage in that way with society.
The figures show that 23% of the population have never accessed the Internet. The programme to which I referred has trained some 83,000 people in basic digital literacy skills. In respect of the particular cohort to which the Deputy refers, especially those who may be living in remote locations, the whole point of the benefit programme is that it sponsors these programmes in partnership with community and voluntary organisations. In those circumstances, the first step is that some kind of local organising is required, whether by the GAA or by community or residents' organisations. Those local groups are entitled to access funding and to provide courses such as those that are in place in 580 different locations.
2. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources in view of his rejection of private sector bids for Bord Gáis Energy, his views on the fact that privatisation is not a viable option and that the optimum strategy for BGE going forward is to retain and develop it in public ownership. [51805/13]
View answer4. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources his future plans for the sale of Bord Gáis Energy; the way in which the deferral of this sale will impact on the Irish energy market; and if he will make a statement on the matter. [51861/13]
View answerI propose to take Questions Nos. 2 and 4 together.
In May of this year, a process was initiated to sell the Bord Gáis Energy business. This process was led by Bord Gáis Éireann and overseen by a government steering group which included officials from my Department, the Departments of Finance and Public Expenditure and Reform, and the NewERA unit of the NTMA. I am advised that the process was conducted in a professional, open and transparent manner and attracted significant interest from a broad range of potential international buyers, reflecting the positive international sentiment towards Ireland.
However, based on clear advice, I have determined that the bids received last week were not a fair reflection of the strength and potential of the Bord Gáis Energy business. On 27 November last, I announced that I had confirmed to Bord Gáis Éireann that none of the final bids received for the Bord Gáis Energy business was of an acceptable value. The Minister for Public Expenditure and Reform and I have been clear from the outset of this process that Bord Gáis Energy would only be sold if a sale price was achieved which fully recognised the inherent value of the business. This decision underlines our commitment to proceed with asset disposals only when we are satisfied with the outcome.
My Department and NewERA will now work with Bord Gáis Éireann to ensure continued investment in the development of the Bord Gáis Energy business. We will also work with the company to complete the separation of Bord Gáis Networks and Bord Gáis Energy, as required by the EU gas market directive. This work is already well under way. Last Wednesday, the Oireachtas passed the Final Stage of the Gas Regulation Bill, which underpins the restructuring of Bord Gáis Éireann and the sale of the energy business.
The Government will keep all options open as regards the future of Bord Gáis Energy, which is a growing and successful business. I am confident that regardless of its ownership structure, Bord Gáis Energy will continue to enhance competition in the all-island energy market for the benefit of the economy and consumers. The continued roll-out of the Bord Gáis wind generation portfolio will also help to ensure that Ireland meets its legally binding renewable energy targets, as well as building further value in this business.
The Government remains committed to retaining Bord Gáis Éireann’s gas networks and interconnectors in State ownership as strategic infrastructure. We are also continuing our programme of divesting non-strategic assets, the proceeds of which will be used for re-investment in support of employment and economic recovery.
I am very disappointed with the Minister's response. When it was first proposed that Bord Gáis Éireann would be sold off I predicted that the venture capitalists, or vulture capitalists as I called them at the time, would be swooping and looking for a basement bargain. I also pointed out that the privatisation of public utilities in the neighbouring island had been nothing short of disastrous and had resulted in poorer service and increased costs to consumers.
We need to remind ourselves why these companies were in public ownership in the first place. We need to put ourselves in the place of a board of directors or managers at Bord Gáis Éireann. How can any company engage in strategic or even short-term planning when the status of that company is uncertain? I am disappointed that the Minister has not said that the reasons it was set up as a public company in the first place are as valid today as they were then and that the door has been closed and locked on any privatisation of Bord Gáis Éireann.
Fianna Fáil opposed the sale of the company in the first instance and we raised concerns during the passage of the Bill. What has been the cost to the Exchequer in the process of preparing the company for sale?
It seems there is nothing I can do to make Deputy Colreavy happy.
The Minister could say that he is not going to privatise the company.
He does not want me to sell the energy business of Bord Gáis, yet when I do not sell it he is also unhappy. I am sorry about that, but I think it was the right decision because we did not get value in so far as we regard the energy business of Bord Gáis as a very good business. We made plain from the beginning that unless we got value we would not sell. It would appear that some people inside and outside the House did not believe that. The origins of why we are doing it have been well traced and I will not go back over them.
