Vol. 625 No. 6
6 Mr. Penrose asked the Minister for Communications, Marine and Natural Resources the details of plans to develop an east-west interconnector; if a decision has been taken on whether it will be developed on a regulated or hybrid regulated or merchant basis; and if he will make a statement on the matter. [33425/06]
34 Dr. Twomey asked the Minister for Communications, Marine and Natural Resources the plans he has for the provision of east-west electricity interconnectors; the number, capacity and location proposed; and if he will make a statement on the matter. [33577/06]
83 Mr. Timmins asked the Minister for Communications, Marine and Natural Resources when he expects the proposed east-west electricity interconnectors to become functional; and if he will make a statement on the matter. [33575/06]
I propose to take Questions Nos. 6, 34 and 83 together.
Security of energy supply is a key imperative for Ireland and the European Union. The relatively small size of the Irish electricity market underlines the need for greater interconnection as a means of enhancing security of supply, promoting competition and integrating the Irish electricity market into the wider European market. The recently published energy policy Green Paper, Towards a Sustainable Energy Future for Ireland, underlines the Government's commitment to deliver enhanced interconnection on the island of Ireland, as well as with Britain, as a priority. This is also the way forward envisaged at European level.
The Government has endorsed plans for the construction of a 500 MW electricity interconnector between Ireland and Wales. On foot of the Government decision, the Commission for Energy Regulation, CER, has been requested to proceed with a competition to select a developer on a hybrid-merchant basis to secure the construction of this interconnector by 2012 at the latest. The CER has also been requested to arrange for EirGrid and ESB to expedite the technical work of route selection and necessary grid reinforcement works. The Government decision provides that the interconnector, when completed, will be owned by EirGrid to ensure this strategic asset remains in public ownership.
To underpin the development process, I have proposed new arrangements in respect of the construction and operation of future interconnectors in the Energy (Miscellaneous Provisions) Bill 2006. The Bill provides that the CER may, with ministerial consent, secure the construction of an interconnector by one or more means, including by competitive tender. Such consent will be contingent on Government approval. Planning for decisions on further interconnection with Britain or potentially with the European mainland will begin in 2010.
What will be the ultimate cost of the interconnector? What is its intended route? What implications, if any, will selecting the developer on a hybrid basis have for the State? What impact will the interconnector have on the electricity market when it is opened in 2012? For example, how will it affect the marginal cost, the retail sales index and the role of the incumbent, the ESB? In other words, in what way will it promote competition? What impact will it have on renewables? What role will wind power play in the all-Ireland market from 2012 onwards?
I am reluctant to give a figure for the ultimate cost of the interconnector before the groundwork has been done on specific routes and so on. I have heard a ballpark figure of €500 million on a number of occasions but I would not go to the wall on that. The cost could be higher or considerably lower than that when the necessary works at each end are taken into account. Until I have more detail on the specifics of the route, seabed surveys and so on, it is pure guess work.
The fact that it will be a hybrid scheme will not have affect the State, as it leaves the question of financing open. One of the reasons for the interconnector is to enhance security of supply. It will provide 500 MW, which will be available "at the flick of a switch". It will increase the opportunity for other operators to buy electricity from companies other than those in the small pool in Ireland and sell it on in the domestic market. That should help competition and consumers regarding price.
With regard to renewables, the interconnector will assist our efforts to reach targets. The major problem with wind energy is intermittency, and electricity supply is, therefore, only available 30% of the time. The fact we have effective back-up that can almost be turned on at a switch will greatly help the position with regard to the extra renewables in the system.
How much control of the interconnectors, if any, will the State have? How many interconnectors will ultimately be provided? Are plans by one private enterprise group to build an interconnector at an advanced stage and within a similar completion timescale to that referred to by the Minister? With regard to the Minister's recently launched Green Paper, a reference was made which would appear to confuse whether the Minister's intention is to use publicly built or funded interconnectors or privately built or funded interconnectors. Some interconnectors will begin from the United Kingdom and some will begin here. Which project will begin first?
The interconnector will be completely State-owned through EirGrid, which will have complete control of it. There is one North-South interconnector, there will be a second North-South interconnector and there will be a third interconnector which will run east-west. These projects will be completed at the latest by 2012. I envisage a need for one more interconnector at that stage. As I stated in reply to earlier questions, we will begin planning for that further interconnector by 2010. It might be another east-west interconnector or, given the need for security of supply, it might link Ireland to the European mainland.
