Léim ar aghaidh chuig an bpríomhábhar

Dáil Éireann díospóireacht -
Tuesday, 11 Jun 2013

Vol. 806 No. 1

Priority Questions

Energy Regulation

Michael Moynihan


52. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources the measures he will take to enhance competition in the energy market; the actions he will take to protect Ireland from external energy price shocks; if he will examine the remit of the Commission for Energy Regulation; and if he will make a statement on the matter. [27899/13]

The Government remains firmly committed to increasing competition as the best means of exerting downward pressure on prices in the electricity and gas markets in Ireland. Currently, there is competition in both the electricity and gas markets, with many players competing in both the wholesale and retail segments of the electricity market and in the retail segment of the gas market. Business and domestic consumers can choose from a range of suppliers in both electricity and gas, thereby availing of the benefits of competition.

Electricity and gas costs in Ireland are influenced by various drivers, with global gas and oil prices being the most significant factors. Among other factors over which we have little or no control are exchange rate movements, the cost of capital, EU legislative obligations and unfavourable international events, as well as our small size, geographical location, low population density and population dispersal. Given the reality of how much these factors affect prices, it is clear there is little scope for protecting Ireland from external energy price shocks.

The main opportunities to mitigate the impact of external price increases are in focusing on greater energy efficiency and diversity of fuels. Energy efficiency represents a significant opportunity for both businesses and households to reduce their energy costs and mitigates the impact of external price rises. Achieving the Government’s target of generating 40% of our electricity from renewable sources by 2020 would provide greater diversity of fuel supply and would also help to offset the impact of volatile fossil fuel prices.

The remit of the Commission for Energy Regulation, CER, is set out in the Electricity Regulation Act 1999, as amended. More generally, with the deregulation of electricity and most gas retail prices, the primary focus of the regulator, as far as prices are concerned, is its joint oversight with the Northern Ireland regulator of the all-island single electricity market, its scrutiny of electricity and gas network costs, which feed into retail prices, and its general consumer advice and protection role. The statutory functions of the regulator require it to consider and decide on very complex issues.

Additional information not given on the floor of the House

The CER's ability to strike an appropriate balance between competing demands is noteworthy. The CER is required, first, to promote efficient, orderly, fair and competitive markets, second, to facilitate investment, and third, to protect consumers’ interests. Striking such a balance requires considerable knowledge, skills and expertise. While the roles of regulators are continually monitored, I have no specific plans to review the remit of the CER in the near future.

I thank the Minister for his reply. We have seen reports in recent weeks about the increase in the number of households whose gas or electricity supplies were cut off during 2012, and that figure is still increasing. Is the Minister satisfied with the role the regulator is performing and the duties it is carrying out?

Commodity oil and gas prices reduced by about 11% in the wholesale market in May, but that reduction was not passed on immediately. It is the old argument. If the price of oil goes up, the price increase is immediately passed on at the pumps or in the cost of home heating oil, but if it goes down, they tell us they have oil in storage and that it will take them a number of months to get to the cheaper oil. Is the Minister satisfied that the regulator is doing everything in its power to ensure the price of energy for homes or businesses is at the lowest possible level?

Unfortunately, since about mid-2009, the price of fossil fuels has continued to rise in the international marketplace. We are 100% dependent on oil imports and 95% dependent on gas imports. In that sense, we are price takers. To that extent, we import fossil fuels and are, therefore, vulnerable. The Deputy will acknowledge that for the first time in a very long time the most recent Bord Gáis Energy index shows that there has been a decrease this month, which is certainly welcome. However, I am advised that gas prices reached their highest ever level in March. That is the context.

I share the Deputy's concern about disconnections and use every opportunity to bring to the attention of consumers that under the protocol in place with the supply companies, where a consumer enters into a prepayment plan or installs a pay-as-you-go meter, the household cannot not be cut off. There has been a considerable rise in the number of installed meters, but it could be better. I appeal to people to take steps to install meters to avoid being disconnected.

Are the Minister and the Department happy with the role of the Commission for Energy Regulation? Has the Department explored the possibility of extending the commission's remit in the light of the number of disconnections and ensuring the best possible price for householders and businesspeople? Is the Minister satisfied with the commission's remit and has he looked at ways of extending it?

