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Dáil Éireann díospóireacht -
Tuesday, 28 Apr 2015

Vol. 876 No. 1

Priority Questions

Electricity Transmission Network

Michael Moynihan

Ceist:

1. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources his views on the latest EirGrid proposals on the North-South interconnector, Grid West and Grid South; if he supports putting cables underground in all projects; and if he will make a statement on the matter. [16436/15]

On 27 March EirGrid published, for public comment, a discussion paper on Ireland's grid development strategy, entitled "Your Grid, Your Views, Your Tomorrow". The paper, which reviews, inter alia, the grid link, Grid West, and North-South transmission line projects, confirms that Ireland’s energy transmission needs may be met with reduced new infrastructure build because of new technological developments and updated projections of future electricity demand.

The discussion paper, which was subject to an independent peer review, confirms the need to reinforce the transmission system in the south east. It suggests an additional option to the original grid link options. The original options would require either the construction of significant amounts of new overhead lines or the laying of significant amounts of underground cable. The additional option contained in the recently published discussion document would involve an underwater cable in the Shannon Estuary and upgrading existing transmission lines rather than building new lines.

The discussion paper also puts forward options for Grid West. The options include underground cabling, a 400 kV overhead line option and a 220 kV overhead line with some of the line placed underground. The discussion paper reaffirms the need for the North South transmission line project and that the existing proposal for a 400 kV overhead line remains the most appropriate solution for the project. In setting out its revised approach, EirGrid has confirmed that every project is different, so that an option that may be technically feasible for one project may not work for another.

The Deputy will be aware of the independent expert panel that is overseeing the integrity of the process being undertaken by EirGrid to report on the Grid West and grid link projects. The EirGrid reports are required to be comprehensive, route-specific studies of overhead and underground options for the projects. The panel has directed that the reports must be complete, comparable - with overhead line comparable with underground cable - and objective, and must include assessments of potential environmental impacts, technical efficacy and cost factors.

The panel will, in due course, consider the reports and then provide an opinion to me on the reports in respect of each project. Thereafter, a further round of public consultation will be undertaken by EirGrid for each of the projects. I expect to receive the panel's opinion on the Grid West project over the coming days. The opinion on the grid link project is expected during quarter three of this year.

Additional information not given on the floor of the House

Once these steps have been completed, it will then be a matter for EirGrid, in consultation with the Commission for Energy Regulation, to make a decision on which option to pursue on each of the grid link and Grid West projects.

Each of these three major projects will be the subject of a planning application to An Bord Pleanála in due course.

The report that was published, as I understand it, has options for undergrounding and made clear that Grid West and Grid South can be undergrounded. Why can this not be done with the North-South interconnector? This has been a huge bone of contention, particularly in Cavan, Monaghan and Meath in recent years.

Last week representatives from EirGrid appeared before the Joint Committee on Transport and Communications. The Minister gave the line that there are technical solutions to each project. However, speaking on the record of the committee they clearly confirmed that it was technically possible to underground the cables on the North-South interconnector.

This is the first time EirGrid has acknowledged that it is technically possible. It previously held to the view that it was technically impossible but now that it has accepted that it is possible to underground the cables, why does the Government not seek to put them underground? It has become a massive source of contention and if we accept the necessity of the project, the only option is the underground one.

As I am unfortunately not familiar with EirGrid's precise testimony to the committee, I cannot comment on it. I outlined in my initial reply the process undertaken in respect of all of these projects. The process involves EirGrid initially setting out its position and the independent expert panel then assesses the position and reports to me. That is the process we have undertaken in respect of grid west and grid link. The independent panel was also asked to examine the North-South project and it came to certain conclusions on the methodology adopted in respect of it. This is ultimately a matter for EirGrid when it brings forward proposals to develop the network we need in this country. I have no doubt that the North-South interconnector is critical infrastructure that we will require if we are to secure the system and the link between North and South. It is needed for the South and it is also needed for the North.

According to the information presented by the chief executive of EirGrid to the committee last Tuesday, one ducting would be needed in the channel for grid west and grid south and all that is needed to underground the North-South interconnector is a second one. I asked him about the technical issues arising because for the last several years EirGrid has argued that it is not technically possible to underground the North-South interconnector. I ask the Minister to review the chief executive's comments because he acknowledged that it was technically possible. Bearing in mind the significant concerns that have arisen in affected communities and the devastation that will be inflicted on them, the Government should meet EirGrid to discuss the underground option if it is technically possible.

