Oireachtas Joint and Select Committees

Tuesday, 6 July 2021

Joint Oireachtas Committee on Climate Action

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

Ms Aoife MacEvilly:

I thank Senator Boylan. I will start with the PSO. The Senator outlined perfectly the manner in which the PSO levy costs are allocated between the various consumer groups. This is set out in legislation. It is not something we designed or chose. It is on foot of state aid applications to and decisions by the European Commission that this methodology was deemed to be the best approach. It is set out in legislation. I would not say it necessarily lets data centres off the hook. They will be paying PSO levies. What the ESRI research has suggested is that a different approach might levy a higher proportion on data centres if we were to go down that road.

I know much has been written about the manner in which a PSO levy is distributed between various customer groups and household customers. Any change is likely to create winners and losers, even in the domestic sector. For example, moving to a per usage or per kilowatt hour usage approach in the household sector might benefit people who have been able to invest in energy efficiency or microgeneration. It might be more difficult to accommodate households that cannot afford to do this. It is an area in which we have to tread very carefully. At present, a review of this approach is not in the CRU's work plan. If we do find over time the methodology creates a level of inequity beyond what we anticipate or what can be seen at present it is something we could look at. We must bear in mind that at present it is based on state aid and the legislation. It is not an area in which we have an immediate ability to change.

Looking at data centre demand, we have spoken about the electrification of heat and transport. At present, this does not drive a significant increase but we expect this to change over time. We were looking out to 2030. It has to be said that while we see increasing demand from the electrification of heating and transport, the very large driver of the rapid increase in demand we see is with regard to data centres. This is the case.

With regard to microgeneration, the Minister has consulted on a scheme and we have been engaging to the extent that we can to support the Department on it. No decision has been taken as yet. I cannot comment on the final decision or the approach the Department and Minister will ultimately take. From our perspective, what we would like to do is address the twin inequity. At present, it feels very unfair to customers who have solar panels on their roofs who export electricity to the grid but are not getting any compensation or value for that contribution. We believe it is important that a market-based price is given to these customers. It is then a matter of policy for the Minister to determine whether an additional contribution should be made. From our perspective, the challenge is also about providing options to customers who do not have this ability to invest. They may be renting. They are not in a position to make multi-year investments. Through our smart metering programme, we want to give those customers options in order that they can do things such as demand-side management, time-of-use tariffs or other contributions so they also have options to lower their bills.

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