Oireachtas Joint and Select Committees
Wednesday, 13 November 2019
Joint Oireachtas Committee on Climate Action
Supporting a Just Transition: Discussion
I welcome members and I also welcome viewers who may be watching our proceedings on Oireachtas TV. Before I introduce our guests, I request that members and visitors turn off their mobile phones or put them on flight mode as they interfere with the broadcasting system.
On behalf of the committee, I welcome Mr. Declan Hughes, Ms Céline McHugh, Mr. Joseph Cummins, Ms Áine Maher and Mr. Philip Gallagher from the Department of Business, Enterprise and Innovation, Mr. Jim Scheer and Ms Aileen Duffy from the Sustainable Energy Authority of Ireland, Ms Anna Marie Delaney and Ms Sarah Morgan from the midlands regional transition team - Offaly County Council, and Mr. Padraig Boland from the midlands regional transition team - Laois-Offaly education and training board, ETB.
By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the joint committee. However, if they are directed by it to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise nor make charges against any person, persons, or entity by name or in such a way as to make him, her or it identifiable. Members are reminded of the long-standing ruling of the Chair to the effect that they should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable.
I invite Mr. Hughes to make his opening statement.
Mr. Declan Hughes:
I thank the Chair and the committee for the invitation to attend. The Department of Business, Enterprise and Innovation, together with the enterprise agencies, many of which will be familiar to members, such as Enterprise Ireland, IDA Ireland and Science Foundation Ireland, and the four local enterprise offices in Laois, Longford, Offaly and Westmeath which are under the remit of the Department is deeply engaged in the enterprise development agenda in the midlands.
The importance of this enterprise development work has been brought into sharp focus in the context of the particular vulnerability - and the opportunities - presented by the transition from brown to green in the region, which is the subject of today's discussions. The midlands was hit relatively hard by the recession, which affected all regions, but like the rest of the country it has made a strong recovery. The unemployment rate in the midlands currently stands at 6.6%, compared to the State average of 5.4% so it just over 1% above the national average. That was as of quarter 2 of 2019. This is a vast improvement on the position at the beginning of 2015, when unemployment stood at 14.9%. That was almost 4.5% above the national average at that time. Since quarter 1 of 2015, just under 19,500 jobs were created in the midlands region. That exceeds the target we had set of a 15% increase, as it was about a 17% increase.
It is worth reminding ourselves the midlands has a strong and evolving enterprise base. It has strengths in the food and non-food manufacturing base, which continues to transition from more traditional activities to those driven by technology and digitalisation across sectors, such as medical devices, advanced engineering and an emerging internationally traded services sector. The region has significant tourism assets that can be developed in a more integrated way in the context of the brand experience of Ireland’s Ancient East and Ireland's Hidden Heartlands. The region benefits from a strong institute of technology in Athlone and has unparalleled national interconnectivity, being just over one hour from Galway and Dublin, in addition to having digital connectivity.
On our development agencies, IDA Ireland supports 42 client companies in the midlands, which bring foreign direct investment, FDI, into the region. They employed 5,720 people in 2018. The region was the highest performing region from a job creation perspective across the IDA Ireland regional portfolio in 2018, which is a good base from which to come into the current challenges. FDI employment grew by 13%, with 701 net new jobs in 2018. Recent IDA Ireland announcements for the midlands include: Greenfield Global with 75 jobs in Portlaoise; Leetha Industries and Red Seal Cups with 100 jobs in Longford; Avery Dennison with 200 jobs in Longford; Neueda Technologies with 200 jobs in Westmeath and; SkOUT Secure Intelligence with 30 jobs in Portlaoise. Similarly with Enterprise Ireland and indigenous enterprise, there are over 12,300 people employed in 247 Enterprise Ireland-supported companies in the midlands, which was up by 4% in 2018. Recent announcements there include from Revive Active with 11 jobs in Westmeath and Glanbia with 78 jobs in Portlaoise. That is a €130 million investment into Portlaoise and about 250 jobs will come on stream as part of the construction of that new facility. As for local enterprise offices, LEOs, LEO-supported micro-enterprises added 271 net new jobs across the midlands during 2018.
Despite this positive performance, the midlands now faces a new challenge, which will require renewed efforts to grow alternative sources of employment. The enterprise agencies, namely, IDA Ireland and Enterprise Ireland, the LEOs and other development bodies are fully engaged in this agenda, and are focused on leveraging the key strengths and the potential areas of opportunity for enterprise growth and job creation in the midlands. The Department also has close engagement with the Department of the Taoiseach on just transition and the midlands strategy. Strong cross-governmental co-ordination at the regional level, in partnership with the enterprise sector, is critical at this juncture to focus on the proactive medium to long-term measures, as well as the short-term responses that are necessary to help with the structural adjustment in the midlands region. In this context, the Department of Business, Enterprise and Innovation is leading on the development of the regional enterprise plans, which are successors to the regional action plans for jobs that were initiated in 2014 and 2015.
The regional enterprise plan for the midlands is strongly aligned with and supportive of the work of the regional transition team. Specifically under strategic objective 1 in the plan, it aims to: "Ensure that the Midlands is well positioned to address the challenges posed by the transition to a low carbon economy and renewable energy". The midlands plan had already adopted climate action and just transition as a focus area ahead of the climate action plan and we were drawing from this committee's own report in that context. The climate action plan has since requested that all the regional steering committees adopt just transition as a standing agenda item. The Department worked closely with the agencies, IDA Ireland, Enterprise Ireland and the LEOs, in the preparation of the regional enterprise plan. Reflecting the critical need for a collaborative approach, the midlands plan is overseen by a regional steering committee made up of representatives from the public and private sectors. This includes the enterprise agencies, the local authorities, Athlone Institute of Technology, AIT, the education and training boards - which are here today, Fáilte Ireland; the regional skills forum for the midlands and the enterprise champions. It is chaired by Dr. Anne Cusack, managing director of Critical Healthcare, a leading indigenous business in the region.
