Mr. Gerard Murphy:

I wish to take the committee through the activities of the forest division of Coillte and its role in helping to achieve the objectives relating to Food Harvest 2020, particularly in respect of climate adaptation, carbon mitigation measures and biodiversity. The forest division is responsible for the management, protection and stewardship of the State's forests, a resource which is very important in helping to mitigate the effects of climate change. This assertion is underpinned by a national forest inventory statistic which shows that the Coillte estate has a stock of over 200 million tonnes of carbon locked in its forests and soils. In the context of the 445,000 ha it manages, the division carries out a wide range of activities from planting, tending and protecting the company's crops to forest road building, the harvesting and sale of roundwood and providing public goods.

I have included a number of statistics in slide No. 4 to illustrate the scale of our operations and the importance of what we do in supporting the wider forest industry and rural development. The lands for which Coillte is responsible represent over 7% of Ireland's landmass and the company sells almost 2.5 million cum of roundwood to a diverse range of industrial users. This accounts for approximately 80% of the total roundwood available in the market. Each year we plant approximately 6,000 ha of forests with 15 million trees. We maintain 9,500 km of forest roads and trails, building a further 100 km of new roads each year. In total, we reinvest over €30 million into our forests every year in the context of replanting and tending trees and building roads. Some 18 million recreational visits are made to our forests annually. A total of 20% of our estate is managed primarily for the purposes of biodiversity. Our sustainability credentials are certified by the international and independent Forest Stewardship Council, FSC, which is very important in the context of accessing international markets for the industry's finished products. This year, we hope to be endorsed by the programme for endorsement for forest certification, the PEFC standard, and to have our environmental management systems certified to ISO 14000 standard.

Coillte has a presence in every county in Ireland and is a very important contributor to rural development. The forest division alone employs over 450 staff and engages approximately 460 contractors who, in turn, employ over 1,300 people. The division is organised into regional units - business area units, BAUs - in order that decision making is decentralised as much as possible. We developed a new strategy for the division last year and our ambition is to become recognised internationally as a leading sustainable and commercially successful organisation - delivering roundwood and public goods in a manner that will be highly valued by the shareholder, our customers and our stakeholders - in the next five years. There are five central themes to our strategy and these are very closely aligned to the Food Harvest 2020 themes of acting smart, thinking green and achieving growth. These themes include being more efficient, investing in our people and systems and ensuring we are competitive on a sustainable basis. We are aiming to be smarter in what we do in the context of improving the performance of our estate, mainly through optimising the use of our estate through a flexible set of silvicultural regimes and plant material, improving the productivity of our estate and aligning all our compliance and certification requirements. We provide significant public goods to society. Our strategy is to seek recognition for these goods and thereby ensure that the value of the forest estate will be recognised in a more substantial manner.

We want to unlock the considerable value of the private forest estate through supporting the mobilisation of the private supply which is due to become available during the next ten years. I will elaborate on this strategy, particularly in terms of how it supports and assists in the development of the carbon stock in our estate.

The mitigation benefits of forests as a carbon resource and a sink for carbon sequestration is well documented but also forests can provide a role in offsetting the negative impacts of climate change such as reducing flood risks. We have seen that in the recent months with the level of flooding that has occurred here. I have identified four areas of Coillte forests that can support the State's policy on carbon mitigation and sequestration. It is well documented that establishing forests increases the capacity of carbon sequestration. For example, for every hectare planted three to 15 tonnes of CO2 per annum is removed from the atmosphere but, obviously, that depends on the soil, the species and the age of the crop. We plant 5,500 to 6,000 hectares annually under our reforestation programme which ensures that the carbon pools locked in our estate are maintained and enhanced. We also support the national afforestation programme, which is driven through incentive schemes, to encourage farmers to plant their lands by providing specialist management services, markets for their thinnings, advice and access to our road network. The latest wind blow is an example of where we have worked very closely with local forest landowners to deal with the aftermath of the storm. We also have more than 700 farm partnerships in managing approximately 12,000 hectares of forests.