With regard to how it might be built, the Commission for Energy Regulation is responsible for designing the competition. A private contractor may end up designing and building it, but ownership will remain with the State. There are two basic options for financing the projects. The first is Exchequer funding, which has not been used to date. However, the discussion point put forward in the Green Paper is that this is critical infrastructure which perhaps, with some other infrastructure, should be paid for by the Exchequer because it is so critical. The other option would be to finance the project the way every other piece of energy infrastructure is financed, namely, the companies would get a rate of return each year——
It is the consumers who have to pay for it.
Yes, it is the consumers. There is an argument that taxpayers are consumers. I am open to discussion as to whether they should pay directly or through taxes.
Deputy Durkan referred to a private company. The Department received correspondence from that company but, so far as I know, it has not approached CER, which would be the first port of call. I understand the company has not contacted my counterpart in Wales as I met him four or five weeks ago and he was not aware of it. Perhaps it has made contacts more recently but, up to two or three weeks ago, it had not made contacts like that, although it claims to have finance in place.
In what year did the Department receive the proposal or begin consideration of the proposal for the new east-west interconnector? If we believe we will need a further interconnector with the UK or mainland Europe, why must we wait until 2010 before beginning planning for it? With regard to the Minister's Welsh counterpart, how do we know the system operator in the UK will allow us to have easy and full access to that system? If the UK system is under pressure at a particular time, do we know we will be given access to 500 MW from it? What reinforcements are necessary on the Welsh side to provide the proper infrastructure transmission network for this interconnector? Has the Minister obtained agreement from the British Government with regard to that investment or must we invest directly in some of the grid reinforcement that might have to occur in the UK?
I missed the first question.
When was the concept of a new east-west interconnector first raised in the Department? I am concerned this process has taken several years. Given the number of consultants and reports involved, the matter seems to have been ongoing for years despite the urgency of the situation when one considers our energy crunch in terms of electricity demand and capacity availability. This critical project should have been fast-tracked. I am concerned it has been sitting for three or four years with people gazing at it rather than doing anything about it.
This is one of the dilemmas we in Government must always face. If the Deputy ever happens to be on this side of the House, he will probably realise this.
Soon.
It is unlikely.
Sometimes we get accused of moving too fast on a project, of not thinking matters through and not foreseeing all of the difficulties. In other cases, as the Deputy rightly states, matters go on for a long time before we get from the concept to the project. I cannot give the Deputy a date but it was probably four years ago that a decision was made that there should be an interconnector. We tried to do this on a merchant basis but when all the procedures were finished, we discovered there was not the required interest in the market. The Government then decided it would consider alternative options. It was through CER that we commissioned a report from KPMG, which made a number of recommendations in July of this year, and it is on that basis that we are moving forward.
The decision in principle to have an interconnector has been in place for three or four years. In fact, there was a decision in principle that there would be two 500 MW lines. However, the recent KPMG report stated that two 500 MW lines would not be desirable at this stage because they might have the opposite effect in the market to the effect we want. So, in one sense, the fact that we had to go back to the drawing board and make a further study at least brought out that point, and we probably saved €200 million or €300 million in that regard.
With regard to the question of how we know we will be able to make the connection and install reinforcements, the decisions on these matters will be made in consultation with our Welsh and UK colleagues. The studies carried out reveal there are two possible routes. Deputy Broughan asked me a question on this matter earlier but I did not get to reply to it. There are two possible routes, north and south Wales, to two sites on this side of the Irish Sea. Reinforcement work would be needed on both sides of the Irish Sea. Such work would be in the interests of whatever power company we will be dealing with in the UK, although the position there is not the same as it is here. The UK company will examine that and make a decision on the basis of the possibility of extra business for it.
7 Mr. S. Ryan asked the Minister for Communications, Marine and Natural Resources when the three-person expert group on salmon will conclude and publish its report; if he will follow its advice and the decision of the National Salmon Commission; and if he will make a statement on the matter. [33418/06]
I received the report of the independent group to which the Deputy referred earlier this week and it is to be presented to Government for its consideration shortly. Until such time as the report is presented to Government, I am not in a position to comment on its recommendations or implementation. The question of publication of the report is a matter for the Government, the Minister, Deputy Noel Dempsey, and myself.
Given the steps involved in putting in place an appropriate regime to take effect from January 2007, including, for example, public consultation about any change to the wild salmon and sea trout tagging scheme regulations, decisions about the report must be taken quickly.
