I move: "That the Bill be now read a Second Time."
It is my great pleasure to commence the Second Stage debate of the Sustainable Energy Bill in the Dáil. The Bill has been passed by the Seanad where it received a broad welcome. I now look forward to an interesting debate on this important issue in this House.
Enactment of the Bill will impact on the vital issue of sustainable use of energy. It will also impact on the need to supply energy to a rapidly growing economy without continuing adverse effects on the environment. It is important to set out my definition of sustainable energy because sustainability is central to my efforts in this Bill and my efforts elsewhere in the energy field. In the Green Paper on Sustainable Energy sustainability is defined as ensuring that the needs of present generations can be met without compromising the ability of future generations to meet their needs. I set out in the Green Paper that a sustainable energy policy should: ensure security of energy supply in order to support economic and social development while protecting the environment; maximise efficiency of generation and emphasise the use of renewable resources; promote energy conservation by users; minimise emissions of greenhouse gases and other pollutants, both by clean generation and by sustainable consumption levels in all sectors; and maintain local air quality and limit and reduce the Irish contribution to regional and global environmental problems.
The principal objective of the Bill is to establish the necessary legislative framework to allow the Irish Energy Centre to operate independently of Enterprise Ireland as a statutory body and to effect a change of title for the centre to the Sustainable Energy Authority of Ireland. Needless to say, the Irish Energy Centre is central to the Government's plans to respond to the sustainable energy challenge as well as our obligations under the Kyoto Protocol.
I would like to give Deputies some background to the formation of the Irish Energy Centre. In 1995, as a joint initiative the Department of Public Enterprise and the agency formerly known as Forbairt, now Enterprise Ireland, established the centre. A Memorandum of Understanding between the Department of Public Enterprise and Forbairt underpinned the position of the centre as a unit within Enterprise Ireland. That Memorandum of Understanding was intended to be an interim measure only, a step in the evolution of the centre into an independent, operationally autonomous agency. The Bill before the House will serve to clarify and improve the strategic direction of the centre and allow it the flexibility to develop its full potential as one of the significant implementing agencies in the Government's strategy on climate change and the promotion of energy efficiency measures and renewables. Enactment of the Bill will be an important step in the context of giving real intent to the Government's energy efficiency policies in a liberalised energy market.
The Green Paper on sustainable energy, which I published in September 1999, proposes a framework for energy efficiency and the promotion of renewable energy in Ireland. It sets out policy for both limiting energy related COf8>2 emissions and promoting the use of renewable energy sources to help ensure Ireland's compliance with the UN Kyoto Protocol on reducing greenhouse gas emissions. The centre is central to the implementation of many of the programmes and measures set out in the Green Paper.
It might be opportune to give the up-to-date position on the Kyoto Protocol at this stage. The adverse effects of climate change are well documented and the publication of the third assessment report to coincide with the resumed negotiations in Bonn in July served to emphasise how these effects are becoming more prevalent. The EU member states are committed to maintaining a firm common position on the protocol and attended the resumed climate change negotiations in Bonn in July and the COP7 negotiations in Marrakech last month prepared to engage in meaningful dialogue with other parties. This determined attitude to finalise the technical details which remained to be resolved in order to make it possible for parties to ratify the protocol next year was rewarded with success in Marrakech and has cleared the way for ratification of the protocol next year. As evidence of this Government's continued commitment to Kyoto, my colleague, the Minister for the Environment and Local Government, in a speech in Marrakech, committed Ireland to ratification of Kyoto in 2002.
The agreements at Bonn and Marrakech also pave the way for the ratification of the protocol in 2002, as originally scheduled; hence the added urgency to this legislation in terms of meeting our overall commitments. Under the terms of the Kyoto Protocol, Ireland has agreed to limit greenhouse gas emissions to 13% above 1990 levels. Our greenhouse gas emissions are currently more than 20% above 1990 levels. The latest ESRI forecast contained in its medium-term review suggests a significant rise above 1990 levels in our emissions by 2010 if we continue on a business as usual basis, principally as a result of our rapid economic growth. Energy related greenhouse gas emissions accounted for 55% of total greenhouse gas emissions in 1990 and are forecast to increase to 63% in 2010 if we do not devise policies and measures to abate such emissions.
