Pat Rabbitte (Dublin South West, Labour) | Oireachtas source

I doubt the veracity of that, Deputy Dooley.

I am glad to be here to discuss the recently published Green Paper on energy policy. The many developments at national, EU and international level since the energy White Paper of 2007 make it timely to review our energy policy and to consider how best to shape it for the future.

The context in which these discussions will take place is inevitably complex, with many interrelated strands and competing interests. The cornerstone of energy policy will continue to be the three pillars of sustainability, security and competitiveness. In addition, there is increasing recognition that the energy sector is an important contributor to the economy both financially and in terms of the numbers employed in the sector. It has the potential to generate further economic activity and real employment.

The Green Paper is taking a long-term look at the policy, the regulatory and societal interventions we need to make in the coming years. Government, industry, system operators and the public will all need to make sound evidence-based choices.

In developing our energy policy for the future we face several key challenges, including reconciling competing and interrelated dynamics of the three pillars, to ensure good equilibrium and maximum flexibility on an evolving energy landscape; significant international policy developments such as the impact of indigenous shale gas in the United States on EU energy prices and geopolitics generally; the United Nations fifth report on climate change and the need to closely align climate change and energy policy; the importance of informed engagement by the public in energy debates, especially on affordability, renewable energy, climate change and energy infrastructure; and the potential of energy policies to transform the economy and stimulate jobs and growth. The challenge for policy makers is to find the right balance of measures, taking account of these complex interrelationships and the need to maintain the economic and social fabric nationally and regionally.

In view of these many and complex energy challenges, I considered it timely to publish the Green Paper to stimulate an informed debate on the future shape of energy policy. I decided that, set against the backdrop of the three energy pillars and the need to stimulate economic growth, the paper should focus on a number of key themes. This does not preclude anyone from raising other issues during the public consultation process. The six priority themes chosen are empowering energy citizens; markets, regulation and prices; planning and implementing essential energy infrastructure; ensuring a balanced and secure energy mix; putting the energy system on a sustainable pathway; and driving economic opportunity. There are inevitable tensions between competing policy objectives. Resolving these complex and interrelated policy choices is critical, especially if we are to encourage the right conditions for economic recovery and job creation. These difficulties are further compounded by the continuously changing energy landscape. For example, the International Energy Agency’s World Energy Outlook for 2012 highlighted the significant change on the global energy landscape which had taken place owing to increased deployment of hydraulic fracturing and horizontal drilling. The USA’s unconventional oil and gas production is having a profound impact on international energy markets and prices and likely to have significant implications for EU competitiveness and geopolitics generally.

Of equal importance is how to reconcile energy policy and climate change. This has been underscored in the United Nations’s fifth assessment report which concluded that the effects of climate change "are already occurring on all continents and across the oceans" but that the world was "ill-prepared for risks from a changing climate". We have a progressive position on climate protection, but we also have a long way to go in terms of economic recovery, particularly in the context of the challenging greenhouse gas mitigation target for 2020 set for us under EU law. It is clear that an equitable distribution of effort sharing will be required in allocating national contributions to achieving new targets under the 2030 climate and energy framework. Economic development and low carbon transition are not mutually exclusive and can be progressed in parallel, provided we advance on an informed and sensible course.

Involving the citizen in debates on energy and climate change must be central to policy development. We need to develop balanced and far reaching policies on areas such as grid development, the use of wind resources and the streamlining of public permitting and consent procedures. In doing so, it is important that past lessons are learned and that we adequately address valid public concerns about the impact of policies on the environment and health and safety, while, at the same time, ensuring security of supply and cost effectiveness. The Green Paper aims to encourage a wide ranging debate on this critical issue and I look forward to suggestions on how we can achieve effective and informed public participation and engagement.

I refer to prices, an issue that is important for all energy consumers, whether residential or business. Prices have been fully deregulated in the electricity retail market and the regulator has decided on 1 July as the date for complete deregulation of gas prices. Consequently, prices are mostly set by suppliers and commercial and operational matters for them. Customers can and do avail of competitive offerings from electricity and gas suppliers. We have a limited capacity to influence prices, as electricity and gas costs in Ireland are influenced by various drivers outside our control. These include global gas and oil prices, the cost of capital, exchange rate fluctuations, the small size of the Irish market, geographical location and our low population density. The most important factor affecting electricity prices in Ireland is the continuing upward trend in international gas prices. To mitigate the impact of these factors, we must remain focused on controllable costs bearing in mind their limited extent. Increasing the penetration of indigenous secure renewables and adopting greater energy efficiency measures in homes and businesses are among the most significant ways we can counter the effects of cost drivers.

The promotion of energy efficiency is an area within our control where action can be taken to reduce energy costs. Initiatives such as the new €70 million national energy efficiency fund will act as a catalyst to develop energy efficiency projects in the market and enhance the level of finance available to support the clear energy and cost saving opportunity for public and commercial sectors. The development of indigenous sustainable sources of energy will also help to offset the impact of volatile fossil fuel prices. I hope to hear innovative and creative suggestions on the further steps we might take during the consultation phase on the Green Paper. I hope to publish a new bioenergy strategy in the coming weeks which will inform the debate on how best to put the energy system on a sustainable path. A more indigenous low carbon economy, centred on energy efficiency, renewable energy and smart networks, offers great scope to address the interrelated challenges of climate change, energy security and competitiveness. Achieving this transformation lies at the heart of the Government’s energy policy.

As we develop the new technological know-how to manage the electricity system of the future, we are creating opportunities for Irish-based companies to become world leaders in smart grids and deliver working solutions a decade ahead of their international competitors. In building on our strengths we have the opportunity to further develop Ireland’s reputation in the renewable energy sector as a place of excellence in research and the development of new technologies.

To sum up, we need a new transformative vision for a robust energy policy framework for the future. The Green Paper provides an opportunity to reflect and take stock of our current position and adopt a long-term view on the interventions necessary to help to shape future energy policy. Competitiveness, security of supply and sustainability, as well as energy policy’s potential to support economic growth and job creation, will remain at the heart of energy policy as we move forward. I look forward to an informed and robust debate and would like to encourage everyone to engage actively in the public consultation process in order that we can collectively transform the Irish energy system for the coming years.