The Commission for Energy Regulation does a good and conscientious job. I met it two weeks ago to discuss the issue raised by the Deputy. The commission and I are examining whether there are measures not known heretofore that can be brought to bear. As the Deputy is aware, the regulator is required to promote efficient, orderly, fair and competitive markets; to facilitate investment; and to protect consumers' interests. It is that third requirement on which the Deputy focuses. Striking a balance in that regard requires considerable knowledge, skill and expertise. That requirement of the regulator is continually monitored. I have no short-term plans in respect of reviewing the entire role of the Commission for Energy Regulation.

Renewable Energy Generation

Michael Colreavy


53. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources his Department's renewable energy target; if this is achievable; the strategy in place to reach this target; and if he will make a statement on the matter. [26995/13]

The 2009 renewable energy directive set Ireland a binding target where at least 16% of our energy requirements should come from renewable sources by 2020. The directive also requires all member states to achieve a minimum target of 10% renewable energy in the transport sector by 2020. In order to meet our overall 16% requirement, we aim to achieve 40% in the renewable electricity sector, 12% renewables in the heating sector and the required 10% in transport. Under the directive, Ireland was required to set out in a national renewable energy action plan, NREAP, the trajectory towards meeting its legally binding targets. The NREAP and the first progress report on the NREAP, which are available on my Department’s website, show the sectoral and technology breakdown that we anticipate in the achievement of our target. By the end of 2011, we had reached 6.4% of overall energy consumption from renewable sources and the trajectory set out in the NREAP assumes that we will achieve the 16% target incrementally at approximately 1% per annum.

My Department’s Strategy for Renewable Energy 2012 to 2020 sets out the key strategic goals for the various renewable energy sectors. Although these targets are challenging, I am confident that we can meet them and there are a number of policy measures in place which will help us achieve these goals. The renewable energy feed-in tariff, REFIT, schemes will see increasing amounts of renewable electricity connected to the grid and, through REFIT3 support for biomass combined heat and power technologies, will also help towards our renewable heat target. Measures such as the biofuel obligation scheme to increase the use of biofuels and the electric vehicle grant scheme to incentivise the purchase of new electric vehicles will assist in meeting the target for renewable transport.

I thank the Minister for the reply. Currently, the country is 89% dependent on imported fossil fuel which is costing the nation something in the order of €6 billion annually. The Minister has referred previously to a strategy and an action plan. Perhaps my understanding of what is a strategy and an action plan differs to that of the Minister. What I see is a wish list with some target dates and statements of intentions but I do not see the concrete action plans to hit the targets to which the Minister refers. I do not see that in the action plan or in the strategy. That strategy needs to be developed into something which the Irish public can recognise as a clear direction of where the country will go in this sector between now and 2020 in order to hit the targets. The strategy also needs to make very clear the areas where increased public-private participation will be encouraged and it needs to make abundantly clear how it is planned to handle the changes and the impacts on the places where people live. These developments will have an impact on places where people live. More specific details are required.

I will call the Deputy for a supplementary question.

I think the Deputy is being unfair and contradictory. He cannot say that he sees no evidence of the plan while at the same time his party frequently complains to me about new planning applications for wind farms in different parts of the country. I do not think the Deputy can have it both ways. The 40% target for renewables is important in that it increases diversity and it uses an available indigenous resource. As the Deputy rightly points out it reduces dependence on imported fuels and lowers that import bill of €6 billion. All the advice available to me forecasts that the 40% target will be met.

The Deputy can pursue my colleague, the Minister for Transport, Tourism and Sport, on the transport aspect of the matter. While it is difficult, the plan we have set ourselves relates in a European context to the situation post-2020 and what will happen after the 2020 targets. We will continue to make the 2020 targets which have been agreed our targets.

I anticipate that given the absence of a coherent strategy for involving host communities in the national effort, the Minister will continue to receive questions on developments from my party. Any strategy must clearly outline how host communities will be impacted upon and how their interests will be protected as part of the process. Until that strategy is in place, the Minister will continue to receive representations.

