Ms Bernie Gray:

Currently, only one case has gone to arbitration with respect to the issues experienced by people. The vast bulk of the participants in the partnership scheme are satisfied.

The second issue the Senator raised related to the rural economy, in particular, the desirability of adding value in each county of Ireland, particularly given the level of afforestation in Mayo and the processing of the outputs from that afforestation elsewhere in the country.

Deputy Pringle mentioned that the Forestry Act is the core legislation for Coillte, which undoubtedly it is. It places a major responsibility on Coillte to operate in an efficient and effective way in the interests of the Irish State to optimise the return for Ireland. There is a trade off in achieving that level of optimisation in terms of efficiency and effectiveness. Ideally, it would be great to have regional centres for pulp processing close to where the forests lie. Unfortunately, the economies of scale currently do not support that. One of the key issues that arises currently with Medite Smartply in our two processing centres is the renewed possible level of capital investment in those plants to maintain their current levels of efficiency. Coillte has to make a judgment as to where those resources are best deployed and make very careful investment decisions, which of themselves will yield a proper return. Currently, while I can identify with the desirability of having the processing of wood closer to the location of afforestation, unfortunately the economies of scale do not support it.

Regarding joint venture development and the status of the current joint venture discussions with the ESB on renewable energy, those discussions are ongoing and the next milestone in those discussions will be around May as to where they might go or whether we can reach an acceptable path forward. One of the key issues in utilising Coillte's resources is that approximately 20% of the land in Coillte is not optimal for afforestation but it has height and access to wind. The point at issue is what should Coillte's role be in making use of that portion of the asset. The conclusion Coillte reached in its last strategic review is that it is best deployed in the development of a renewable energy source but not as an operator of it. It is not the core business of Coillte to run renewable energy areas but it certainly has an expertise in developing them because it knows its resource and where the best potential lies. That is why Coillte disposed of its shareholding in three wind farms last year. It recognised it should use its expertise within its core business and where opportunities present themselves, to use those assets in a optimal way to bring them to a stage of development where it can partner with somebody else who has greater expertise in renewable wind farms. The ESB is one of those potential partners.