As the Deputy is aware, I have undertaken to follow the recommendations of the standing scientific committee of the National Salmon Commission to fully align the management of the fishery with its scientific advice for 2007. I established the independent group, to which the Deputy referred, earlier this year to examine the implications for the commercial sector in 2007 and beyond arising from this alignment. The group was expected to make recommendations on the options available to address any financial hardship arising for individuals involved in commercial salmon fishing.
I expect that the National Salmon Commission, having considered the advice of the standing scientific committee and the fishery managers, and in the context of the report of the independent group, to bring forward in accordance with its terms of reference advice on measures for management of the wild salmon fishery in 2007. The National Salmon Commission is aware of the importance of my receiving its advice at the earliest possible date. I understand it has a number of meetings scheduled over the coming weeks. I expect to receive its advice in sufficient time for the publication of the necessary draft regulations governing the 2007 wild salmon and sea trout tagging scheme. There will be a period for public consultation prior to enactment before the start of the 2007 season.
Will the Minister of State indicate if the report will be published openly or will it turn into a Deloitte & Touche affair, so to speak, whereby it will not be published for months and then eventually published in an underhand way?
The Minister of State mentioned addressing financial hardship for individuals in his reply and we know the advice of the National Salmon Commission given last year. Members of the public are generally aware of the impact of the continued multi-stock fishing on the nation's reputation. Has the Minister of State considered any detailed measures or costings in regard to addressing financial hardship for individuals? Would it be of the order of the previous scheme in regard to those fishing for white fish in the south east, or would it be much more narrowly based?
The EU habitats legislation was considered yesterday at the Joint Committee on Communications, Marine and Natural Resources. How will that legislation impact on the Minister of State's decision?
The report will be eventually published. The report and the recommendations I put forward to Government in respect of the three wise men, as they are known, were accepted, set up and approved by Government. At that time I stated that this report would be presented to the Government following consideration by me, the Minister, Deputy Noel Dempsey and our Department. We expect to do that as quickly as possible. Once the Government has made a decision on it, the report will be published.
With regard to the EU habitats directive of which we are in breach, are the Minister of State's hands not very much tied with regard to the new stipulation, bearing in mind that the scientific recommendations to date have been ignored by the Government? With regard to the recommendations by the scientists and the National Salmon Commission, is the Minister of State saying that he will act entirely on the scientific recommendations to Government?
The Government is committed to accepting the scientific advice for 2007. As agreed by Members on all sides of the House, we set up the strategy group to examine the implications of that. We intend to accept the scientific advice for 2007. We have received the report from the three people involved. It will go to Government shortly and we will make decisions accordingly.
The inland fisheries report was commissioned by Farrell Grant Sparks and following its completion, a year and a half elapsed before it was published. Will there be a similar delay in the publication of this report? In the case of the previous report, a situation similar to this one prevailed and the report was presented to Cabinet but it was not published for a further 18 months. Is the Minister of State saying that by mid-November, which is a critical time for the putting forward of recommendations for 2007, that this report will be discussed by the Cabinet and a decision made on it recommendations?
As an addendum to that question, the Minister of State seems to be dodging the question of the costings. Will he and the Minister make any recommendations to the Minister for Finance arising from the report, given that they have accepted the advice of the standing scientific committee?
The three wise men, as they are known, were asked to deal with the financial implications, and they have done that. Their recommendations or advice will go to Government and it will have to make a decision on any financial implications on foot of the report's recommendations.
I understand the Minister of State must await Cabinet approval before publishing the report and answering in respect of the financial implications involved or hardship schemes that may be put in place. I imagine the report cannot but be published in the next month, because as the Minister of State said, there is a timeline in terms of the upcoming season. This report will inevitably have to come out within a matter of weeks and the Government will have to make a decision on it within a matter of weeks. The Minister of State reiterated several times that the Government is standing by the advice of the standing scientific committee of the National Salmon Commission, which is welcome. That committee's advice could not be clearer, namely, that we need to put an end to the mixed stock fishery and catching of wild salmon. There will have to be an end to that mixed stock fishery. The only question for the Cabinet to decide is what will be the consequential management in terms of hardship, the defining of mixed stock and so on. Ultimately, the Government has agreed that the scientific advice is correct and we should move towards ending that mixed stock fishery.
The Government and the House have agreed that we would get to the scientific figures by 2007. We only received the report this week. We will give it serious consideration, present it to the Government for its consideration and, depending on its consideration, we will have to act quickly. I outlined the deadline dates within which we have to work. As soon as the Government makes it decision, we will operate within that deadline.