In the context of local area renewable energy projects, a number of people have contacted me on the contribution anaerobic digestion might make to the national grid. They have been told that it costs €500,000 to connect to the national grid. In essense, that is to say, "Go away. We do not want you." I ask the Minister to use his good offices to ensure there will be a realistic cost associated with connecting to the national grid. Small area power units have a fair contribution to make to the overall strategy which needs to be in place.

I agree with the Deputy and I am sure that he will agree with me that in the rush towards renewables one must have regard to economics. The refit subsidies are not without cost. In particular, refit 3 which relates to combined heat and power systems, biomass and so on is expensive, about which there is no doubt. I hope to publish a strategy on bioenergy by the end of the year, if not sooner, depending on other considerations in play. I would welcome the input of the Deputy and other Members in that regard.

Energy Schemes

Catherine Murphy


54. Deputy Catherine Murphy asked the Minister for Communications, Energy and Natural Resources if he will provide an update on the expected delivery of a functioning pay-as-you-save scheme to allow for home energy retrofit; when the first applications may be made under this scheme; the reason for the delays in establishing this scheme; and if he will make a statement on the matter. [27093/13]

The national energy efficiency action plan and the programme for Government include a commitment to roll out a better energy financing - formerly known as pay-as-you-save - energy retrofit scheme for domestic buildings. The better energy financing, BEF, model proposes that the current suite of Exchequer funded grants for energy efficiency measures will be replaced by a new financing scheme open to households and commercial operators. I stress, however, that it is my intention, in the context of the introduction of a BEF scheme, that the existing grants scheme aimed at those on low incomes will remain in existence.

The key benefit to homeowners of the BEF mechanism is that the scheme will allow them to secure up-front financing for energy efficiency upgrades to their homes and, in the process, remove one of the key barriers to energy efficiency. The principle underpinning the model is that up-front funding will be repaid via savings on customers' energy bills arising from energy efficiency measures. While that is the principle, it will be a challenge to ensure sufficient savings are realised within a short period to cover the costs involved. This is a particular focus of the project board referred to. The consumer will also benefit through the creation of a robust quality assurance process which will protect consumers and ensure high quality workmanship.

My Department, with the assistance of the Sustainable Energy Authority of Ireland, has put in place a project team to design the new retrofit financing scheme under the direction of a project board representing key State and industry stakeholders. The board has available to it expert advice in a range of relevant technical, legislative and financial areas to ensure the delivery of a BEF model designed to suit the Irish context. The board has been engaging widely with stakeholders as part of the development of the scheme and meets on a monthly basis.

It is planned that the design of the scheme will be fully developed over the coming months and that a public consultation process will be undertaken in quarter three of this year. My intention is that a memorandum for Government on the detailed design of the BEF programme will be brought forward in September 2013. Assuming I get approval, it will take a number of months to introduce the necessary technical, administrative and financial pillars to underpin the scheme. While primary legislation will also be required, a scheme will be in place in 2014, in accordance with the Government’s commitment set out in the programme for Government.

Additional information not given on the floor of the House

In the interim, the Government has committed over €44.5 million in Exchequer capital funding for the better energy programme in 2013, which will mainly involve grant based expenditure across better energy homes, better energy warmer homes and better energy communities. I have also recently obtained Government approval to continue the better energy homes scheme into 2014 until such time as the better energy financing programme is ready to commence.

I thank the Minister. We all know the price of heating people's homes is increasing. The very long winter we have had has put additional pressure on people and this links into the question asked earlier about the number of disconnections. However, that may not be the initial target group for this scheme. There is much to be done before the scheme is developed and in place. Does the Minister anticipate it will be in place at the beginning of 2014 so that people can, for example, plan to do the work and have realistic expectations that it can be carried out in the early part of next year?

The Minister talked about the consultation process. What is the timeline for it being put out to public consultation? How long will it take and how will it be evaluated?

It will be out in quarter three for a reasonable period. I do not know the figure the Deputy would put on it and I am quite agreeable to agreeing something with her on it. The scheme was promised for 2014 and it will make 2014. I must have regard to the existing scheme. There is, for example, a six-month timeline and I would have to cut off that scheme now if I was to commit to 1 January. That is the time it takes to work through the process. I do not want to do that and I would like to continue the scheme for a number of reasons because there is a cadre of installers and retrofit contractors in place, with some 4,500 people employed, which I want to maintain.