All of the regional enterprise plans are working to the 2020 target set under the previous regional action plan for jobs, to deliver a 10 to 15% uplift in employment. That employment focus is at the centre of and will continue to be at the centre of the regional enterprise plans. The midlands steering committee has a number of working groups in place to drive the individual actions in the plan. It will be reporting on its progress to the Minister at the end of this year and the end of next year. The Minister regularly meets the chairs of the regional steering committees, and did so most recently in September, to share experiences and to focus on the evolving situation in the midlands. The delivery of actions under the regional enterprise plans is supported by a specific fund, namely, the regional enterprise development fund, which is administered for the Department by Enterprise Ireland. This fund supports significant collaborative and innovative regional initiatives to help drive enterprise growth and job creation. We have had two calls to date for total funding of €60 million, with which 42 projects have been funded. A third call for €45 million is currently being assessed. To date, the midlands region has secured €3.4 million under the first two calls and some of the initiatives that have been funded include: the Irish Manufacturing Research centre, which is based in Mullingar; Offaly Innovation and Design Centre and I-LOFAR in Birr, which is a significant Science Foundation Ireland and AIT collaborative initiative; the Mountmellick Development Association, which is an enterprise hub in Mountmellick that was opened earlier this year and; a joint Leitrim, Cavan and Longford enterprise hub project. Each region in the midlands under the current call, call 3, stands to benefit from at least €2 million. As I said, those projects should be announced by the end of the year and we understand there are some strong and positive projects from the midlands coming through there. The midlands has also benefited from significant funding, of €13.7 million so far, under the Project Ireland 2040 urban and rural regeneration and development funds, which is important from a place-making perspective, is part of the regional enterprise plans and is part of developing the region as an attractive place for businesses to locate, grow and develop and for people to live and work.
The transition to a low-carbon economy means a new economic model is necessary, focused on low-carbon growth, resource efficiency and sustainable development. That presents significant transformational challenges for enterprise, and is the focus of a dedicated chapter in the Government’s climate action plan, whose purpose is to support enterprises and individuals to make the changes in behaviour necessary to achieve our greenhouse gas emissions targets. The Department of Business, Enterprise and Innovation has a number of specific actions to undertake as part of the Government's climate action plan, including focusing on issues such as decarbonising processes in the cement and food and drinks sectors, which is a major employer in the midlands region, and improving the support available to firms looking to introduce lower carbon technologies. That is an ongoing focus of the agencies. The Department also has a dedicated team that is managing the achievement of the targets assigned to us, while ensuring the interests of enterprise are considered throughout the policymaking and implementation processes across Government. The transition to a low-carbon economy is a central pillar in the Future Jobs Ireland 2019 agenda and similarly will be a key focus in the work we are doing for Future Jobs Ireland 2020. We work closely with the Department of the Taoiseach on that strategy and we had a major session last week on the 2020 plan with over 200 stakeholders. Again, climate action, decarbonising and responding to the brown to green transition were key focuses of those discussions. A key issue in enterprise development and job creation is ensuring we have people with the right skills for what the market is looking for and that we have appropriate supports in place for upskilling and for reskilling, particularly for existing and emerging jobs.
This will not only play a critical role in initiating the transition but also in enabling a just transition. Without a suitably trained workforce, including through upskilling and retraining, the transition will be challenging.
The Department of Business, Enterprise and Innovation is committed to working with its partners across Government and stakeholders, nationally and regionally, to deliver on the potential for enterprise development in the midlands and to deliver a just transition in the face of the current challenge, in particular through opening up opportunities for the affected workers.
Ms Aileen Duffy:
I thank the committee for the opportunity to discuss this important issue. I am accompanied today by my colleague, Mr. Jim Scheer, who is the head of policy insights and design.
The Sustainable Energy Authority of Ireland, SEAI, is Ireland’s national energy authority funded by the Government through the Department of Communications, Climate Action and Environment. Our mission is to help Ireland transition to a low-carbon society, meeting challenging sustainable energy targets along the way. One of SEAI’s core values is that the work we do is people-centred and that we reach, empower and take account of all citizens in the transition away from fossil fuels.
The SEAI’s programmes and supports are designed to take account of the citizen, communities, businesses, individual householders and the vulnerable. However, to achieve reach the ambition detailed in the Government’s recently-published climate action plan, there is to be a sharp acceleration of climate action and the SEAI is highly conscious of the need to be vigilant; that with this positive, albeit challenging, transition that everyone is factored in and no citizen is left behind.
As part of our role, the SEAI provides policy advice and analysis to our parent department, the Department of Communications, Climate Action and Environment. We provided significant inputs to the climate action plan and are very encouraged by the ambition set out with concrete actions, clear timelines and responsible agents. At the same time, we are in no doubt that there are huge challenges ahead with delivering these ambitions, for example retrofitting 500,000 homes to a B2 rating or cost-optimal level. We wholeheartedly welcome the clear acknowledgement by the Government throughout the plan that for this transition to be a success, there is a critical need to understand, include and empower, rather than merely impose. The establishment of the just transition review group within the National Economic and Social Council, NESC, will help to ensure this and we look forward to contributing.
The climate action plan pays particular attention to those groups who will need special support and assistance: those who will suffer job losses or business decline as fossil fuel industries wind down; those who struggle to afford sufficient heat for their homes; and, in general, those in our communities who must be mobilised and empowered to ensure we have the capacity needed to deliver.
As part of our remit, SEAI is already significantly involved in a range of areas that support a just transition. On addressing fuel poverty, SEAI has been running the warmer homes scheme since 2001, upgrading over 140,000 homes of those in, or at risk of, fuel poverty. The scheme has expanded to provide deeper measures in the past 18 months, leading to increased comfort, improved health and on-bill energy savings. A full review of the programme is currently being carried out to see how targeting and impact can be further enhanced. The scheme budget for 2020 has benefitted from carbon tax ring-fencing of €13 million, bringing the total 2020 budget to almost €53 million.
Since 2016, the SEAI has been running a warmth and well-being pilot scheme in collaboration with the HSE. This scheme has targeted over 1,500 homes in fuel poverty where the occupants are suffering from chronic respiratory conditions. The research outcomes on the impact of energy efficiency on occupants' health are highly anticipated in Ireland and internationally. These programmes and their learnings will be critical in ensuring our most vulnerable are protected and included.
The SEAI is taking several actions to contribute to the development of the necessary skills and making the most of supply chain opportunities. For example, we have been involved in the development of a national training specification on near zero energy buildings. This specification is due for publication shortly and, as per the climate plan, will be rolled out at a national level through SOLAS and the Department of Education and Skills.
In 2020, we will review our 2014 supply chain opportunity report, highlighting opportunities for Irish businesses to capture growth in sectors facilitating the transition. With our first experience of delivering retrofit programmes for homes and businesses, we are also advising other organisations. Recently we met the midlands regional transition team, sharing insights from our retrofit programmes. We continue to support Government in our policy advisory role in the areas of energy statistics and modelling, research, design and development and sustainable business and finance model development including one-stop shops and aggregation models.
The SEAI has been working with communities for many years, recognising the importance of grass roots action in delivering our mission. Our community energy network goes from strength to strength, with 320 member communities across the country. We have an ambition to grow this network to 1,500 by 2030. Through this scheme, the SEAI provides supports for communities to identify their own opportunities and create a vision for their local area. We provide funding for development of local energy master plans and technical support via a panel of expert mentors.
Our community capital grants are mobilising action at a local level with around 300 projects delivered to date and a further 57 projects added in 2019. So far, this scheme has delivered sustainable energy upgrades to over 18,000 homes and 2,000 community buildings and businesses across Ireland. Community upgrades of this nature enrol broad cross sections of the community, achieve economies of scale driving down delivery costs, and importantly, generate conversations around the activity delivered at a local level.