8 Mr. Morgan asked the Minister for Communications, Marine and Natural Resources if he is satisfied with the cost of broadband for Irish customers. [33441/06]
The provision of telecommunications services, including broadband, is a matter in the first instance for the private sector companies operating in a fully liberalised market, regulated by the Commission for Communications Regulation, ComReg, the independent regulator.
One of my key priorities is to increase competition through the provision of broadband infrastructure so that consumers and businesses can benefit from better quality, competitive prices and increased choice. Broadband prices have fallen consistently since 2003 and Ireland now ranks among the most price competitive in Europe with the third cheapest entry level ADSL for broadband in the EU-15 according to ComReg figures as at the end of June 2006. A combination of competition and regulation is driving prices down, for example, DSL prices fell by approximately 25% during 2005.
I note the Minister referred to private sector companies but, unfortunately, the State has not become involved in this sector because of the selling off of Eircom.
Is the Minister aware of the report from the International Telecommunications Union? It reinforced the point that Irish broadband subscribers fail to get value for money. According to its report, Irish customers pay €30 for a basic Eircom broadband package while customers in the Netherlands pay €8 less and have a connection that is 20 times faster. We are talking in terms our having the slowest broadband connection. Does the Minister agree that we still lag behind most European countries in the uptake of broadband? In that regard, is the Minister concerned about the slow roll-out of broadband, particularly in those regions where no major employer will invest unless basic infrastructure, such as broadband, is available?
I have made no secret of my impatience and frustration at the slow commencement of a broadband roll-out throughout the country. We were left behind in 2002. There is no doubt about that and the Government recognised that fact at that stage. It introduced the MANS programme, the schools broadband programme and the group broadband scheme to try to roll out and provide broadband in regional and provincial areas. On the issue of the commencement of the roll-out of broadband, I have frequently said I am disappointed. However, I am delighted to report that we have turned the corner on this issue. I set a target just over two years ago when we had just over 56,000——
We are last in the race. We may be turning corners but we are still last.
We had 56,000 subscribers in Ireland at that stage and I set a target of 400,000 by the end of this year. We had 410,000 subscribers as at September of this year and 17,000 new subscribers are coming on the system per month. We have the fastest growing broadband increase of anywhere in Europe. It looks as if we have turned the corner.
We have turned the corner all right.
Into a cul-de-sac.
That is very welcome but as the Deputy pointed out, no matter how fast it is rolled out, there are still areas of the country that will not get broadband access unless the State intervenes. The estimate varies but we are talking about approximately 10% to 15% of the country without coverage.
That is a lot.
We are discussing a scheme that will enable us to resolve that difficulty. I understand that Eircom is making an announcement today which will be helpful in facilitating a further roll-out of broadband with regard to enabling exchanges and so on. After a very slow start, we are now accelerating. Over the coming months we can reach even higher targets than those we have set. I hope we will be able to devise a scheme that will provide for the area to which the Deputy referred, namely, the last 10% or 15% of the country, to try to ensure there is coverage.
What technology does the Minister propose to utilise to achieve coverage for the 10% or 15% to which he referred? Will it be wireless, satellite or a combination of the two? Will it include places like the Black Valley in County Kerry, which the Minister has been shyly skirting for the past few years, and areas in the midlands, with which the Minister would be much more familiar, that do not even have adequate traditional telephone services?
The Minister mentioned that we have turned the corner but we have been turning the corner for the past two years.
We are dizzy from turning corners.
I would have thought we would be on a straight road by now. We have serious problems in this area and industry is suffering as a result of the slow delivery and high cost of broadband. It is much more costly than has been suggested by the regulator and serious questions must be answered in that regard. I ask the Minister to take a much more serious interest in what is going on, with a view to driving it ahead, regardless of what he is being told by way of statistics.
I cannot help it if the statistics do not suit the Deputy. I have taken this issue very seriously. The statistics show that we are below the average cost in Europe for broadband. If the statistics do not suit the Deputy, I cannot help that. We are very well placed with regard to price because of the policies pursued with MANS, the group and school broadband schemes and the drive that I personally put into this to try to roll out broadband and encourage companies to roll it out to a significant extent.
The Deputy asked what technology will be used to provide broadband services to the last 10% or 15% of the country, that is, at the uneconomic exchanges. The solution will have to be technology neutral. The industry will have to participate in the process of arriving at a solution and the State will have to provide assistance. There are areas where there is no exchange close enough to provide broadband services and there are other areas where, for a variety of reasons, one may have to use satellite or wireless technologies. The solution will be a combination of all the technologies available.