It is uncannily like what happened in Britain. After the first flush of applications, presumably from households minded to be energy efficient, the numbers have fallen off dramatically. Deputy Catherine Murphy is hinting that, if only the scheme was up and running on 1 January, there would be a flood of applicants. I hope she is right because when looking at the energy picture, one of the few tangible things we can do, given that we import our fossil fuels, as Deputy Colreavy said, is to drive the energy efficiency programme, get consumption down and get people to change their patterns of behaviour and save money in terms of import costs associated with fossil fuels. I hope the Deputy is correct but the experience here, in Britain and elsewhere in Europe is that, principally because of the recession, in the case of something that requires householders to put their hands in their pockets to put up a share of the payment for deep retrofit or less than that, they are thinking twice about it just as they are thinking twice about whether to change the car or invest in a new washing machine.

There is much the Minister and I would agree on with regard to the switchover to energy efficiency and refurbishing people's homes so they can save energy. However, people are not foolish. They will take up the option if they see they can get a reasonable return on it. The last time I asked the Minister this question, he spoke about evangelising and recruiting people to this scheme. However, there must be a scheme to which people can be recruited. That is why I believe there should be some enthusiasm about setting out as quickly as possible the shape the scheme will take, so that people can put it into their plans for saving money over the longer term.

I have been trying to do the St. John the Baptist role that Deputy Catherine Murphy sees for me. We have a scheme. It is a grant-based incentive scheme and we are trying to sell it. Sometimes Deputy Murphy deliberately portrays a pessimistic face to the world about the dreadful things that are wrong, but if she wishes to join forces in going out to sell this to the householders of Leixlip, I assure her the grants will be approved in a very short time so they can get on with it.

The new scheme is a quite complex construction. I hope it will be attractive to the householder because of the principles behind it, but it requires people to be persuaded that they can make significant savings on their energy bills if they engage in retrofitting a housing stock which, quite honestly, leaves a great deal to be desired in this regard.

Broadcasting Sector Regulation

Michael Moynihan


55. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources the actions he has planned to ensure that RTÉ has a sustainable future; the reforms he intends to bring to the current licence fee system; and if he will make a statement on the matter. [27900/13]

RTE is an independent national public service broadcaster whose remit and obligations are set out in section 114 of the Broadcasting Act 2009. RTE has a direct obligation under section 105 of the Broadcasting Act 2009 to ensure that its revenue is, at the earliest possible date, at least sufficient to meet all sums properly chargeable to its current account and to make suitable provisions with respect to capital expenditure. I am satisfied that RTE management is fully cognisant of this obligation and is taking all the necessary steps to ensure that the company continues to be in compliance with the terms of the provision.

I have had cause to meet with senior management in RTE on several occasions during the last 18 months and I have made it clear that a continuing deficit position in the corporation is unacceptable. RTE is in agreement with this and has assured me that as a result of the restructuring programmes the organisation has undertaken and continues to undertake, a break-even position is targeted for the end of this year.

One of RTE's key challenges is managing its commercial revenue, which is declining as a result of increased levels of competition in a challenging and fragmented economic environment. RTE's commercial income totalled €156.3 million in 2012, compared to €167.3 million in 2011. This represents a decrease of 7%. The organisation's commercial income has fallen by 35% since 2008. In the first quarter of 2013, I understand that RTE's advertising revenues were weaker than expected for this year.

With regard to reform of the current licence fee system, the Deputy will be aware that the programme for Government commits to examining the role and collection of the TV licence fee in light of existing and projected technologies and to transforming the TV licence into a household-based public broadcasting charge to be applied to all eligible households and applicable businesses, regardless of the device used to access content or services. I recently received the completed report of the value-for-money review group on the proposal to introduce such a charge. The independently chaired review group, which was established under the auspices of my Department, examined a range of issues relating to the proposal, including the efficiency and effectiveness of the current licensing system. I am currently considering the contents of that report. I expect to be in a position, subject to Government approval, to initiate work in the autumn on the legislative and other work necessary to implement the household-based public broadcasting charge.