These are stark statistics, which we cannot ignore. There is too much at stake for us and for future generations. The Government's national climate change strategy, published in October 2000, establishes the framework within which we will seek to achieve the necessary cuts in emissions. The strategy, like the Green Paper on sustainable energy, foresees a major implementing role for the centre. When introducing the Bill to the Seanad, I paid tribute to staff of the Irish Energy Centre. Most of us are aware of the excellent work they do in the area of energy awareness through energy awareness week, car free day and their excellent schools programme. However, I also put on record their work over the period of the economic infrastructure operational programme. In particular, the contribution made under such programmes as the energy efficiency investment support scheme and the self audit scheme was brought to the attention of Senators. I wish to repeat that tribute in this House.
The legislation provides that all the staff currently working in the Irish Energy Centre will become members of the staff of the new authority. The current staff of the centre are either permanent or contract staff of Forfas. It is essential that the majority of the existing staff switch to the new authority. Their dedication, experience and expertise is vital to the new organisation. I am satisfied that the provisions of the legislation in relation to tenure of office, terms and conditions, salaries, and superannuation ensure that all current staff of the centre move to the new authority with conditions no less favourable than those they enjoyed as members of the staff of Forfas. It is only to be expected that some staff might have concerns in relation to these issues and others such as career paths, promotional outlets, and opportunities for training and development.
These issues must be addressed quickly and addressed with openness and frankness as to the opportunities a transfer to the new authority will present. In recognition of that need, I have set up a consultative forum to address these issues. The forum, which is meeting regularly, consists of senior officials from my Department, the relevant trade union representatives of the staff, and Enterprise Ireland. With the necessary dialogue and goodwill on all sides these matters can be resolved to the satisfaction of existing staff. We are endeavouring to provide the utmost clarity for existing staff of the centre. I assure this House, and the staff in question, that as an independent body under the aegis of my Department, the ethos of the new authority will be one with a strong human resource focus and a commitment to the proper training and development of all staff. This is a situation where we can truly say that the experience and expertise of staff is the most valuable resource of the centre. We will ensure that the new authority manage and develop that resource accordingly.
On account of the mammoth task facing the new centre, and as I was conscious of the need to have the necessary institutional arrangements in place immediate on the enactment of this legislation, I appointed an interim board for the centre last December. Professor Frank Convery of the Environmental Research Unit in University College Dublin is chairperson of the interim board. I am delighted with the progress made by this board in carrying out its mandate to oversee the transition of the centre from Enterprise Ireland and examining institutional issues such as structure and staffing arrangements. The interim board has had a number of meetings and is currently meeting on a monthly basis in order to progress the many issues that arise. Considerable work has been done, for instance, in developing a three-year work programme, which was recently approved by the board. The bulk of that programme is based on the funding provisions of the economic and social infrastructure operational programme within the framework of the National Development Plan 2000-2006.
The interim board was instrumental in ensuring that a professional study was carried out in order to ensure a structure and staffing level appropriate to the proposed mandate for the new authority. As a result, the centre has sanction for a new structure and 30 additional posts that will bring the staff complement to 50. The centre is currently engaged in the first phase of the recruitment process. Some 15 new staff members will be recruited before the end of this year.
I look forward to the new work programmes of the centre getting under way. In June of this year, I launched an energy efficiency scheme in public sector design studies followed by the second phase, the model solutions investment support scheme, in August. A third phase of this programme, support for energy management bureaux operations is being planned. When one considers that the public capital programme for 2001 provides for expenditure of 7.6 billion, of which approximately 1.9 billion relates to expenditure on new buildings and major refurbishment of existing buildings, one can see how important this is.
I launched a major research and development scheme, entitled the House of Tomorrow Programme on September 26 of this year. This programme, which has a proposed budget of 21.1 million, offers support for research, development and demonstration projects aimed at generating and applying technologies, products, systems, practices and information leading to more sustainable energy performance in Irish housing.