I am not in a position to comment on what was said at the committee. However, I know from my knowledge of the project and the requirements in respect of the grid that technical feasibility is not the only aspect to be considered. All of us are aware that cost represents another dimension. The issue is one for EirGrid to address. It has brought forward its proposals and the independent expert panel has examined them. Technical feasibility is one aspect of the project but the cost will be a key factor in deciding on the approach to be adopted.

Gas Exploration Licences

Michael Colreavy

Ceist:

2. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources if he is satisfied with the Environmental Protection Agency progress report on unconventional gas exploration and extraction; and his views that the report provides enough information on the research carried out, as outlined by the terms of reference. [16438/15]

In March of this year, the EPA provided an update report on the programme of research into the potential environmental and human health impacts from unconventional gas exploration and exploitation. This report gave an account of the structure and scope of the research programme and provided details of funding and the constituent membership of the steering group established to oversee the procurement process to engage the relevant expertise to carry out the research, together with details of the successful consortium of consultants subsequently appointed.

The update report also identified the five component elements of the comprehensive programme of research, as follows: impacts on surface water, groundwater and related ecosystems; impacts on seismic activity; impacts on air quality; international operational practice and impact mitigation measures; and regulatory regimes for fracking in different countries.

I have received a further update report from the EPA which sets out in detail the specific tasks being undertaken by the consultancy consortium pursuant to each of the component projects, together with the status of these tasks. I am happy to share this detailed update and I have made arrangements to have it published on my Department's website. As I have stated previously, a final report will be published once the research programme has concluded. This final report will reflect the outcomes and recommendations on all elements of the research programme. It is expected that the report will be available in July 2016.

I am not and never will be a Minister but if I was a Minister who commissioned a progress report and I received a two page document comprising 43 lines I would throw it back to the body charged with preparing it. It is a disgrace that such a document was presented as a progress report. It contains little or no substantive information regarding the progress of the investigation of a very dangerous method of extracting gas. I believe it is bluffing the Minister of State, the committee and members of the public in regard to what progress is actually being made. It makes no reference to the health impact assessment, which is a crucial part of any study of hydraulic fracturing. It is outrageous that the EPA would seek to present this to the Minister of State and the wider public as a progress report.

I appreciate that the document circulated to the Deputy only comprises two pages but the progress report published on the website includes an appendix with a detailed breakdown of the stages of the investigation. It is a more informative document. I apologise that the Deputy does not have it but I will ensure he receives a copy following the conclusion of Question Time.

This is an important investigation and we are in the middle of a two year process. The Deputy and colleagues from various political parties, including my own, sought a mid-term review. It is important that we remain vigilant in ensuring the health and environmental issues are properly investigated. A revised frame of reference was developed on foot of a thorough and lengthy consultation process which took account of the various fears expressed at community level. I will continue to keep these matters under close review and I have asked my officials to keep Deputies informed.

I am heartened to hear that we will be given more details on the matter. I would have been worried to learn that the Minister had accepted the document before me as a progress report. I will examine the detailed information for proposals on carrying out a health impact assessment and the rationale for selecting a company called CDM Smith, which is on the public record as acting as a cheerleader for the fracking industry.

Yet it is leading this study.

One bit of information that came from the alleged progress report is that approximately 20 reports will be produced over the coming two years. Will the Minister of State ensure that each and every one of those reports is brought before the committee for consideration?

There was a broad range of experience on the evaluation panel. For example, members from An Bord Pleanála and current and retired members of different groups such as the CER, the Departments of Communications, Energy and Natural Resources, Environment, Community and Local Government, the Department of the Environment Northern Ireland, the EPA, ETH Zurich, Switzerland, Geological Survey of Ireland and the HSE. A comprehensive team of individuals made up the evaluation group to decide which company would be in a position to lead a combined grouping of individuals, groups and experts. While CDM Smith is the company appointed, there is a broad church in terms of the team. The team includes the British Geological Survey, UCD, Ulster University, Queens University Belfast and AMEC Foster Wheeler and Philip Lee. It is a team effort and there is a term of reference. That term of reference changed during the consultation process and the revised term of reference is the term under which the team must work on behalf of Ireland.

Energy Production

Thomas Pringle

Ceist:

3. Deputy Thomas Pringle asked the Minister for Communications, Energy and Natural Resources when he will publish the cost-benefit analysis report of wind energy and its potential effects on consumers' energy bills; the reason for any delay in publishing the report; and if he will make a statement on the matter. [16482/15]

This question relates to the cost benefit analysis report on wind energy and the impact it could have on the energy bills of consumers. When will the report be published and if it is delayed, what is the reason for the delay?

