I propose to take Questions Nos. 103 and 118 together.
District heating is a proven technology that can decarbonise the built environment, diversify fuel sources for heat, and improve quality of life. The 2022 National Heat Study identified the potential of district heating to supply up to 54% of heat nationally and, crucially, identifies the prospect of using this technology in large towns and cities across Ireland where demand is concentrated, and heat sources are prevalent.
The District Heating Steering Group Report was approved by Government and subsequently published in 2023. The report contains a suite of recommendations to support the development of district heating in Ireland. The General Scheme of the Heat (Networks and Miscellaneous Provisions) Bill 2024, drafted to give effect to the recommendations of the Steering Group, was approved by Government on 30 October 2024. The legislation has been designed to provide, inter alia, a legislative underpinning for the district heating sector; regulatory certainty for district heating project sponsors; safeguards for the State in terms of district heating network ownership; and consumer protections, including for communal heating network customers. The Programme for Government commits to enacting legislation in 2025 to accelerate the roll out of district heating systems.
The Government has financially supported the development of district heat networks in Ireland through the Climate Action Fund (CAF). There is a large-scale scheme operational in Ireland, which was developed by South Dublin County Council (SDCC) in Tallaght and supported through funding from the CAF. SDCC are currently expanding their current heat load and phase 2 of this scheme is now being appraised.
In addition, the Dublin City Council District Heating Project will use waste heat from the Dublin Waste to Energy facility in Poolbeg to heat public sector, commercial and residential buildings, initially in the adjacent area with plans to expand into Dublin City. This project has an indicative allocation of €50 million through the CAF, pending the approval of business case.
Engagement with the sector on developing the District Heating Steering Group Report indicated a pipeline of potential district heating projects, including potential projects outside of Dublin. The majority of these projects are in the early stages of development. Project funding has been identified as a key barrier for project development in Ireland. My Department, with the SEAI District Heating Centre of Excellence, are currently preparing a business case seeking to secure future State funding for the period 2026 to 2030 to support efficient district heating projects.
As recommended in the District Heating Steering Group report, work is currently underway to widen the Support Scheme for Renewable Heat (SSRH) to support large scale, efficient district heating projects. An enhanced SSRH is seen as a suitable funding mechanism to deliver such supports. However, while communal heating systems using heat pumps or biomass/anaerobic digestion technologies are already eligible for supports under the SSRH in its current form, it is necessary that vital components of larger district heating projects, such as pipework and energy centres, are also identified as allowable expenditure under the scheme’s terms and conditions. Additionally, given the complexity of large-scale district heating projects and the increased level of capital investment supports necessary for their development, appropriate project evaluation and reporting will be required. Both my Department and the SEAI will continue work on adapting the scheme to ensure it is ready to provide supports once funding has been secured.