Mr. Rodney Doyle:

I thank the committee for the opportunity. The clean energy package is a very positive step forward. It is important to say that it is the next step along the journey of the integration of the European electricity market. For that alone, it is to be welcomed. There are some areas that are important to keep an eye on as we move forward with the new package. In and of itself, it is a set of proposals which will now be looked at over time and negotiated. There is the opportunity to look at the proposals and find areas in which we believe we could influence change. That is something that we have the power to do as time goes on. I might concentrate on some of those areas as I look at it.

We have had a very successful single electricity market operating on the island for about the past ten years, as has been mentioned. We are about to implement the next phase of that in the integrated single electricity market. It is more than just the single electricity market. We have had in effect an all-island approach to energy that has been hugely successful for the consumers on both sides of the Border, North and South. It has also gone a little bit unsung in terms of being very successful politically as something that is operated with little hassle on an all-island basis. It is something that we should not lose sight of as we move forward. With that in mind, as we look forward to either Brexit or the clean energy package, we must try to continue that all-island success into the integrated single electricity market.

We must move into that next step and look at the package. Ireland is a unique system. Everyone likes to see themselves as unique, but we are right on the periphery of Europe in many senses, and certainly electrically. From an electricity perspective, we have two interconnections to Britain as things stand. That gives us very important interconnection into Britain and all the way through to Europe, but a limited amount of it. Policies that look solely at central Europe and, either technically or from a market rules perspective, concentrate on central Europe are a bit one-sided from our perspective in terms of how they operate. In looking at the package, it sets out a number of requirements which would see more functions moved to central Europe.

This involves areas such as the role of European Network of Transmission System Operators for Electricity, ENTSOE, which is the European body for transmission system operators, TSOs, similar to ourselves across Europe. It also involves the Agency for the Co-operation of European Regulators, ACER, which is the European regulators' body - similar to the Council of European Energy Regulators, CEER - across the whole of Europe. It looks to strengthen the roles of ACER and set up new bodies known as regional operation centres. While these regional operation centres are good in terms of encouraging co-operation between system operators across Europe, it comes back to that point I am making about the fact that one size does not fit all when operating electricity systems or markets.

This is particularly true when we think about energy sovereignty and our own abilities. As an example, when the IDA looks to introduce foreign direct investment into the country and bring in some new firms, such as some of the big data centres the committee would have heard about recently, a number of our colleagues and ourselves meet the IDA. A big part of the conversation is looking at energy costs and how they are linked to clean energy. In Ireland, we have a great opportunity because we have very clean energy. We also have very reliable energy. Our system has been extremely reliable over time. A large part of that is that we have the capability to make decisions from our perspective in Ireland. Some of the decisions that are proposed to be put out to Europe would be core system security decisions that, from an energy sovereignty point of view, we believe should stay on this island. Again, there are a set of proposals in place currently, but over time it is important to look at those proposals and seek to influence an increase in co-operation across Europe. We do not want to lose some of those key pieces that mean we are able to give investors coming to Ireland the kind of guarantees they are looking for. We are competing against other European countries that are right in the middle of Europe and may have a wider portfolio of solutions available to them than we would, being on the periphery of Europe. It is important for us to look at that.

Then there is the matter of the way in which policies are developed. Central European policies that suit the way in which a market is run in the middle of Europe, for similar reasons, will not necessarily work for us. The influence we have had to date through co-operation with the regulators, the industry in Ireland and in particular the Department of Communications, Climate Action and Environment has been very important because we have been able to take direct control of the drafting of some of the codes that govern how the new market will operate. This role and the way in which we have worked together will be important into the future. Some of the proposals that have been put forward would see more functions moved centrally into Europe, taking away the national regulators, national transmission system operators, TSOs, and national policymakers' influence in the field. Again, we must be careful to get the right mix. To date, we have quite a good balance between co-operation and obligation. I do not want to see this slip the other way and find there are too many obligations with which Ireland, with its particular characteristics, finds it difficult to comply. As mentioned already, the package is very wide-ranging, but we should keep a close eye on the way in which these new institutions will be set in Europe and the responsibilities they will be given as we move forward.

Regarding Brexit, I think it has been mentioned that we believe the new integrated single electricity market, I-SEM, is very important. It is a link between us and Britain and on into Europe. Either way, it is a bilateral market between us and Britain and should be implemented under all circumstances. All our conversations to date with our colleagues in Britain indicate that there is no reason it should not go ahead. Huge benefits are to be gained from increasing the trade between us and Britain for energy customers. With this in mind, we are considering the potential impacts of Britain's exit. These tend to be edge effects in respect of changes to legislation, rules, etc. Anything that would see energy tariffs introduced would be a major negative from our perspective and something we would want to see resisted strongly because it would inhibit the good functioning of the way in which the two markets trade. Further, if Britain is no longer part of the energy market in Europe, we no longer have a direct link into the European energy market in the same way. Therefore, building a direct link to the energy market in Europe is a positive. We in EirGrid have been investigating with our colleagues in Réseau de Transport d'Électricité, RTE, in France, the build-out of the Celtic interconnector, which would link directly from Ireland into the French electricity market. From a Brexit perspective and a wider European energy market perspective, this would be positive. It has been identified as a project of common interest, PCI, in Europe, and it is very good to get that standing.