Analysis undertaken by the Department, the Sustainable Energy Authority of Ireland, EirGrid and the Commission for Energy Regulation has assessed the costs and value of choosing the path towards 40% renewable electricity generation in 2020, compared to a scenario where renewable electricity remained at 2013 levels. This analysis has informed a report which will be published shortly.

It is important to note that our transition to renewables has been underpinned by a number of previous studies. The all-island grid study, published in 2008, assessed the technical feasibility and the relative costs and benefits associated with various scenarios for increased shares of electricity sourced from renewable energy in the all-island power system. The scenarios were informed by the resource available, technological readiness of the various generation technologies and cost required per generated unit. The mapping for the analysis also assessed the deployment potential, based on where the resource was and an overview of environmentally designated areas. The 2008 study informed the position for a contribution of 40% renewable electricity in Ireland by 2020. It concluded that, based on assumptions set out in the report, wind energy represented a cost effective source for electricity generation.

The abundant wind resource in Ireland means that each unit of installed wind generation capacity generates more units of electricity when compared with other countries and hence needs a lower rate per generated unit of electricity in order to recover the overall costs of the project. The existing feed-in tariff, REFIT, which is funded from the PSO levy on consumer bills, is a cost effective tool to support this development, as indicated by a report published by the Council of European Energy Regulators earlier this year. This position has been underpinned by various reports and analyses which have examined the effect of renewables on electricity prices. The ESRI, the Irish Wind Energy Association, the SEAI and EirGrid have undertaken such studies and published the results of same. Furthermore, wind generation in Ireland in 2012 is estimated by the SEAI to have displaced fossil fuels, almost all of which would have been imported, to an estimated value of €177 million, with the value of avoided CO2 emissions being a further €11 million.

I take it the report will be published shortly, whenever that will be. It is vital the report is comprehensive and that we know the facts. There have been reports in a number of other European countries where subsidies towards renewable energy have led to significant increases in household bills for consumers. We are in a situation where a huge investment needs to take place in the transmission network in order to facilitate the development of wind energy across the country. When we consider that EirGrid intends to spend over almost €4 billion upgrading the transmission network to facilitate wind energy, this seems to be a costly exercise, particularly when there are other technologies available, such as biomass, which could be used to meet the targets without the need for the massive infrastructural investment.

Will the report examine the impact this will have on consumers' bills? Will it provide a breakdown of the impact as costs are passed on to the consumer? It is vital consumers are made fully aware of this.

As I mentioned, a number of reports and analyses have examined the effect of renewables on issues such as electricity prices. The Deputy is correct there is a cost involved. There is a cost associated with any of the technologies in terms of the supports and incentives we need to put in place. This issue is about accessibility of technology, the state of development of technology and the cost of technology in terms of investment. However, it is also an economic issue for the Exchequer and the Government, because it involves supports and incentives. Therefore, it is a State funding issue also.

The ESRI and IWEA studies considered the 2020 position, while a joint SEAI-EirGrid study looked at the position in 2011. I can give the Deputy additional information later or in a further supplementary response.

Will other technologies be investigated in terms of the potential costs? The wind energy programme was established in 2007 and at that time technology pointed to wind as being a solution. However, technology has moved on since then and biomass is very much a solution, requiring a significantly lower investment. I have seen figures that indicate that with 10% of the cost of the upgrading of the electricity infrastructure, we could convert the likes of Moneypoint to biomass and meet our Kyoto targets and our 40% renewable energy targets. The report must look at the potential for other technologies and must recognise that technology is continually advancing and that it may be time to look at the viability of wind against these newer technologies.

People make assertions about the level of investment involved and sometimes they think other technologies are cheaper, but when we delve into the issue and examine and analyse it, that is not always the case. However, we must keep these issues in mind in the context of the White Paper and the decision we will make later in the year. If we were to consider taking the biomass approach at Moneypoint for example, its capacity is 915 MW and its demand for biomass would far exceed the available biomass or potential biomass available in this jurisdiction. Some estimates suggest that 260,000 hectares of energy crops would be required, whereas to date, some 3,000 hectares have been planted under the bioenergy scheme run by the Department of Agriculture, Food and the Marine. Therefore, if we took that approach, the plant would be heavily reliant on imported biomass. Such large levels of import would raise considerations as to environmental sustainability of the operation.