I warmly welcome today's announcement by Eircom that it is enabling 100 more exchanges. However, that still leaves over 600 exchanges in rural Ireland with no chance of getting broadband. The Minister has referred to the wireless option, which we all know is very expensive.
Is the Department talking directly to the new owners of Eircom, the Babcock and Brown team of Mr. Rex Comb and Mr. Pierre Dannon, about how we might enable the whole country? Mr. Rex Comb said in an interview on 6 October in The Irish Times that he could not see how the company could commercially enable those outstanding rural and other exchanges that are in difficulty.
I commend the Minister on the fact that 9.6% of lines are now broadband enabled and that we now have 410,000 subscribers. However, Denmark has 29.3% of lines enabled, the Netherlands has 28.8%, Iceland has 27.3%, South Korea has 26.4% and so on. In a recent report on the OECD nations, we were passed out by the Czechs. It is only countries like Slovakia, Mexico and so on that are behind Ireland.
I ask the Deputy to conclude.
Deputy Morgan asked a question about costs and, according to the figures I have in front of me, among EU and European countries only Luxembourg, Denmark and Iceland are more expensive for broadband than Ireland. Broadband is very expensive, less than 10% of the population has access to it and it is still a bit of a disaster ——
I call on Deputy Eamon Ryan to put his question to the Minister.
This is something that will probably haunt the Minister through the general election campaign when people reflect on it.
Does the Minister agree that while the numbers are growing significantly, Eircom still holds a massive advantage here in that it holds the last mile connection? Most broadband is going through DSL and copper wire connections and the main companies have said to members of the Joint Committee on Communications, Marine and Natural Resources that the alternative methods, wireless and so forth, are not proving commercially attractive. In those circumstances and in the absence of proper local loop unbundling, we do not have a competitive market. We still have a very significant monopoly. If one considers not only providing DSL broadband but also the next level in terms of voice over Internet broadband and telecommunications, merged services and a range of other new technologies that other countries are starting to roll out, we will still be playing catch-up because of that monopoly.
The Minister said that the solution for the last 10% to 15% of the country must be technology neutral and that the Government and the industry must be involved in finding that solution. That can only mean that he is considering a State subsidy scheme for suppliers to provide broadband for isolated, rural, one-off houses or communities that are not currently acceptable to a network. Is that what the Minister is discussing with the industry?
Deputy Broughan asked if I was talking directly to Eircom, Babcock & Brown or the industry. I am talking directly to everybody I can in the industry. I addressed the TIF conference today and took the opportunity to speak to a number of other providers. Every opportunity I get I speak to people on the issue.
I have had a number of meetings with Mr. Rex Comb and Mr. Pierre Danone, including a courtesy meeting and a more business-oriented meeting. I have not been talking to them directly with regard to the scheme. The Department is currently finalising a proposal and will probably consult with TIF as a representative body. It will then go to market in that regard.
Is the Minister indicating the Government will enable those exchanges?
No, we will look for proposals to ensure that the last 10% to 15% of the country will be able to avail of broadband and there will be broadband coverage. The Department will see what is the industry's response.
In reply to Deputy Eamon Ryan, despite my best efforts over the past two or three years in this area, we are not going to get the private commercial sector to fork out money to provide broadband on a nationwide basis out of any sense of national pride or interest.
The companies all agree with the concept that it is in the national interest to have as much broadband coverage as possible, but they have indicated they will not pay for it. If it is economical they will provide it, but they indicate that if the Government thinks it is in the national interest that broadband coverage is everywhere, the Government should contribute. They will be looking for some support, State subsidy or backup.
In response to Deputy Eamon Ryan's point, we are moving on the issue of voice-over IP etc. That brings me back to the earlier point I made about the necessity to have as much fibre-optic cable as we can. We must think now about next generation networks, which will be based on fibre-optics rather than copper. This is particularly true if we want to get the reach and services we need.
I have a point on figures and comparing like to like. The worst possible set of statistics to use in comparing Ireland to other countries in Europe on broadband is household figures. Population would be better from an Irish point of view.
I was speaking in per capita terms.
We have a different household distribution and we have more people in households than anywhere else in Europe.
My figure is based per capita.
That concludes Question Time.
We live in overcrowded conditions.
Written answers follow Adjournment Debate.
