Mr. Nicholas Tarrant:

I again thank the committee for the invitation to the meeting. I am joined by Mr. Joe Duignan, the regulation and commercial manager for ESB Networks. We welcome the opportunity to speak to the committee about our central role in facilitating the transition to a net-zero society and achieving the targets set out in the Government's climate action plan.

This is a time of significant concern for both industrial and domestic customers, with large increases in the cost of electricity and the impact of the Russian invasion of Ukraine, together with concerns about security of supply. It is more important than ever that Ireland accelerates its climate action response and achieves improved energy security based on a low-carbon energy system.

I am briefly going to explain ESB Networks’ role in the electricity sector and then I will cover a few key points on renewable connections. In our submission we also included a few summary points on the national smart metering programme and our national networks local connections programme. Both of these programmes are building blocks for the energy transition and the electrification of heat and transport but in the interest of time I do not plan to cover them in this introduction, although I am happy to take any questions on them from members.

I mention the role of ESB Networks. ESB Networks plans, builds, maintains and operates the electricity distribution network. We also build and maintain the electricity transmission network, the planning and operation of which is the responsibility of EirGrid. Since 1999, these licensed activities have been overseen by the Commission for Regulation of Utilities, CRU. ESB Networks is a ring-fenced part of ESB Group and there is strict regulatory separation between ESB Networks and the areas of ESB Group responsible for generating and selling electricity. ESB Networks has served all electricity customers for 95 years and we have a proud history of delivery and innovation. We work every day to deliver electricity safely and reliably to all customers, irrespective of who they buy their electricity from. We provide a 24-7 emergency response. During outages in severe weather, our crews work to restore electricity to affected areas as soon as is it is safe to do so.

We have approximately 2.4 million customers and to give a scale of the network we have: 158,000 km of overhead lines; 27,000 km of underground cables; and 670 high-voltage substations. Approximately 30,000 new customers connect to the network every year. The CRU approves the electricity network investment and operation expenditure through five-year contracts called price reviews. ESB Networks invested €5.3 billion over the past decade and during the period of the price review from 2021 to 2025, which is Price Review 5, we plan to invest €4.4 billion in electricity infrastructure. Each year our investment programme is delivered through our 3,400 employees and specialist contractors, and is supported by a global supply chain.

I will move to ESB Networks and climate action. The electricity distribution system is evolving to become a low-carbon electricity network where 80% of the electricity generated in Ireland will come from renewable sources by 2030. The electrification of heat, transport and our economy will see citizens and businesses adopting low carbon technologies, including heat pumps, electric vehicles, and microgeneration such as roof top solar. ESB Networks is at the centre of the transition to a low carbon energy society, and we are proud of our leading role in this transformation. In fully supporting the Government’s climate action plan, ESB Networks has delivered all our lead actions to date and we are supporting the progress and delivery of many other actions.

I will make some final comments on connecting renewables to the electricity network. Ireland and ESB Networks have a strong track record in connecting renewables. Today there are over 5 GW of renewable generation connected to the electricity system. We expect to have connected 25 new grid-scale renewable wind and solar projects during 2022, increasing the total to 5.4 GW. A further four battery energy storage projects are also expected to be connected, totalling 80 MW. The combination of the Government’s renewable electricity support scheme, RESS, auctions and the regulated connection process is delivering a strong pipeline of projects each year. These are essential to ensure a steady drumbeat of projects connecting to the system each year between now and 2030 in order to reach the climate action plan targets. ESB Networks will continue to work in partnership with generators and all key stakeholders to ensure delivery of these targets.

Since 2011, electricity network generators have the option to build their grid connections, except for specific works that ESB Networks must carry out, such as work in live electricity substations. This gives generators control and choice over who builds their grid connection. When customers choose ESB Networks to connect a generator to the system, we design the minimum technically acceptable connection method. Our charges are benchmarked and are approved by the CRU. Costs vary depending on the upgrade works required. Regulated charging policy requires that the cost of upgrade works to the network is borne by the generator.

I will finish with some of the recent key achievements in this area. The year 2022 is likely to be a record year for renewable generation growth, with approximately 700 MW of new renewable generation expected to be connected, bringing the total to 5.4 GW. We are processing in the region of 90 grid-scale connection projects every year. These include commercial solar and wind projects, community projects and auto-producers.

We have also put systems in place to allow for electricity suppliers to settle energy payments for microgeneration electricity exported to the grid. Over 40,000 microgeneration customers are now registered with ESB Networks and we expect many more to do so over the coming years. In December 2021, in line with the climate action plan of 2021, CAP 21, we launched the mini-generation pilot for connections of less than 50 kW. We have since extended this to 650 applications. Last week, we were very pleased to launch a small-scale generation pilot for connections between 50 kW and 200 kW.

In summary, there has been very significant progress in the growth and deployment of renewables and the initial stages of the electrification of heating and transport. The collective challenge now is to build on the very positive progress to date and to achieve the targets in the Government’s climate action plan, and beyond that to net zero. We are happy to take any questions from the committee.