I am keeping an open mind in regard to all of the new technologies, solar and others, in the context of the definitive White Paper we will publish in September. I would welcome the input of all Deputies on the issues, particularly in regard to renewables. Wind cannot solve all of our problems. It has been cost effective, but the Deputy is correct. We must ensure we look at all of the other available technologies. However, we cannot assume, without comprehensive analysis, that some of the newer technologies will be cheaper or more viable.

National Broadband Plan Implementation

Michael Moynihan

Ceist:

4. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources if he will provide the latest update on the Government’s application to the Commission for state aid approval of the national broadband plan; and if he will make a statement on the matter. [16437/15]

My question asks the Minister for the latest update by the Government to the European Commission for state aid approval of the national broadband plan.

The national broadband plan aims to ensure that every citizen and business, regardless of location, has access to a high quality, high speed broadband service.

In tandem with commercial developments, intensive work is under way in my Department to progress a State-led investment to secure the countrywide introduction of next-generation broadband access.

As the Deputy is aware, there was a public consultation and a national high speed coverage map was launched last November. The map can be accessed through a Department website that allows members of the public to see whether their premises or home will have access to commercial high speed broadband services by the end of 2016 or whether they will be included in the Government's proposed intervention. A public consultation on the map closed on 12 February and that exercise will help inform the key decisions that are now required to be taken in order to finalise our comprehensive intervention strategy, which will be published for consultation in July. The publication of the map and consultation is necessary to ensure that the State intervention does not compete with commercial high speed broadband services and is required under EU state aid guidelines. Formal notification will be made after consultation on the intervention strategy is completed later this year. In the meantime, the Department continues to liaise closely with the Directorate General for competition on a range of issues related to the strategy and we intend to be in a position later this year to submit a pre-notification to the directorate.

Intensive design and planning work is under way in my Department to produce a detailed intervention strategy. This will address a range of issues relating to the intervention, including the optimum procurement model, ownership model for the infrastructure, intervention cost and likely market impact. My Department has engaged external advisors to provide legal, economic, technical and financial advice on the various aspects of the plan over the next two years. The next steps will see a further public consultation on a detailed intervention strategy in mid 2015. In this regard, the Department will design a tender in a way that maximises efficiencies and keeps the cost to taxpayers as low as possible. It is expected that the physical build of this network will commence from 2016. It is a complex and ambitious project that is a key priority for Government and for me.

When will this be submitted to the European Commission? The Minister gave a date of June 2015 at one stage for state aid approval but where is that now? This looks like a never-ending saga. The broadband plan was announced this time last year, before local and European elections, to great fanfare. It was to resolve issues but, to my mind, nothing has yet happened. When will this formally be presented to the Commission? When will we see credible action on the ground?

With respect to the Deputy, if he read the monthly reports that I publish on the progress of the national broadband plan, which I undertook to do in this House last autumn, he would see a considerable amount of work ongoing with the national broadband plan. There is hardly a day in the Department when we do not have consultation or work proceeding on the plan. I would be very happy to brief the Deputy separately and privately if he so wishes, or publicly here on another occasion, on the enormous amount of work ongoing with the national broadband plan. I am not one for fanfare or repeated announcements but I am one for ensuring the work will progress. I assure the Members that work is progressing.

The guiding principle for the state aid process is that any state intervention should limit, as much as possible, the risk of crowding out or replacing private investment, or altering commercial investment incentives and ultimately distorting competition. That is viewed as contrary to the common interest of the European Union.

I have followed the issue. When will this come before the European Commission? I know why it must go before the European Commission and that work is ongoing. In my previous comments I asked when it would come before the European Commission. Why was it not put in the April 2014 announcement that this would have to go before the European Commission? This is probably one of the most fundamental issues facing Irish society. Are we going to crowd people into cities and towns while leaving significant parts of the country underpopulated because of a lack of services like broadband, as I have said on numerous occasions? May I have a straight answer on when this will come before the European Commission for considerations with respect to state aid approval? When will the application be submitted?