I have already mentioned the important work being carried out in the area of energy awareness. I believe that many Deputies agree with me when I say that much can be achieved in this area. There is no cheaper solution to the energy emission problem than the conservation of energy and the careful use of energy by all. I firmly believe that it is possible to change the lifetime habits of a society. I am satisfied that with effective awareness campaigns and proper education the harmful effects of wasteful use of energy can be reduced. Evidence of this can be seen with the annual energy awareness week which is held in October each year and is co-ordinated by the centre. It remains the single most important platform for promoting energy efficiency in Ireland. The primary target audience is household consumers. The campaign informs them of how much energy is used on a domestic basis and the potential for savings there, from where this energy comes and the longer term implications of current consumption trends.
The week has proved very successful in raising awareness of the sustainable use of our energy resources and research indicated that consumer investment in specifically targeted energy efficient products increased by 680% during the period of the Energy Awareness Week campaign in 2000. The Energy Awareness Week 2000 campaign resulted in additional energy savings of over 2.5 million being achieved in Ireland. This represents a reduction in C0f8>2 emissions of 21,500 tonnes per annum.
Speaking of education, this is where I believe real progress can be achieved. I would like, for instance, to see a comprehensive campaign for schools developed for teachers and students starting with the junior schools and working up to secondary and beyond. I know, and I am pleased, that the centre is working hard on developing its website and making effective use of the Internet to promulgate the message. We are all aware of how adept children are in the use of modern technology so I applaud the efforts of the centre in this regard. I am looking forward to and I am excited by the prospect of future developments in the centre's schools programme.
In keeping with the definition of sustainable energy I outlined for Members earlier, Members will know that action is required on a number of fronts. I am a great believer in the role that can be played by renewable energy. In the Green Paper I set a much increased target of 500 megawatts of electricity for the contribution of renewable energy towards our Kyoto obligations. In May of this year, I had the pleasure of announcing the fifth alternative energy requirement competition. Under AER V, I am providing market support at various prices for a number of renewable technologies, including large scale wind energy, small scale wind, biomass and small scale hydro power. The amount of capacity on offer, at 255 megawatts, is the largest yet under an AER programme. It is just over half the target I set for the period up to 2005 in the Green Paper on Sustainable Energy. It is more than double the initial offer in AER III.
In announcing the competition I said the achievement of the target will generate sufficient electricity to feed 180,000 domestic houses, prevent the emission of over one million tonnes of polluting greenhouse gases into the atmosphere, save on the import of more than 300,000 tonnes of crude oil and other fossil fuels, contribute savings equivalent to almost 10% of our Kyoto obligation and create an investment opportunity in excess of 254 million.
The announcement of AER V is a practical demonstration of my resolve and that of the Government to promote the renewable energy sector. It is also self-evident renewable energy can be foremost among the solutions needed to meet our Kyoto obligations. In concluding this point I should record that the accelerated programme I am implementing builds on the pioneering work on the promotion of renewables commenced by my predecessor in this office, Deputy Stagg. I have been pleased to acknowledge the contribution by Deputy Stagg in other fora, in particular at a recent wind energy conference in Kilkenny.
I would like now to deal with some aspects of the Bill other than those relating to staffing and terms and conditions of employment which I have already mentioned. The functions of the new authority are set out in a comprehensive way in section 6 of the Bill. Its functions are essentially to promote and assist energy efficiency measures across the whole economy, to assist and promote the development of electricity generation from renewable sources and, importantly, to advise Ministers in all matters relating to its functions. In this respect, I would foresee that the authority would provide crucial input to future policy development in the area of sustainable energy.
The accommodation needs of the new authority are dealt with in section 20. For clarity, I will set out the background to its current accommodation. Currently, the centre is located in a purpose built energy efficient building in the Enterprise Ireland complex in Glasnevin. The site is wholly owned by Enterprise Ireland. Under the original memorandum of understanding, which established the centre, Enterprise Ireland undertook to provide the necessary accommodation. A site was provided and a specially designed building was constructed on it with European Union funding.