Another area that is very important in increasing carbon sequestration, especially as land becomes more difficult to source for forestry, is to increase the productivity of the existing forest estate. This can be achieved by utilising the right species and using properly adapted forest reproductive material. We have found that improved material of the right provenance can improve growth productivity of the estate by 20%. There is a direct correlation between forest productivity and increased carbon sequestration. Coillte has an advanced tree improvement programme for our major species that have been developed over 25 years as well as maintaining a range of seed orchards, the seeds of which are available for the wider industry. I believe there is significant uplift potential in the productivity of both the private and public estate through the proper use of the right forest reproductive material. Another way of increasing forests productivity, as well as the benefits of replacing fossil fuels, is to investigate the possibility of using fast growing forest energy crops. We have hundreds of hectares of trials in eucalyptus and other species which produce significant yields of wood in short rotations. We are investigating whether they are adaptable to Irish conditions.

To ensure that forests capture carbon on a net basis, it is also crucial that there are sustainable supply chains developed across the industry. Having a strong chain of custody in independent schemes like SFC or PFC gives the confidence that forests are being managed on a sustainable basis. Over the last ten years we have also supported the development of a viable contractor base in harvesting and haulage and work to ensure that proper training regimes are in place, especially in health and safety. Training in harvesting and haulage will remain a key challenge for the sector over the next number of years. We are also developing supply chains for energy wood that replaces fossil fuels and my colleague, Mr. Mark Foley, will expand on this later.

The final pillar of carbon mitigation is in the use of low carbon building products. Wood after harvesting continues to lock in carbon, as is the case with sawn wood produced by our sawmill customers or panel boards produced by our Coillte panel board mills. The increasing demand for energy efficient construction is driven by carbon mitigation measures such as the EU directive on energy performance in buildings. We believe concepts such as zero carbon construction in reducing carbon emissions are driving significant change in the market. This concept seeks to have a yearly net carbon footprint of zero and is achieved, first, by reducing the energy consumption needed in buildings and, second, utilising materials with low carbon emissions related to the manufacturing process. The OSB and MDF products that we produce contribute very favourably to this type of construction due to their use in highly thermal efficient off-site construction systems and through the carbon locked in the material.

I would like to conclude by showing how the forest estate further contributes to the "thinking green" theme of Food Harvest 2020 in the area of public goods. While more than 25% of our forest estate has statutory environmental designations, nearly 40% of our estate is managed with some form of environmental designation. We manage and protect these areas using an environmental management system which we proactively develop and improve. However, our strategy is to be even more proactive and to create a greater awareness of the type of public goods we provide and to seek recognition for them. In association with the Heritage Council, we commissioned an independent study to quantify the economic value of biodiversity, cultural heritage and landscape protection. The study, which has just been published, calculated that the value of these public goods was more than €500 million. A previous study on forest recreation showed a direct value contribution of €97 million and a further €270 million generated to the local community in terms of visits to the forests.

Our policy is to work with local communities and local authorities in developing these facilities. A number of significant examples in this area on which we have worked include the Ballyhoura Mountain trial bikes, Lough Key forest park, the Dublin Mountains Partnership, Wild Nephin and the Cavan Burren Park. Another good example of biodiversity work, which has strong links into the area of carbon sequestration, is the work we have been doing in restoring bogs under an EU Life funded project. More than 5,000 hectares are being restored back to their original state of bogs. We believe there is a need to develop innovative means of recognising the value of these initiatives in order to use the potential of these public goods to further drive rural development.

In conclusion, we believe that forestry and Coillte's key role in the sector provide important contributions to the national agenda on climate adaptation. We continue to be committed to playing a constructive part in national policy. I will hand over to Mr. Mark Foley who will take the members through other contributions we make in reducing our carbon footprint, particularly in the area of renewable energy.