On the last point, the Minister stated that he had received the report and was considering it, and indicated that the work would commence in the autumn. Is he talking about the early autumn or about having something in place by the end of the year?

With regard to RTE's revenue, we recently received and examined the value-for-money report. The State broadcaster has an important role, and it is important that the public have faith and confidence in it. The Minister stated that commercial revenue is weak again this year because of the operating environment. I presume RTE has lowered the cost of advertising in accordance with demand. Independent broadcasters who talk to us at committee meetings or privately refer to the cost of producing current affairs programmes, documentaries and other programmes. The cost of production is cut to a minimum, whereas RTE seems to have many backup staff and considerable technical advice for all programmes.

Media outside RTE have always commented on the cost of stars to the State broadcaster. This issue has been debated in the broadcasting and print media for a long time. A fundamental issue arises in regard to RTE, as its production costs seem to be at variance with those in the private sector and with what is considered best value throughout the country.

The record will show that RTE has led the way among the State corporations in grappling with the implications of the economic downturn and attempting to provide feasible solutions. One should bear in mind the reduction in the number of staff, for example. Three hundred and fifty staff have left voluntarily, including 270 in 2012 alone. In the past four years, the headcount has been reduced by 493. This big drop, from 2,351 to 1,858, represents a reduction of 21%. Unfortunately, the fact of the matter relates to the collapse in commercial revenue. The collapse in advertising has been more dramatic than anybody had forecast. This is not significantly due to the recession but to advertisers' migrating to other platforms and companies, where they can tailor their advertising to particular segments of the market that they want to target. The fall in the licence fee is not very significant or serious but the fall in commercial revenue has been quite dramatic. The cost of operating activities has decreased by 24%, or €104 million, from €439 million in 2008 to €335 million at the end of 2012.

On the Deputy's central point, which concerns efficiency and value for money, there have been very serious cutbacks. We must, in the interest of fairness, have regard to quality also. The national broadcaster will not get away with quality lapses, and if they arise they will be quickly highlighted and scrutinised. We have to take that into account as well.

We expect the highest standards from the national broadcaster and have seen the disastrous consequences when it has not adhered to best practice. That is a debate which has taken place in committee rooms and elsewhere. As the Minister said about the licence fee, society is changing and RTE, for all its technical advice and backup systems which were seen as the leaders in technology, seems to be somewhat behind the curve. Advertisers have moved away from it. Huge changes will take place in broadcasting in the next five to ten years. We often hear commentators in RTE talking about fat in the system in other businesses or State bodies. Are the Minister and the Department completely satisfied that every efficiency has been achieved in RTE, in terms of backroom staff, producers, researchers and so forth working on particular programmes? After his discussions with RTE and given the changing face of broadcasting, is the Minister satisfied that it is up to speed in what will be a completely changed system in the next five to ten years?

It must be very disappointing for senior management in RTE that, having engaged in the serious restructuring it has carried out in the last couple of years and having had pay reductions and redundancies before similar companies, first quarter revenue income from commercial advertising has fallen. In the discussions I have had with the director general and the chairman of the board I have emphasised that the break-even objective for the end of this year has to be met, and the board accepts this. Unfortunately, this may mean management will look for more efficiencies. It is important to acknowledge the progress that has been made, at a cost of some hardship for persons who have left employment prematurely and those who have had changes in income and so on. However, the board and the director general are aware that they have to effect efficiencies wherever they can. It is also important to point out that they have used online services in coping with the changes in technology to which the Deputy pointed and have been doing so from the beginning. They are focused on the digital future of the company. My answer to the Deputy's question on whether there is an awareness and appreciation of the fact that they have to continue to make savings and achieve efficiencies where they can is yes. However, we come back to the net point that it is the diminishing commercial revenue that is causing the problem for the company.