A number of issues now arise in relation to the Glasnevin site. First, Enterprise Ireland intends to relocate its entire staff, currently located in a number of offices throughout the city, to the Glasnevin site. As one would expect, this will result in an evaluation of the buildings, structures and accommodation already on the site. Second, the current Irish Energy Centre building will need to be extended to house the proposed increase in staff. Third, there is the consideration that the new board may wish to ensure its independence from Enterprise Ireland physically as well as statutorily.
In response to the many considerations affecting the Glasnevin site, it was necessary to find a solution, which, on the one hand, would ensure that the authority would have accommodation for its staff on vesting day and, on the other hand, would enable Enterprise Ireland to retain ownership of the entire site. I decided, with the approval of the Government, that the new authority should be given a licence to remain in its existing building at least until there is greater clarity as to the intentions of all the main parties towards development of the site. Needless to say, the accommodation issue is one that is exercising the minds of Professor Convery and the other members of the interim board and I understand from the chairman that the issue is high on the agenda of the interim board. Section 20 provides that the authority is to be given a licence to remain as tenant in its existing accommodation with effect from vesting day.
With regard to the financing of the new authority, the Bill, in section 21, provides that the Minister shall from time to time, with the consent of the Minister for Finance, advance to the centre out of moneys provided by the Oireachtas such sums as the Minister may determine for the purposes of expenditure by the centre in the performance of its functions. Provision is made in the National Development Plan 2000-2006 for an allocation of 185 million over the duration of the plan for the purpose of increasing energy efficiency and promoting renewable energy related initiatives. This funding is intended to support the measures outlined in the Green Paper on sustainable energy. Particular emphasis is placed on the promotion of energy efficiency measures, research and development, renewable energy-combined heat and power, and energy efficient houses and public sector buildings. An element of that funding relates to the day to day activities of the new enlarged centre. Funding arrangements for the new authority are therefore largely in place.
I will bring forward some minor amendments to the Bill on Committee Stage. In particular, I will make amendments to Section 39 of the Electricity Regulation Act, 1999, to amend the provisions in that Act relating to the public service obligation. Many Deputies will be aware that the Minister for Public Enterprise, Deputy O'Rourke, proposes to introduce a public service obligation, order under the 1999 Act, requiring the ESB to purchase the output of certain peat and renewable electricity generating stations.
This PSO has particular relevance to my policy on the promotion of renewable energy, which I referred to earlier. During prolonged discussions with the EU Competition Directorate on the State aid aspects of the PSO, it emerged that the PSO funding mechanism, as had been provided for in section 39 of the 1999 Act, which is based on the consumption of electricity by final customers, would have a distorting impact on Irish electricity market. It is therefore necessary to amend section 39 of the 1999 Act to ensure that the enabling power for the PSO complies with the EU Commission decision approving the PSO. While these amendments will not have any material impact on the public service obligations, they are necessary from a technical perspective.
I am signalling my intention to bring forward an amendment on Committee Stage to increase the borrowing powers of Bord Gáis Éireann. I had initially proposed providing for this increase in the Gas (Interim) (Regulation) Bill, 2001. However, due to unforeseen delays in the progress of that Bill and the urgent need for this provision, I am now proposing to use the Bill before the House as a vehicle for bringing this matter forward. The current borrowing limit of 698 million is set out in section 23 of the Gas Act, 1976, as amended. This needs to be increased urgently to accommodate BGE's large capital expenditure requirements over the next two years and the proposed amendment provides for increasing the borrowing limit to 1.1 billion. The capital expenditure is related to the upgrading and expansion of the existing gas transmission and distribution networks. This includes major infrastructural projects such as the pipeline to the west and the second Scotland-Ireland interconnector which is required to ensure security of energy supply for the winter of 2002-03. My proposal to include the relevant amendment in this Bill is based on the fact that BGE has already started work on these projects and will need to take advantage of the increased borrowing limits shortly.
I look forward with great anticipation to the establishment of the new authority. The interim board has already given us a feeling for how energetic the new authority will be. I am encouraged by the enthusiasm being shown by existing staff and the boost that will be given by the infusion of new staff over the coming months. I am more satisfied than ever that we are going in the right direction.
I commend the Bill to the House.