I cannot answer Deputy Moynihan's question because we do not yet know the position with regard to fees. Individual contracts were issued following a competitive tendering process and some of it was on a no-foal-no-fee basis. Therefore, figures are not yet available, but I will inform the Deputy as soon as they are available.
The Minister says it is impossible to make me happy, but that is not true. I welcomed the decision not to sell the company off to the bargain basement hunters. However, I am pointing out that privatisation would be detrimental to this company and to the people of Ireland, and there are ample examples - remember Eircom - in which privatisation damaged a utility that the public had enjoyed. The people of Ireland paid for this company. I argue that it is impossible for any company to plan for the future when its status is unknown. If the Minister wants to make me completely happy, there is a very easy way to do it. He should close the door and lock it on the future sale of Bord Gáis Éireann, because it would be the right thing to do.
There is an issue with regard to the privatisation of State companies in general. We have learned hard lessons from past experience with these companies. There is no benefit to the State in dealing with the lowest bidder, the lowest common denominator. Any privatisation of State companies should be put on the slow burner.
There are people who are trying to get it at the lowest possible cost. We should not be bargain selling.
Deputy Moynihan is correct in that market conditions are affected by various developments, not least the shipping of cheaper coal into Europe by the US as a result of the revolution in prices therein arising from the exploitation of shale gas. This is just one of the factors affecting gas market conditions to which the Deputy referred.
Deputy Colreavy raised a comparison with Eircom. We learned from the mistakes made in that case and we have retained the networks in State ownership. In the case of Bord Gáis, there is a parent company and essentially three subsidiaries, those being the networks company, the energy business and Irish Water. They are under the umbrella of Bord Gáis Éireann. All three are prospering. Irish Water will be a significant company in its own right. The legislation that we completed last week has the energy business as a stand-alone company, stripped out from the networks. If someone comes along and makes an offer that the Government believes is value for what is being purchased, we will consider it because of the agreement entered into with the troika and so on. Just in case anyone fears that there will be a fire sale or a sale of any State asset at a bargain basement price, it will not happen.
Deputy Colreavy is right in stating that the energy business of Bord Gáis is thriving. It will continue to expand and is providing valuable competition. It will not be impeded in the slightest by the fact that it constitutes a separate energy company in BGE's stable, like Irish Water and the networks company.
3. Deputy Richard Boyd Barrett asked the Minister for Communications, Energy and Natural Resources if he has any knowledge of actual production of oil from the Connemara field; and if he will make a statement on the matter. [51906/13]
View answerTime and again the Minister has told the House that the justification for a low tax regime on oil and for licensing arrangements whereby ownership of our gas and oil reserves has effectively been handed over to oil companies is that we only have potential reserves, not actual reserves. If that is the case, could he explain how this jar of light crude oil, just a small sample taken from a tanker-----
We do not display items in the Chamber.
I will put it down. An oil tanker was filled-----
Could we have the reply, please? The Deputy's time has concluded.
-----in 1997. A week's pumping filled a tanker. Where did it go, who took it and did we get any money for it? This is real oil, not potential oil.
The Deputy's 30 seconds are well up. In case the Minister of State is not aware, as this is his first Question Time since the change-----
It is.
-----it is now open to a Deputy by right to use up to 30 seconds, if he or she wishes, to explain the question.
We are getting more democratic every day.
I am delighted that Deputy Boyd Barrett has raised this issue. I will happily confirm to him that the Connemara field was subjected to an extended well production test by Statoil between July and September 1997. The test involved regular stopping and restarting of the flow from the well, which was named block 26/28-A1Z, to test flow rates and reservoir pressure levels. Stable flow rates were never achieved throughout the test. The decline in reservoir pressure observed from only a limited volume of production, coupled with the slow build-up in reservoir pressure following the production period, confirmed that the well was incapable of sustaining commercial production rates.
Oil recovered from the test was transferred directly to the tanker Berge Hugin instead of being flared off. The cumulative volume of oil recovered during the entire 69-day test was 16,500 barrels. The well was not commercially sustainable. Since exploration began in the Irish offshore in the 1960s, there have been a number of non-commercial discoveries, including the Connemara field. There have been no commercial discoveries so far.