Energy Regulation

Richard Boyd Barrett


56. Deputy Richard Boyd Barrett asked the Minister for Communications, Energy and Natural Resources if he will outline all the processes and conditions surrounding the establishment and management of windfarms, both on and offshore, including required permissions, environmental stipulations, licensing, taxes, royalties and other benefits to the State; and if he will make a statement on the matter. [27898/13]

The development and operation of wind farms in Ireland require planning permission from the relevant planning authority and, in the case of offshore wind farms, a foreshore lease from the Department of the Environment, Community and Local Government.

They also require an authorisation to construct or reconstruct a generating station and a licence to generate from the Commission for Energy Regulation, CER. In addition, a grid connection from EirGrid or ESB Networks is required to become operational.

Planning and foreshore leasing are, in the first instance, matters between the developer of the wind farm and the planning authority subject to the Planning and Foreshore Acts, including the requirements for public consultation as specified in the legislation. In addition, best practice wind energy guidelines were published in 2006. The Department of the Environment, Community and Local Government, in conjunction with my Department and other stakeholders, is undertaking a targeted review of certain aspects of the guidelines. This review will examine the manner in which they address key issues of community concern to ensure wind energy projects do not have negative impacts on local communities.

In addition, the 2012 Government policy statement on the strategic importance of transmission and other energy infrastructure, published by my Department, emphasises the importance of public and local community acceptance, adherence to national and international standards in designing and constructing energy networks and infrastructure, early consultation and engagement with local communities, and building community gain considerations into energy infrastructure planning and budgeting. Applications for authorisations to construct or reconstruct a generating station and for licences to generate are assessed by the CER ahead of granting or refusing the application. The conditions imposed in the authorisation and the licence must be met by the generator and compliance is monitored by the CER on an ongoing basis. In regard to grid connections, EirGrid and ESB Networks assess applications and make connection offers in line with the appropriate development and roll-out of grid infrastructure.

Additional information not given on the floor of the House

In terms of benefits to the State, wind energy development has been the largest driver of growth in renewable energy. In fact, it will make the greatest contribution by far towards the achievement of the target for 2020 to meet 40% of electricity demand from renewable sources. Failure to achieve our overall renewable energy targets will result in compliance costs and emissions permit purchases. The Sustainable Energy Authority of Ireland has estimated that these could amount to some €100 million to €150 million per annum for each percentage point shortfall in renewable energy and a further €250 million in emissions permit purchases. With regard to taxation, the State benefits from the tax take on taxable profits generated by energy companies. Rates are also payable to local authorities and offshore wind energy project developers pay royalties of 2.5% of total revenue to the Department of the Environment, Community and Local Government under the terms of foreshore leases.

Regarding the potential export opportunity, the memorandum of understanding on energy co-operation that the United Kingdom Secretary of State for Energy and Climate Change, Mr. Edward Davey, and I signed on 24 January will result in the completion of a consideration of how Irish renewable energy resources, onshore and offshore, might be developed to the mutual benefit of the State and the United Kingdom. This will determine whether it is beneficial for both countries to enter into an intergovernmental agreement under the renewable energy directive to provide for renewable energy trading. The amount of energy to be procured by the United Kingdom and the mechanisms for sharing the resultant economic benefits, including an appropriate return to the Exchequer, are matters to be addressed over the course of this year and ahead of signing a potential intergovernmental agreement which would have to ensure no financial cost or risk to the State or Irish consumer.

I am strongly in favour of this country developing our renewable energy resources. It is vital that we meet, if not exceed, the target of 40% renewables production by 2020 in the context of the climate change crisis and the economic benefits arising from the development of indigenous energy sources. My concern, however, is whether the citizens of the State will reap the benefits of implementing that policy. We have heard about the proposed Dublin Array project which will see the construction of the second largest wind farm in the world 10 km off the Dublin coast and the controversial plans to install more than 1,000 wind turbines in the midlands to generate electricity not for this country but for the British grid. These proposals raise serious questions as to whether the regime we have in place will ensure the people will benefit from the development of our abundant wind resources. What tax regime will apply to these developments? Why is the ESB, for instance, not involved in the development of resources such as the Kish Bank? Have we examined international best practice in terms of proximity to the coastline where, for example, buffer zones of 22 km are observed by a number of the leading wind energy producers in Europe? What is the position in regard to royalty regimes? I am concerned that public consultation is not up to scratch. Some of us are of the view that there has been a giveaway of oil and gas, with no proper regime in place for the development of these resources. Will the Minister assure us that our wind resources will not be given away but will instead be developed to the benefit of the citizens of the State?