The SEAI is committed to deliver as best we can on the ambitions set out in the climate action plan and will continue to put the citizen at the centre of our programmes as we deliver on Government policy goals. We look forward to working with those here today, and others, on this task. We are happy to take questions today focused on our low-income homes support programmes in particular and on other activities in which we are a stakeholder supporting a just transition away from fossil fuels.
Ms Anna Marie Delaney:
I thank the Chairman and the committee for inviting the midlands regional transition team to engage with them this afternoon. I am joined by my colleague, Ms Sarah Morgan, and by Mr. Padraig Boland, the training manager with Laois and Offaly education and training board, ETB, who is also a member of the regional transition team.
I will outline the importance of both peat harvesting and the power stations to the midlands economy and will outline the interventions and activities undertaken by the regional transition team to date. Bord na Móna was established by the Government in the 1940s with a remit to provide employment opportunities in the midlands region. That was a period when there were very few employment opportunities and emigration was a dominant feature of life in the midlands. The remit was to provide employment opportunities and Bord na Móna transformed the economic landscape of the region, with the midlands experiencing in-migration, new settlement and community formation in predominantly rural areas in close proximity to the bogs and the power stations that emerged.
At the height of employment in the 1980s, Bord na Móna and the ESB accounted for some 7,000 jobs in a very sparsely populated and rural region, becoming the mainstay of the midlands economy, providing employment for generations of families and often for many of them, obtaining such employment straight from school.
In October 2015, Bord na Móna signalled end of peat harvesting by 2030, which provided for a 15-year period of transition. A further announcement came in October 2018, with Bord na Móna announcing its brown to green strategy and the acceleration of its decarbonisation programme, indicating that peat harvesting would cease in 2027. In response to this announcement, the midlands regional transition team was established under the auspices of the midlands regional enterprise plan, its membership comprising regional stakeholders. The purposes and objectives for that team, set out at that time, were to pursue funding opportunities and actions to mitigate the impact of the Bord na Móna job losses on the individuals concerned and the impact on the local and regional economy and to position the region to develop alternative forms of employment, attract investment and maximise existing employment opportunities and resources.
In 2018, Bord na Móna employment figures in the region were some 2,000 directly employed with an additional 2,000 indirectly supported. Of those directly employed, some 1,200 were in peat harvesting. Approximately 1,000 of the total directly employed were employed within County Offaly.
Bord na Móna opened its voluntary redundancy programme in October 2018 and close to 500 people will have exited by the end of 2019.
We are a large employer in a rural region and the closure of 21 bogs in that region is deeply felt directly and indirectly.
In October, Bord na Móna brought forward to 2025 its plans to cease peat harvesting and recently reopened its voluntary redundancy programme. Following last Friday's announcement of the closure of two power stations in the midlands at the end of 2020, it is reasonable to assume the 2025 date may be brought forward again.
Since its establishment, the regional transition team has worked in four areas. These are securing special status and designation for Offaly and the midlands region and related funding opportunities, addressing the needs of those offered redundancy and emerging employment opportunities, assess the emerging property and land opportunities that might arise and marketing the region.
Key highlights and achievements in these areas include the acceptance of the midlands into the EU coal regions in transition platform. This will enable the midlands region to avail of the support of a dedicated country team. Technical assistance will be provided under the secretariat's technical assistance to regions in transition, START, programme, with site visits by experts confirmed for December. An holistic plan for just transition for the midlands region will be developed to provide a blueprint for the impacted communities. Another highlight is the recent budget announcement of the midlands just transition fund and midlands deep retrofit programme. We welcome both of these announcements. We have also engaged with NESC, which Ms Duffy mentioned earlier. This engagement has been on the development of a framework for action on transitioning to a low-carbon digital future. Numerous clinics have been held in bog communities to assist those employees impacted by the decarbonisation agenda. A skills, education and jobs fair and idea generation boot camp was held in May in the Mount Lucas training centre. This was very well attended. It targeted casual, seasonal and those full-time Bord na Móna employees exiting under the voluntary redundancy scheme. There was a sectoral focus on manufacturing and construction. It was in partnership with Bord na Móna, the Construction Industry Federation, IDA Ireland, Enterprise Ireland, the local enterprise offices throughout the region, the regional skills forum and the education and training boards.
We have also seen the implementation of the explore initiative for former Bord na Móna staff, which is a programme designed to upskill older employees in manufacturing in areas such as digital skills, personal development and preparation for change. The programme was delivered by the education and training boards following a funding application by the regional skills forum. It was very well received by the participants.
Athlone Institute of Technology and the regional skills forum have been delivering Springboard+ for skills to advance programmes for those leaving Bord na Móna through voluntary redundancy. The education and training boards have developed bespoke courses on skills for those accepting voluntary redundancy. The education and training boards and the Department of Employment Affairs and Social Protection are undertaking on-site skills audits in Blackwater and Mount Dillon with a view to developing bespoke training courses for destination employment sectors. The education and training boards are developing bespoke courses for the nearly zero energy building standard and the deep retrofit programme.
Bord na Móna and Offaly County Council are undertaking a scoping report to examine the possible expansion of the Bord na Mónadiscovery park into an ecotourism destination of national and international significance. We are striving to position the midlands as the low-carbon region of Ireland, retaining its association with energy generation, transitioning to cleaner forms of energy, such as the Lumcloon energy battery energy storage system, the first of its kind in Ireland on a commercial basis. A sod turning event was held in September. There is also the development of Portlaoise as a national low-carbon town model.
A national conference on creating business opportunities from climate change was held on October 9. This is another initiative of the regional transition team. It engaged with the climate action regional office and examined international trends and demonstrated how responses to climate change by business, including within communities, can effectively drive innovation and the adoption of disruptive technologies and can embrace more flexible work practices. There was a panel of expert speakers and the keynote speaker was Dr. Tara Shine.
A midlands network of co-working facilities has recently been established, comprising more than 20 facilities that can provide flexible working solutions. It is exploring opportunities to provide additional enterprise space in impacted bog communities as facilities become vacant. This is delivering on the midlands regional enterprise plan and contributes to Enterprise Ireland's powering the regions policy to provide 600 spaces in the midlands region.
The regional transition team welcomes the Government’s commitment to provide a just transition fund of €11 million, including the €5 million pledged by the ESB. This is targeted at the midlands to support retraining, reskill workers and assist local communities and businesses in the low carbon transition. It also welcomes the additional €5 million for the National Parks and Wildlife Service for bog rehabilitation and the €20 million midlands deep retrofit housing programme. We look forward to receiving more details about these initiatives in the coming weeks.