In 1997, as part of the full field development of the Connemara field, Statoil drilled two appraisal wells. Neither was found to be commercially viable. On the basis of the results of the appraisal programme, the wells were plugged and abandoned and Statoil decided not to proceed. It relinquished the acreage to the State in October 1999.
The story shifts as we investigate further. I will quote something that the Minister, Deputy Rabbitte, told me a while ago. He stated: "Since the early 1970s, we have had four gas finds and no oil finds."
Commercial finds.
Yes.
He did not say "no commercial oil finds". He said "no oil finds". Now it is "commercial". However, we have discovered that a tanker of oil was pumped out of the Connemara field. Although it was plugged, one of Statoil's then directors, Mr. Stein Bredal, has since stated publicly that doing so was a mistake, as technology has caught up to the point at which the pressure problem can be addressed. I presume this is the reason other oil companies still have an interest in the area. They know there is not potential oil down there, but real oil. They are waiting for an opportune moment to extract it, just as property developers sat on land banks for ages-----
I thank the Deputy. I will allow him to contribute again.
-----until they could get maximum profits.
It is exceptionally obvious that if the company had found commercial oil it would have developed it. That it handed the licence back to the State meant it did not believe there was potential at the time, notwithstanding the fact that some oil was found.
We are trying to get more companies to go into such fields along our coast. We announced recently that we would open the Atlantic margin for a new run next year. We want more companies to get involved. This and next year we will have spent €20 million on studying the geological and seismic conditions. This will make it easier to identify sites that may have the potential to be exploited, given the changes in technology. No one is sitting on the oil because no one has it. That company handed back its licence.
One of Statoil's former directors has since said that handing the licence back was a mistake, as modern technology allows-----
I am sorry, but this is Question Time. We ask questions.
I am asking a question. The former director has acknowledged that it was a mistake and that the field could be commercially viable. Can there be a justification any longer for the ridiculously and pathetically low tax rate, the lack of royalties and the effective handover of ownership, through our licensing system, to private oil companies of a reserve of oil that will almost certainly be commercially extractable and profitable in the very near future, if not this minute? We know the oil is down there. It is only a matter of time before it is extracted. Under the current regime we will get nothing from it. We will probably get as much as in a little container of oil.
Earlier this year, I examined drilling activities by Exxon-Mobil 165 kilometres off the west coast. The company spent $150 million on that drilling operation but found no active hydrocarbons. In other words, no commercial hydrocarbons were present there. Therefore, it is not a matter of giving it away, it is a question of companies taking a punt on where they think is the best place to go. My Northern Ireland counterpart and myself have agreed to examine new terms for the future. I have taken on board the issue of taxation on oil revenues which was raised in the report of the Oireachtas Committee on the Environment, Culture and the Gaeltacht.
That matter is out for tender at the moment and we will make a decision on it early next year. The key point is, however, that there have been no commercial oil finds to date. We are encouraging private companies to come in and exploit. We are looking at current and future terms, but not retrospectively. One of the Oireachtas committee's recommendations was that if changes are to be made, they would not be retrospective. We are competing in a difficult field with Norway and other countries. If a company has $150 million to spend and goes for a strike in Norway or Britain, it has a far higher chance of succeeding than off Ireland. We are re-examining the terms but there are no hidden reservoirs that somebody has their hands on and will press a button to activate sometime in the future. Companies want to come here to spend money and exploit that resource. We are happy with that and are encouraging them in. This year, there are more companies interested than ever before.
I am sorry but there is a time limit.
In 2011, 13 licensing options were given. Some 12 of those are converting into frontier exploration licences, which is positive and constructive. We welcome the companies' commitments.
Question No. 4 answered with Question No. 2.
5. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources his views on whether this State needs to achieve its targets for renewable energy production and self-sufficiency in electricity generation prior to initiating the large scale export of energy generated from renewable sources. [51806/13]
View answerThe 2009 EU Renewable Energy Directive outlined targets for member states for renewable energy penetration. The directive set Ireland a binding target where at least 16% of our energy requirements should come from renewable sources by 2020. In order to meet our overall 16% requirement, Ireland is committed to meeting 40% of electricity demand, 12% of heating and 10% of transport from renewable sources. The directive also provided the option of co-operation mechanisms to enable a member state to contribute to another member state’s targets.
