Oireachtas Joint and Select Committees

Tuesday, 25 May 2021

Joint Oireachtas Committee on Climate Action

Reduction of Carbon Emissions of 51% by 2030: Discussion (Resumed)

Mr. Dara Lynott:

I will go through a number of those issues and will ask Mr. Douglas to come in on the ETS issue at the end. On delivery, our study projected beyond 70% because even as a study is written, things move on and it becomes out of date almost the minute it is written. Of course, within the programme for Government a number of additional ambitions were put in place.

The Deputy asked whether electricity can up its game to deliver beyond that 70%. The answer is "Yes". Our study looked at some of the ways we would do this. An extra 5 GW of offshore, indicated in the beyond carbon action plan in the programme for Government, would lead to an extra 1.3 million tonnes, but that would again rely heavily on batteries. In the scenario presented in our study, battery usage would increase battery storage to 2.4 GW.

Additional interconnection would also be needed beyond the Celtic, Greenlink and North-South interconnectors, and it would be necessary to rely on at least one of the gas plants having some form of carbon capture and storage. That is not to say anything about the operations of the grid. At that point, one would have to reduce. Currently, the requirement is for six generation plants to be on minimum generation. That would need to drop below four and approach zero, which means relying on certain system services from technology not currently available.

The answer is "Yes, this can be done", but there are challenges around operating a system beyond 70% and delivering 5 GW of wind, in addition to developing 2.4 GW of battery storage, additional interconnection and post-2030 technology such as hydrogen and carbon capture and storage. Our study states this is not possible by 2030, but beyond 2030 is where the next bit needs to happen.

Regarding microgeneration, again, as part of the final design we are waiting for what the Department and regulator will set out on remuneration. It was expected the July deadline would be met but given the timeline suppliers will need to bring in a microgeneration scheme for their customers, it is doubtful it will be.

However, we await word from the Department on that.

In terms of the signals, at the moment, in terms of market design, we rely on a number of remuneration mechanisms, whether that be through system services for energy itself or for a capacity market. Things are going to change fairly radically out to 2030. Current facilities and energy generation on the system will be used a lot less. We will have far more renewables on the system. Our view is that the regulator has to look at all of these remuneration mechanisms to ensure the right mix of generation is on the system in 2030, relates to each other, is very much integrated on the system and attracts the level of investment necessary to ensure we have a very reliable and safe electricity system. Given some of the amber alerts we have had this summer, I believe the regulator is going to run what is known as a T minus 3 option to secure additional capacity in generation in the next few years. I might bring in Mr. Douglas to talk about how data centres are dealt with through the ETS and their impact.

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