We welcome the appointment of the first just transition commissioner, Dr. Kieran Mulvey, and we look forward to developing a framework for the region to support our citizens and develop new employment opportunities for the workers impacted by the acceleration of decarbonisation, thereby ensuring a just transition, while also sustaining our rural communities.
In recent years, under the Action Plan for Jobs the midlands experienced employment growth. These hard-earned gains are now under threat. The measures announced in the budget must be supported and reinforced in the years ahead and we as a region ask that the unique challenge faced by the midlands in transitioning to a low-carbon economy is very much to the fore as negotiations commence on the EU budget post 2020.
I thank the witnesses for their presentations and submissions. I will begin with the Department of Business, Enterprise and Innovation. How many meetings has it had with the Department of the Taoiseach in recent months specifically on peat workers and the recommendations of the Oireachtas committee?
What engagement has the Department had with the Department of Finance and the Department with responsibility for climate action on the €6 million just transition fund targeted for the midlands and the establishment of a just transition commissioner?
The Department referenced a lot of what existed previously with regard to regional enterprise plans and ongoing policy initiatives. Entire communities are being adversely affected, as has been mentioned. Will Mr. Hughes outline what new community supports and assistance will be made available by the Department separate to what is already ongoing? It is important to separate the Department's overall remit in the midlands with what is a new development. What is new in recent months?
Mr. Declan Hughes:
It is key to understand that we have stepped up our engagement in the midlands region. We have a specific regional enterprise plan and a steering committee involving all of the stakeholders, including enterprise, wider society, local authorities and education and training boards. They have been asked to put specific focus on the transition and what issues are arising for businesses as well as communities. The Minister has met the chair of the regional enterprise plan, Dr. Anne Cusack, and they have had specific discussions on what additional initiatives can be taken. We are also engaged with the transition team.
Enterprise Ireland is actively engaged with Bord na Móna on assessing areas of opportunities for new business. Some of them are set out in the regional enterprise plan. We had already been considering them. It is not as if this has come as a shock and this could be seen in the strategy earlier in the year. This is stepping up some of that engagement. Particularly in terms of engagement with Bord na Móna, there was a meeting on 23 October between Enterprise Ireland and the senior management team looking at a range of opportunities.
Some of them are set out around the aquaculture side, herb development and the energy side but also looking at the property portfolio and seeing what opportunities that may give rise to in terms of second sites or for other industries to locate. It is a similar situation then with the local enterprise offices in terms of seeing what additional measures they can take. The key thing now is that the skills audit is under way with the education and training boards, and once that is complete, we will then have a sense of the skills that are available in the region, if there is a need for upskilling, if there are entrepreneurial opportunities or opportunities for new business and how effectively we engage with them.
Mr. Declan Hughes:
We were very clear in Monday's announcement when the three Ministers, Deputies Bruton, Donohoe and Madigan, visited the midlands. We heard about 400 jobs being created directly and indirectly to retrofit homes in the midlands, starting with social homes. A total of 100 jobs will be created in the National Parks and Wildlife Service to rehabilitate the bogland. That is committed funding in budget 2020. Bord na Móna will also prioritise job creation. I mentioned the engagement that has taken place with Enterprise Ireland. It envisages 100 new direct jobs and 150 indirect jobs involving the development of renewable energy assets by 2023. There will be 100 new jobs in the new recycling operations and potentially another 150 to 300 new jobs in new green business projects. Real work is being done in developing opportunities and bringing forward jobs.
I also mentioned the work of the IDA and Enterprise Ireland to ensure we have a spotlight on the midlands and that it is an attractive place to bring investment. I mentioned the Glanbia investment in Laois, which is an area that had not got significant investment in a long time. There was an investment of €130 million in a new mozzarella cheese plant last year. That is a significant investment.
I will bank them all and the witnesses can answer what they can. What specific steps has the SEAI taken to ensure the delivery of retrofits for those in social housing and at risk of energy poverty in the first instance? Could the witnesses provide a high-level breakdown of how the €13 million will be specifically allocated? What involvement has the SEAI had with the Department of Housing, Planning and Local Government and the Department of Communications, Climate Action and Environment on the delivery of retrofits in the midlands? When did the discussions commence?
I wish to ask about the 300 loans to households that submitted applications before the deadline for the SEAI's deep retrofit scheme was closed. How many of the 300 households have had their applications progressed and approved?
Ms Aileen Duffy:
I will take the first and the third questions. In terms of the €13 million in carbon tax, that is being put towards the warmer homes scheme. It essentially increased the budget that was in place for 2020. The way the scheme works is that it is demand led and people in fuel poverty apply for it. We deal with the applications on a first come, first served basis. It will enable us to do a greater number of homes. It will get wrapped up in the overall capital budget, which is now at €53 million. There is no specific target for the €13 million but it will help us do more homes.
Regarding the deep retrofit, I do not have an exact number in terms of householders, but applications from anyone who applied before the cut-off date are being evaluated at the moment. We are working through providing letters of offer on those. We have gone back to contractors with some questions as well. We are working through the process as quickly as we can.
Mr. Jim Scheer:
We met the Department of Communications, Climate Action and Environment, the Department of Housing, Planning and Local Government and other stakeholders on the Department of Communications, Climate Action and Environment's high-level housing retrofit task force on 30 September. That was the first meeting of the group to get together and to start to talk about the midlands aggregated housing upgrade scheme, which was one of the agenda items at the meeting. We are waiting for the next date for the group to meet.
I welcome the witnesses to today's meeting. I will concentrate on the midlands regional transition team as I am a Westmeath man myself. While there were plans and the team was working towards 2027, as such, since Friday the date is 2020. What initial communications have the witnesses had from the Departments with regard to funding and changing the outlook?
I would like to hear more from Laois and Offaly Education and Training Board about training. It was mentioned that people who are taking redundancy and who will be unemployed are being put forward for courses. I would like to hear about the age profile of the people the ETB is dealing with, the existing skills they have, and what kind of programmes are envisaged. The commentary suggests that everybody will walk out the gate of Bord na Móna and start retrofitting houses. For someone to retrofit a house at the moment, he or she must be on the approved contractor list. It is not as if it is going to be that easy. I would also like to hear the ETB's opinion on the kind of supports that will be available locally, apart from training individuals or re-employing them, for small and medium-sized businesses that have been supplying Bord na Móna or the ESB. In one conversation I had, somebody mentioned the caterers in Shannonbridge and the people who are supplying them. That is a stand-alone business that will take a serious hit. They are not going to go for retraining. What funds or facilities have been put at the disposal of the ETB to support people like that? The witnesses can answer the questions all together.
From an Offaly perspective, we hear about the funding and the €11 million that has been put in. The ESB and Bord na Móna are possibly the two biggest ratepayers to Offaly County Council. When one takes one from the other or adds one to the other, how is the council fixed financially? It is great to hear about all the money it is getting, but what will it lose when it balances its books at the end of the year? Will it be able to fund the personnel, facilities and programmes it needs to carry out?