I remind Members that one minute is allowed for supplementary questions and replies.

I do not know where to start in answering the Deputy. I take him at face value when he says he is in favour of building up renewables capacity in the economy. In so far as that capacity is meeting domestic need, I assume it meets his approval, provided it complies with good building standards.

With regard to developing an export trade in this area, I appeal to the Deputy to stop using emotive language about our generating electricity for the Brits. If I were the Minister for Agriculture, Food and the Marine and came into the House to say I had got a new contract in Britain for beef, Deputy Boyd Barrett would not be railing against me for selling cattle to the Brits. I am completely confused as to why he rails against me for seeking to create the environment for, and to facilitate the emergence of, trade in an indigenous resource. In Ireland we can generate more energy than we need and will do so provided we can find a market for it. One cannot, broadly speaking, store electricity, so if one is going to generate more than one needs one has to be able to sell it to someone who does need it. Happily in these circumstances, the people of Britain do require renewable energy and we are in a position to sell it to them. As a principle I cannot for the life of me see why Deputy Boyd Barrett would want to interfere with that. We can talk about planning and all the rest, but in terms of the concept I would go home happy this evening if I felt I had persuaded Deputy Boyd Barrett that, for a tiny island economy, selling things to outsiders is a good idea.

The question is whether we will benefit from this. Of course we should sell energy if we have enough of our own, but in a situation in which we have very difficult targets to meet and must massively increase our domestic production of renewable energy, saying we should sell it to England before we have enough of it ourselves is a somewhat spurious argument. These issues need to be teased out.

In the midlands - and I am only asking the questions - serious issues arise with regard to proximity to people's homes. Are we looking at best practice for proximity to homes and to the coast in the case of the Dublin Array project? I have an open mind on these issues but I want to see best practice and proper public consultation and I want the Minister to say why there is a 22 km buffer zone for offshore wind energy in Germany, the Netherlands and other European states, while the UK and Denmark are also now considering bringing in a 22 km buffer. Crucially, I want to know what revenue we will get in the form of tax and royalties from the production of this energy. Will there be guaranteed security of supply to the domestic market? Will the energy produced go against our targets for the development of renewable energy or will they boost another country's targets if the energy producers decide to sell or mainly generate for other markets? These are serious questions that need to be answered. Before we can develop these resources, we need to be sure we will benefit from them and that they are being developed in an environmentally safe way.

I accept that there are serious questions and I can assure the Deputy that there is no question of our developing an export trade in this sector unless we are confident that our own targets will be met. I think I am correct in saying that technically the directive requires that we meet our domestic targets before we can engage in such export trade. This can be checked. The Deputy knows as well that, with regard to the 40% target, which he described as ambitious - which it is - there is a limit to how much wind the grid can take. We are a leader in that regard in Europe and the professional and technical competence of EirGrid is acknowledged. We have not yet agreed any royalties, taxes or anything else with the British Government.

I signed a memorandum of understanding with my UK counterpart, Mr. Ed Davey, Secretary of State for Energy and Climate Change, in Dublin at the beginning of the year. Two teams are working on it to flush it out into a full-scale intergovernmental agreement. The Deputy is correct that if only the economics of it stack up, it will become a reality. Of course, there has to be benefit to Ireland. If I were selling cattle to Britain, I would not propose to give them away.

That was not my point.

I know a man who would give them away.

Absolutely, I know a bit about that.

The Minister is giving away our oil and gas, however.

No, I am not giving away our oil and gas. For the hundredth time since I got this job, can I point out to the Deputy that in the past four decades neither I nor any of my predecessors ever found any bloody oil to give away?

Thank you, Minister.

How can I give it away if I do not have it? My car is leaking at the moment and I keep a pint of oil in the boot in case the red light comes on. That is all the oil that I am wasting or giving away.

I have to find the oil first. We are working on that too. I know that out in Dalkey I will have the Deputy’s full support should a big gusher come at him down the main street.