Oireachtas Joint and Select Committees

Wednesday, 6 December 2023

Joint Oireachtas Committee on Social Protection

Water and Energy Connections in Rural Areas: Discussion

Mr. Jim Gannon:

In the first instance on the price reviews and controls and revenue control in the case of Irish Water, the CRU is the independent reviewer and regulator to perform that review around cost efficiency and planning. Over the course of a price review or price control, it is an 18-month to two-year activity. The CRU initially sets out priorities in line with Government policy at the time and that can change over time. Separately, we engage in multiple rounds of open public consultation. Third, we always have expert economic and technical consultants on board with us to ensure the technical and economic challenges are provided in the development of the price control or price review. Following our decision, we have mechanisms within the five-year period that track that performance and efficiency against the incentives and reporting requirements we set. These are published annually for all to view and provide feedback on. Even this time around it was mentioned there is an agile investment framework. This allows changes given the changing and acceleration of some national policies around decarbonisation, for example, and how we might achieve that in different ways than might have been predicted at the outset of the price review process. We have allowed flexibility there but there is a transparency and inefficiency challenge around that.

The area of multiple connections is a complex one. There have been examples - I think there was one in Mayo - where two wind farms were being developed and it made more sense to look at a combined, single connection into the major connection point of the grid. In terms of specific cases, there can be multiple developers on different timing tracks for their own projects and they all have the right to access the grid. In the case of multiple types of technologies, they may all be useful at peak periods. Notwithstanding that, we should focus on improving that process and making it more efficient where we have foresight. In the past month and a half the CRU published a paper on renewable energy hubs. This is a pilot which seeks to identify areas of the grid where multiple renewable projects might be serviced by single or more centralised grid connections to make that more efficient case and to align timings with that. We did that with ESB Networks.

Separately and importantly, we are about to publish our first decision of three on hybrid projects. This allows developers to put multiple projects behind a single grid connection more easily and to reduce barriers to that. That could be quite important for isolated and island communities in particular. Where a wind farm and-or a solar farm and-or battery storage would be behind a single constrained connection point, they can still make maximum use of those kilowatt hours because now they can install wind plus solar or wind plus storage. That can make sure more of those kilowatt hours are used locally, decarbonised and in no way wasted, even with a constrained grid. It makes more efficient use of the resource at the site, reducing that need for additional grid requirements, which again leads to cost for others.

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