The witnesses can answer this as briefly as possible. We are all aware in the midlands, Westmeath, Longford, Offaly and Laois that the majority of people in Bord na Móna were seasonal workers who were farmers. They worked part time in Bord na Móna and they were part-time farmers. One income supplemented, more so than complemented, the other. What interaction has there been with the farm agencies? We all know the situation with farming. That is for a different committee and I will not go into it now, but there are people who are facing a double whammy who are possibly not employable on a full-time basis because of that situation. How will that scenario be addressed?
Ms Anna Marie Delaney:
On the announcement last Friday about 2020, we had expected that there would be a 15-year transition period and we were talking about 2030 initially. Peat harvesting is finishing now at the end of 2020, so we really have 13 months to try to transition, and that is a challenge. It is to be hoped the Government funding supports that have been put in place under budget 2020 and the just transition fund will provide some of the supports to the SMEs that will assist with the transition period that we have.
Regarding the supports to business itself, our local enterprise offices are engaging with the various agencies about community supports. In addition, in terms of job creation opportunities, the local authority would be facilitating that role through our local enterprise offices across the region. All of them are engaged in it, as well as the business support units that we have and also through our local development companies to try to develop social enterprise in some of those areas. We would expect that the just transition fund would assist with a number of the supports and that the just transition commissioner would assist and engage with us on how that might be rolled out and how it might work. We are waiting to get some details on that. The commissioner was just announced on Friday. We have invited him to our next meeting of the transition team.
With regard to the rates base for the local authorities, it is a very significant hit for both Offaly and Longford county councils.
The Shannonbridge station pays Offaly County Council €2.8 million per annum in rates. The loss of that will be a significant hit to the services and supports in the area. We will engage with the commissioner and the Department about the supports and resources that may need to be put in place. The Lough Ree station in Lanesborough is worth €1.2 million in rates to Longford County Council. Losing that will also be a significant hit to the council's books. We will engage in the same process there and through the transition team. I will now ask Mr. Boland to comment on training and reskilling.
Mr. Padraig Boland:
On training and the skills base, we have been engaging with Bord na Móna workers via workshop information and advice clinics. We started these last February when news of the strategy to 2028 first broke. Those workshops and clinics are ongoing. Th process has been ratcheted up a bit. This week, for example, the education and training boards, ETBs, are in Mount Dillion. These are the Galway-Roscommon ETB, the Laois-Offaly ETB and the Longford-Westmeath ETB, along with our colleagues from Athlone Institute of Technology and the regional skills forum. The ETBs are taking the lead in each case. We have been advising people broadly and we are trying to get engagement.
We are cognisant that many of these workers have been out of an education or training setting for a long time. We need to help them identify the skills they may have gained over the years. Many may have got jobs with Bord na Móna straight from school. While thinking they had jobs for life, they now have this foisted upon them. I am thinking in particular of last Friday when we happened to be in Blackwater when, unfortunately, the news broke about Shannonbridge. These workers have had to deal with the shock element. We have engaged experts in career guidance. We are looking to perform skills audits of those workers and carry out a training needs analysis for how to develop career pathways. These are new, bespoke programmes and are additional to those accommodating the 11,000 learners we have in the further education and training sector in Laois and Offaly. These Bord na Móna workers are not the 1,000 people we have already moved directly into employment from our other employment engagement programmes in the last year in Laois and Offaly. This is in addition to that.
Two programmes are funded by SOLAS nationally. The Skills to Advance programme is primarily focused on upskilling employees who are already in a workforce. The other programme involves traineeships that can be developed. It is based on the apprenticeship model, alternance training and work placement. It is a flexible approach to upskilling people. This can be focused at employed and unemployed people.
It is a little premature to answer the Senator's question without the skills audit being completed. We have been looking for this for a long time. It started with the workers in Mount Dillion on Monday. All of the ETBs have had staff in Mount Dillion for the week. They will then move to Blackwater on Monday next and we will start there. When we have the skills audit we will marry it with a study of the skills gaps - as undertaken by Mr. John Costello and the regional skills forum - and then work with the rest of the transition team. There will be bespoke training programmes.
I thank our guests. I have a few questions, the first of which is for Mr. Hughes. How does he see the interplay between the objectives of a just transition and balanced regional development, especially with regard to Project Ireland 2040? This is in the context of the regional enterprise strategies where we are trying to drive investment and growth into the regions and out of the bigger urban centres.
I will now go through the other questions, which are related. With regard to policy around data centres, I am aware there are energy guzzlers. Does the Department have any green energy requirements for data centres that IDA Ireland, Enterprise Ireland or whoever might support? This is aside from the commitments to green energy for data centres and declarations made publicly by some of the tech companies. Is there a policy to drive the development of data centres outside the greater Dublin area? How is the Department getting on with that? What is IDA Ireland actively doing in this regard? What are the successes in this area? It is an issue I am familiar with and I will give an example. In north Mayo the former Asahi site has had planning permission, granted for a several years, for a data centre. A high-speed fibre technology cable is coming from North America to there. It is a break-out point and there is a planning application for a combined heat and power high-efficiency biomass plant. Yet, they cannot seem to get a data centre there. It is a brownfield site and appears to tick all the boxes, but nothing has happened. It is a puzzle as to why this is the case. What are the Department and its agencies doing about this?
Mr. Declan Hughes:
I thank the Senator for her questions. At the heart of the regional enterprise plan for 2020 is just transition and responding to challenges and opportunities relating to climate change. It is also at the heart of our national enterprise policy and is one of the key pillars of our future jobs strategy for the next five to ten years in repositioning the economy. We are approaching full employment but we are very conscious that, in the context of those jobs, we need businesses to be resilient and workers that are resilient. We have to respond to the opportunities that are there in the context of moving from brown to green and encouraging sustainable development.
Our enterprise agencies are very focused on the opportunities around new sectors and new areas of activity be they in engineering or food production. We have a specific target to reduce carbon emissions in the food sector by 10% to 15% over the period to 2030 and we will work on that. A key part of this will be working to ensure that we sustain jobs in the regions and that we upskill the workers in the regions and therefore we have the regional enterprise development fund. This €60 million regional fund supports bottom-up projects and collaborative projects across the regions, with a minimum allocation of €2 million for each region. As already stated, this has been successful as part of Project Ireland 2040. It is a new initiative but it sits alongside the Project Ireland 2040 rural funds and the urban development funds. The climate action fund is also part of that. There is a joined-up approach with the regional enterprise plans in networking with the transition team in the midlands and ensuring we can achieve balanced regional development, as referred to by the Senator. It is also about ensuring that every region achieves its potential. This means we must have significant investment into the regions, property programmes for IDA Ireland with additional site visits, and work with the institutes of technology and the universities in the regions to ensure there are attractive places to live and work as well as having property solutions.