To date, wind energy has been the largest driver of growth in renewable electricity, contributing most towards the achievement of the 2020 target. In 2012, 15.3% of Ireland's electricity demand was met by wind generation. At the end of quarter three this year, the total amount of renewable generation connected to the grid was approximately 2,100 MW. It is estimated that a total of between 3,500 and 4,000 MW of onshore renewable generation capacity will be required to allow Ireland to meet its 40% renewable electricity target. Currently, approximately 3,000 MW of renewable generation has taken up connection offers under the Gate 3 grid connection programme.
Expert advice has identified Ireland’s potential to produce renewable electricity significantly beyond the level required by the 2020 target, along with the capacity to meet that 2020 target from onshore renewable generation alone.
Ireland’s capability to achieve its national targets for renewable electricity from onshore renewable generation alone, with capacity to spare, means that there is potential for projects of scale onshore that are aimed at export markets. It also means that our offshore wind resource can be developed as an export opportunity.
It is in this context that the opportunity to harness Ireland’s onshore and offshore renewable energy resources for the export market, and realise their potential for investment, job creation and economic growth, has been identified and is being pursued with the UK Government under the memorandum of understanding on energy trading signed in January 2013.
The Minister has previously stated that the export of wind energy will not interfere with achieving our targets, but there is a broader issue. We should aim for self sufficiency before we export energy generated by wind power. In the longer term the export of energy is a valid and potentially beneficial objective, but self sufficiency should come first. Five or six months ago I asked the Minister what financial arrangements had been reached with the British Government on exporting energy from the midlands. At that time, the Minister replied that no financial arrangements had been made but there was a memorandum of understanding. It must be a matter of concern to the Minister, as it is to all of us, that the British Government announced yesterday that it will reduce subsidies for land-based turbines, while increasing subsidies for offshore ones. I expect that will have an impact on whatever negotiations have been or will be held concerning the export of our energy to the neighbouring island.
The Deputy is correct. The memorandum of understanding between myself and the UK Secretary of State for Energy, Mr. Edward Davey, was a statement of intent on an intergovernmental agreement, which we are required to do under the relevant European directive if we are to open up a traded sector between this country and Britain. It did not deal with the matter of a strike price because it could not. We did not have the information and there was no template to do so when the memorandum of understanding was concluded. Since then, however, we have been working on the matter intensively on our side. It is coming to the stage where that issue will have to be confronted in the next couple of months. As I have said in this House, and Mr. Davey has said in the House of Commons, everything depends on the economics stacking up. We both believe that the economics will stack up because it is a more economic and feasible option for Britain to source energy here than offshore. In those circumstances the expectation is that they will stack up. We are satisfied that we can meet our domestic targets with something to spare. Therefore if we have a capacity to generate more electricity than we need for domestic consumption, it would make sense to seek a market for it. Our country lives by trading goods and services, so if we can open up a new and hitherto unheard of market that brings wealth and jobs to Ireland, we think that is a good thing.
The Minister has not addressed the fact that just yesterday the British Government announced it will reduce subsidies on land-based turbines, while increasing subsidies on offshore turbines. This could be seen as Britain being quite prepared to spoil the Irish environment because it was not permitted to spoil its own one. Britain is also prepared to receive energy supplies from Ireland and the worst part is that there is no financial agreement yet. It looks as if a commitment has been made to supply a certain level of energy to Britain, without agreeing how much. It is like selling a car to somebody without agreeing the price in advance. When will we know what financial arrangements will be made on foot of this memorandum of understanding? Does the memorandum of understanding explicitly commit us to a certain level of supply to the British Government, even though we have not reached any agreement on the financial arrangements?
If Deputy Colreavy worked at it, he could not get the wrong end of the stick more perfectly than he has done there. How in the name of heaven can we agree a strike price until we know exactly what it is that we are trading? There is no template for this and nothing has been done.
Not one single turbine has been erected and no irrevocable commitments have been entered into. Nothing is agreed until everything is agreed. The financial terms are obviously at the heart of this issue. I do not know from where Sinn Féin's hostility to trading energy supplies with Britain comes. I have been told that the Sinn Féin Party does not have a difficulty in trading beef, pork, computers and so on with Britain. What is the problem with trading green energy supplies with it if it is economic for us to do so? We will assess whether it is economic for us to do so when the terms are agreed to.