State aid notification is a two-stage process. There is pre-notification and formal notification. Currently we are in the pre-notification stage. We have external advisers testing the proposed strategy against the principles of state aid guidelines to ensure compliance. The first draft of this compliance report is due at the end of this month and, thereafter, ministerial approval will be required for a pre-notification submission. Once received, the pre-notification will be sent to the European Commission, which will assess the pre-notification and potentially seek clarification from us. To try to answer the Deputy's question as best I can, we are pressing the issue, and it is envisaged that the formal notification - the second stage of the proposed intervention - will be sent to the Commission in the fourth quarter of this year. I assure the Deputy that all the work we are doing now in the pre-notification stage will ensure that when we get into the formal notification, enormous amounts of contact will have taken place with the Commission and the directorate. We hope that most of the questions that the Commission would want to ask us would already have been addressed in the pre-notification stage. We are working very hard, carefully and diligently on the issue.

Energy Efficiency

Michael Colreavy

Ceist:

5. Deputy Michael Colreavy asked the Minister for Communications, Energy and Natural Resources the efforts that have been made at European level to ring-fence funding for energy efficiency measures; and the position the Government has taken. [16494/15]

I ask the Minister the efforts that have been made at European level to ring-fence funding for energy efficiency measures and the position taken by the Government with respect to those measures.

Energy efficiency is crucially important to each of three pillars of energy policy, which are sustainability, security of supply and competitiveness. My Department is continuing to develop and enhance policy in this area and the Sustainable Energy Authority of Ireland is continuing to implement policy with the roll-out of efficiency measures in homes and businesses throughout the country. Ireland is strongly committed to playing its part in meeting EU energy and climate goals. To meet these obligations, Ireland must maintain a very significant level of effort. In order to do that, we must deliver energy infrastructure and policy initiatives of real scale. This requires investment of an equivalent scale and this is why EU funding is of critical importance for Ireland's successful delivery of our sustainable energy transition. As the Deputy may be aware, I will publish a definitive energy policy paper later this year, which will set out the key energy policy actions to be undertaken in the period to 2030.

There are complex interactions both within energy policy and between energy and the wide range of other policy areas that may be invested in by the European Fund for Strategic Investment, which is currently under negotiation. Therefore, it is important that the governance arrangements for EU funding proposals allow the European Investment Bank sufficient latitude to optimise the value of these funds in the interests of achieving coherent action across all EU member states and value for money for EU citizens.

It has been reported that last month our Taoiseach ordered Mr. Seán Kelly, MEP, to vote against a proposal that would earmark €5 billion in the European Parliament for energy efficiency. I understand Mr. Kelly originally put his name to the proposal but withdrew it after a phone call from the Taoiseach. If that is true, how does that sit with the Government's objectives of fully exploiting and supporting renewable energy in this country?

Negotiation is under way on the European Fund for Strategic Investment, which is the context of the issue raised by the Deputy. The Department of Finance is leading those negotiations for Ireland. The Council's negotiating position on the draft European Fund for Strategic Investment regulation was agreed at ECOFIN in March this year. A key element of this position was that the governance arrangements for this fund should not be overly prescriptive regarding the European Investment Bank scope to manage the fund. Ireland supports the Council position.

The European Parliament agreed its negotiation position on the regulation this week. The European Parliament took a different approach to the Council and called for the ring-fencing of funding for energy efficiency. This is a matter for the Parliament and the Government's position remains aligned with that of the Council, as agreed last month. Officials from this Department are in communication with the European Commission as they work to establish how best to fund sustainable energy projects, including energy efficiency, from the European Fund for Strategic Investment and other financial instruments. This work is in its early stages.

Is the Minister confirming that the phone call was made and the action followed the phone call? If so, that would raise a very serious question mark. Currently, we are importing the vast majority of energy through fossil fuels and that is not sustainable into the future. Sustainable renewable energy must be developed and promoted here, as well as energy efficiency.

I understand the proposal to earmark €5 billion was eventually passed by a single vote, notwithstanding an instruction, which was inspired by the Taoiseach, to Seán Kelly, MEP, to change his position on the issue. This needs to be explained and I would like more than a restatement of what the Minister claims to be Government policy and priorities.

Energy efficiency is extremely important and has been accorded a high priority by me and the Government. I have contributed to a number of EU Energy Council meetings on the issue which I regard as an extremely important policy imperative. Energy efficiency features centrally in the current negotiations on the European fund for strategic investment for this reason. Ring-fencing is one approach that has been discussed in the European Parliament. The Government's position is correct; we should not be excessively prescriptive regarding the scope of the European Investment Bank to manage the fund. The debate on this issue is continuing.

As to any particular telephone call between the Taoiseach and Seán Kelly, MEP, I am not privy to, nor am I aware of, any such telephone call and I do not know whether one took place. The Deputy has another route available to him if he wishes to ask a question about the matter.

I may go down that route.

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