In addition to regional enterprise funds, we have had a call from the LEOs for capacity-building at local level. This is additional funding. Of the €2.5 million that was competitively offered across the LEOs in the autumn, the midlands won €750,000, which is nearly 30%. One project in particular, Going Green, was awarded €220,000 to educate, advise and support small businesses in the midlands region in their adoption of environmentally positive actions and helping their move to improving their green credentials. There was also a project on ingenuity engineering. A third project awarded funding in the initiative was specifically around increasing the number of first-time exporters from the region. Key to ensuring the sustainability and resilience of businesses is that they diversify their markets and look at new opportunities, and internationally especially. That project was awarded €150,000. As in other regions, it will bring on new exporters.
Project Ireland 2040, together with the regional enterprise plans are very aligned in their funding and capacity building capability. Through the regional enterprise plans at local level the agencies such as IDA Ireland, Enterprise Ireland and the LEOs are working with the local authorities. Those initiatives are led by industry champions. It is very much attuned to the business view on what the opportunities are and realising those.
On data centres, we did work with the Department of the Taoiseach and in July 2018 there was a Government statement on the role of data centres in Ireland's enterprise strategy.
This set out clearly the focus on looking for locations outside of Dublin and on aligning those with locations that have energy and connectivity infrastructure, specifically, as the Deputy mentioned, high-speed data lines and telecommunications capacity. IDA Ireland and Enterprise Ireland are continuously engaging with investors to see where there may be opportunities. I do not have the detail on the specific site the Deputy mentioned.
Mr. Declan Hughes:
The questions that then arise are what are the gaps and why is the site not attractive. We will certainly be happy to engage with the Senator on the matter.
We know from all of our engagements through Enterprise Ireland and IDA Ireland, as well as directly, that data centre owners and operators are very focused on the use and development of renewable energy sources. In some cases, they are investing significantly in renewable energy sources to improve their green credentials. It is also an important part of our own grid development and ensuring we have usage for electricity from renewable sources at off-peak times. There are other technologies that can be used. A mix of solar, battery and other technologies will optimise our grid.
IDA Ireland also works with clients seeking to support an increase in renewable and green activity. Its Go Green initiative includes data centres to enable them to improve their green credentials and investments. Many multinationals are at advanced stages of investing in energy efficient data management and optimising their own systems.
From an Enterprise Ireland perspective, a key focus of its involvement with large companies is energy investment and energy efficiency retrofitting in many cases, whether it is combined heat and power, CHP, or other forms of energy usage. That is what the market and consumers are demanding and we are very much behind that. If we can support that investment, particularly in major employers in the regions, that will improve their competitiveness and sustainability in the long term to sustain jobs in the regions, particularly in the food and drinks sector, a key employer in rural and regional locations.
On the European Globalisation Adjustment Fund, has research been done or are there any developments in that regard? Anderson Ireland in Rathkeale, where I am from, closed in 2014, and ProCad, a design company, has moved in to the area since then. Many of the workers in Anderson Ireland have retrained and found employment, which is very welcome.
Has any sort of analysis been done on the demographic of workers who may be affected by this? This goes back to something that I champion, having a background in recruitment. I refer to people trying to find sustainable employment after losing their jobs or being out of work for ten, 15 or 20 years. They may be trained in different skills but it can be difficult finding a job, particularly for those aged between 50 and 55. They often experience covert discrimination when looking for work. Has the Department looked at ways to combat that, with specific emphasis on traditional industries where people may be in jobs or roles for a large part of their career, through no fault of their own. They face difficulties afterwards and I know from my experience in recruitment that the problem is rife.
Mr. Declan Hughes:
I thank the Deputy for the question. In other contexts, not just in this context, the European Globalisation Adjustment Fund is very much at the centre of the considerations of the Departments of Business, Enterprise and Innovation, Employment Affairs and Social Protection and Education and Skills. The Department of Education and Skills has responsibility for liaising with the EU and has well established processes for drawing down funds from and engaging with the European Globalisation Adjustment Fund. We understand that the Department is progressing the matter in this case. This would provide support for training. It is also some advantages with regard to the types of training that can be funded, the allowances, etc. I do not think there will be any particular issue in ensuring that is available. It is part of the suite of supports that is being considered.
To respond to the Deputy's point about workers, the key concern is around demographics and skills. There are some headline figures on the skills and age profile of the different cohorts. Mr. Boland mentioned the work being done by the education and training boards, where they meet the affected workers and engage with them on their age profiles, skills, the areas in which they have been involved and their experience. Not everything comes down to a specific qualification. Somebody who has spent 15, 20, 30 or 40 years in an employment may have a key set of skills. Our agencies make an input into the regional skills forum, which is also led by the Department of Educational and Skills, by identifying where the jobs, skill needs and opportunities are and providing information on the supply side.
Obviously, the workers affected by the decisions by Bord na Móna and the ESB will form part of that assessment to identify if there are opportunities available for them across a range of sectors. Some of the 1,050 job opportunities announced on Monday, whether in retrofitting bogs or other areas, will have certain skill demands. Some of the investments on the construction side will also have demand for certain skills. In two or three weeks, the work of the education and training board will be complete and this will feed into the assessment by the agencies with the regional skills group. From there, we will be able to see what additional retraining is needed.
On the education and training boards, people who would have done hard physical work for years are physically not able to continue the work for which they are qualified or have experience in. Have the training bodies done any studies on how to help people diversify their skills? I have in mind people who were used to doing the same type of work and are not academically focused. Has work been done on transitioning people from physical work to more intellectual-type roles, for want of a better term?
Mr. Padraig Boland:
We are beginning that work and part of it involves the EXPLORE programme, which deals with digital skills and is focused primarily on the exact demographic the Deputy is talking about. We are discussing a redundancy scheme here. The first group who applied for the voluntary redundancy scheme were in the older age cohort. We have been exploring areas that might enhance the quality of life of individuals. This can involve looking at part-time employment options in healthcare and social care that they may not have considered previously and where they have garnered skills. Much of this is done through engagement and sitting down with people to talk through and identify skills they may not realise they have. Some of those skills may have been attained through voluntary or other work. Many may feel they cannot take up employment or may not be offered employment in the areas in which they have traditionally worked. We are trying to transition that. It is a slow and ongoing process.
I welcome our guests. This is a very important subject. As the CEO of the county council, Ms Delaney, said, 15 years have been being compressed into a few years and we are racing to catch up.
I will keep my questions short and I ask the witnesses to keep their replies short because time is limited. Funding of €20 million has been announced for retrofitting. Will Mr. Scheer indicate the potential number of retrofits that may be needed in the four midland counties?
My other question also relates to retrofitting and is for the ETB. The skilled labour required for retrofitting includes plasterers, plumbers, electricians, window fitters and so on. What survey has been done to assess that? Is the ETB planning on running short courses or apprenticeships since, for instance, plumbers are trained over four years, as are plasterers?
Mr. Jim Scheer:
There are Government national targets for the 500,000 to a B2 or cost-optimal level. As far as drilling those numbers down regionally, I do not have those numbers to hand but they can be estimated. The SEAI launched a building energy rating map recently that shows at small area level, that is, groups of 50 to 100 homes around the country, the distribution of the building energy ratings from A to G for each of the small area codes. That could be used to build up a picture of the quality of the building stock by region. We could provide that to the committee if we are specifically requested to do so. We also have details of where the grants are being drawn down by county, and they are available.
Mr. Padraig Boland:
We have been in discussions with SOLAS, which has agreed that Laois and Offaly ETB will host nearly zero energy building, NZEB, and retrofitting programmes at Mount Lucas. That agreement has been put in place. The Deputy is correct in identifying that the multiplicity of skill sets required needs a level of craftsmanship that would require a four-year apprenticeship. Bord na Móna would have some employees who are fully qualified craftpersons. There is an initial NZEB training centre in Ireland with Waterford and Wexford ETB in a training facility in Enniscorthy. We will replicate that. Those programmes are primarily upskilling current craftspeople, such as plumbers, electricians etc., to bring a building to NZEB standard. One element of it is for general operatives, which might be suitable to those who do not have the full craft.
Another area that we are looking at and on which we have engaged with Waterford and Wexford ETB, SOLAS and external expertise is the development of a programme that would give a qualification to people to undertake the work to deep retrofit and looking at a programme that would be bespoke to the housing stock in the midlands. That is only in its very early stages.
Retrofitting has been flagged as a large part of the just transition. A sum of €20 million was announced for it this week. I calculate that at €40,000 per house, and it could cost much more for some houses, it would deep retrofit 500 homes. Will the SEAI comment on that?
I am glad to hear that Mount Lucas will be the centre of the universe and Laois and Offaly ETB is in the middle of it. It has done a lot of work with training and upskilling people.
Ms Delaney from the county council might answer my next question on the rewetting of bogs. The carbon sinks are an important use. We must regenerate those carbon sinks and rewet the bogs. Is the council looking at any other use? There can only be so many Lough Booras and tourist attractions, and I have been down to Lough Boora several times. Is there any other purpose for those bogs, economic or otherwise?
Another question for Ms Delaney relates to Laois and Coolnamona. There has been no just transition whatever in Laois. I do not know if anyone from Laois is on the transition team. I worked on it, and there were up to 300 of us there at one time. We knew it would come to an end some day, and that has accelerated, but there are still workers there, and many have lost their jobs in recent years. Will Coolnamona be included?
We have argued for years that we need to create a biomass supply chain. Even if only Edenderry is left, although I think the other two power stations should be left standing and brought back into use for 100% biomass, because when there is no sun shining and no wind blowing, we will need dispatchable power, as we cannot just rely on nuclear power from England the whole time, are there any moves afoot to put in place a substantial supply chain of biomass?
Mr. Jim Scheer:
The €20 million that will go to the aggregated housing upgrade scheme will be funnelled through the Department of Housing, Planning and Local Government rather than the Department of Communications, Climate Action and Environment. We are working with the Department on the high-level task force that will determine the eventual design of that scheme and how exactly it will be rolled out. That is not yet finalised. The Deputy's estimates on the basis of a deep retrofit, which we would consider bringing a house into the A range, are not necessarily the target for that scheme. It is set in line with the current 2030 target for the 500,000 homes to a B2 or cost-optimal level. Our modelling suggests that those homes do not cost into the €40,000 to €60,000 range but are more in the €20,000 to €25,000 for an upgrade.
Mr. Jim Scheer:
Yes, in terms of the straight arithmetic, that checks out completely. There is also discussion on how to best leverage that money in terms of the aggregation model. It is hoped that we would achieve some economies of scale by that direct targeting in local areas and building up the numbers. Where the money is spent, private homes would be invited into that model. They could also leverage funds through the SEAI grant programmes, which would build a bigger pot of homes to be done. All those issues are being fleshed out now.
Ms Anna Marie Delaney:
The rewetting of the bogs and the carbon sinks is an item for Bord na Móna itself. It has mentioned it as one of the possibilities of some of its boglands. We have engaged with Bord na Móna on the new business opportunities and the alternative uses for the landbanks and the vacant workshops. Mr. Hughes also mentioned IDA Ireland advising on those. The holistic programme that is to be prepared under the EU STARTS programme is also given the remit of exploring alternative uses for landbanks and the vacant workshops for community gain. That would not just be tourism opportunities but might also be enterprise hubs and similar initiatives.
On biomass, An Bord Pleanála's decision really impacts this. Edenderry is co-fired by peat and biomass and has permission for this until the end of 2023. After that the options will have to be considered. Bord na Móna is exploring new opportunities in relation to various pilot programmes, such as aquaculture, birch water harvesting, herb farming programmes, and renewables. It will be coming before the committee next week and may address some of those issues in more detail. We do engage with Bord na Móna very significantly on landbanks and its various initiatives, and some of those pilots are based at Mount Lucas.
I have five minutes, so to make best use of it I will put the questions to specific witnesses. I will start with the Department. Has there been an audit of how many jobs are at risk or where there is a need for a transition from what someone is doing to something else as a consequence of moving away from carbon, both in the public and private sector?
We are examining the issue of a just transition and supports such as retraining, upskilling, new job opportunities and so on for those who are affected. If the starting point is that we do not have a number or that we do not know exactly how many jobs are at risk, not least in the public sector, how are we to plan for all those workers? Obviously, in the case of some workers, there are immediate threats. It is a bit poor if the starting point is that we do not know the number. Is it that Mr. Hughes does not have the number to hand or that the data have not been compiled?
Mr. Declan Hughes:
I do not have the number with me. We are working on the specifics of the Bord na Móna and ESB numbers, for which we will have to ensure we quantify the impact on those workers to identify where there are retraining or alternative employment opportunities, and that the investment is made to make that happen-----
Many jobs are at risk. Approximately 1,000 are at risk at Bord na Móna, and while we know about them, there are many more. Mr. Hughes might send us a note on what work is being done to estimate the scale of the challenge. Once we understand the scale of the challenge, we can hold to account the Department and others in respect of the responses put in place. We will need a bit more than what we have heard today from Mr. Hughes on the scale of the challenge. We will need hard facts, for both the public and private sectors, on what jobs are at risk and the level of transition that will need to happen.
Mr. Declan Hughes:
We can certainly give the Deputy that information. I should say, however, that a range of work has previously been done on the green economy. The expert group has examined the matter and a number of reports over the years have continually quantified the sectors and jobs at risk. The agencies and others have stepped in to ensure that the investment will be made to support the jobs and help the sectors with the transition.
There are always jobs at risk. The food and drink industry, for example, is under continuous pressure in respect of sustainability credentials and so on, and it is now making those investments. In the dairy processing sector, €800 million was invested last year to protect and grow jobs. Much of that investment is to enhance energy efficiency and productivity. We continually focus on such jobs, and in the context of full employment, that has to be the main focus. Between 5% and 10% of jobs will probably always be at risk. It can be seen in the case of our enterprise agencies. There is a continual churn and we continually work with affected sectors-----
In that lengthy response, Mr. Hughes spoke about work done in the past, such as previous research, studies and reports. My simple question was about the global figure, but Mr. Hughes could not answer it.
Mr. Declan Hughes:
We are focused on the existing at-risk jobs at Bord na Móna and ESB, which have to be a priority. We are also carrying out research with the expert group on future skill needs, which examines the green economy in respect of both the opportunities and the threats. The report will be available in quarter 2 next year, and we will ensure the committee receives a copy of it.
I turn to the SEAI. Mr. Hughes responded to Deputy Stanley on the €20 million made available for retrofitting. Mr. Hughes indicated it would not be the deep retrofit done in previous programmes but rather that approximately 1,000 houses will be done. He stated the details of the scheme are still being worked out. Is the retrofit still at concept stage?
Mr. Jim Scheer:
We in the SEAI have delivered a number of programmes on behalf of the Government for a number of years, and this is a new bucket of money for a different programme, under a different heading, and targeted at a specific area. It is new. To date, our schemes have generally been open to all comers from throughout the country. A number of community grant schemes and so on have taken place in specific areas, but never before has there been a dedicated bucket of money for a specific area.
For the €20 million, are there details of the scheme, such as the average cost, the types of homes being considered, whether there will be equality and fairness, whether households will need to have some of their own capital, and if that is the case, how that will work out for a low-income family? Have such details yet been worked out?
Mr. Jim Scheer:
That is a matter for the retrofit task force via the Department of Communications, Climate Action and Environment. The Department of Housing, Planning and Local Government will deliver it through its existing local authority scheme. That is the mechanism already in place, and the €20 million is an increment of the scheme, which is already doing work in local authorities.
It was clear from Bord na Móna announcements in the first half of the year that there would be a major need for redeployment of staff. Why then did we have to wait until last Monday for the skills audit to start at Mountdillon? Mountdillon and Blackwater have been named but when will the audit happen at the 15 other Bord na Móna sites? What specific steps are being taken by the SEAI to recruit local retrofit contractors in the midland peat counties, which also include counties Galway and Roscommon, to capitalise on the €20 million retrofit plan?
Mr. Padraig Boland:
We are an ETB and the employees are not ours. We were given access for a skills audit from last Monday. I cannot answer the Deputy's other question. We have engagement with Bord na Móna, and the level of access to employees has recently improved dramatically. Previously, we had access only to those employees who had taken each voluntary redundancy package as it became available. That previous process is why the audit started only on Monday at Mountdillon. There is also Derrygreenagh, for example. Several more sites will come on stream and we will need access to them.
Mr. Jim Scheer:
We do not do specific recruitment in local areas of contractors. Our role as the national energy agency is to set the standards for retrofits. We are clear that if a Government grant is taken, the house must be upgraded to a particular standard. We issued those standards and maintain a list of registered installers, as has been mentioned. We also set the qualification levels for the skills and have a list on our website of accredited training bodies throughout the country. I do not know whether any of the training bodies are in the areas the Deputy mentioned, although there is a list on our website.
I thank our guests for their presentations. I attended a briefing this morning at the Nevin Economic Research Institute. It was pointed out that the midlands is in a poor position to adopt private capital and that it has the lowest rate of foreign direct investment in the country. A strong case was made for the State to take the initiative to mobilise public intervention and public investment in areas such as the midlands. Does Mr. Hughes agree with that conclusion?
Mr. Declan Hughes:
I attended a different meeting this morning and, therefore, I have not caught up with the briefing the Deputy mentioned. We are conscious of the need for asymmetric or special support for regions that were lacking, not least in the case of the midlands. In recent years, there has been a specific focus on additional investment. For example, in the midlands, there have been advanced technology construction and investment in Athlone, through the IDA property programme-----
With respect, that is outlined in Mr. Hughes's submission and I am conscious of time. It jumped out at me that he stated there are big data opportunities. I do not know whether he watched Philip Boucher-Hayes's report last night on the plan to create multiple data centres in various parts of the country and the fact that they will eventually use one third of all our electricity needs. Does that not fly in the face of the policy objective of meeting our climate targets, notwithstanding economic growth?
The Department is trying to do two things, but the climate objective is being undermined.
Mr. Declan Hughes:
I might clarify. The focus in the midlands on big data and data analytics is specifically around data management. A significant investment has been made in the Irish low frequency array, I-LOFAR, at Birr Castle. It is a radio receiver that is linked to the Athlone Institute of Technology.
Mr. Declan Hughes:
It is meant for the underlying science and research and for developing the skills base for industries in ICT, which spills over into medical devices, engineering jobs, etc. That will underpin the future resilience of the region by attracting new investment. If we have significant new initiatives like that in the region, it is a magnet for investors who like what is happening there. The midlands have many key strengths, particularly Athlone Institute of Technology-----
This is gobbling up my time. I just want the factual answers. Mr. Hughes stated that the EGF is the business of the Department of Education and Skills because it was to that area that the money was dedicated.
I do not believe that is true. In the north of Spain, a large chunk of the fund went to redundancies and support for workers. This morning, the Nevin Economic Research Institute, NERI, stated that most of the fund was for redundancies.
Mr. Declan Hughes:
For an EU fund, someone has to make the application. The Department of Education and Skills is the liaison and co-ordination body in Ireland. It works closely with us and the Department of Employment Affairs and Social Protection on capturing the data on those who are impacted by job losses, redundancies or structural changes. What we are discussing is obviously a significant structural change for the people affected. Their training needs can be tracked and supported. The Department of Education and Skills, which is the training provider through the ETBs, compiles the submission. Someone has to be responsible, but it is not that Department on its own. This is a joint co-ordinated approach across the three Departments.
In a region that has taken such a blow to jobs, one would have imagined that the Minister for Communications, Climate Action and Environment would have been the co-ordinator when seeking funding from Europe to support the workers who are losing their jobs.
I would like to ask further questions. I am puzzled by the budget that has been dedicated to the SEAI - €53 million next year, including an extra €13 million from carbon tax ring-fencing. It was mentioned that €20 million would be dedicated to a specific retrofitting project. Is that the same €20 million that is going to the midlands?
Mr. Jim Scheer:
The €20 million for the midlands will be administered through the Department of Housing, Planning and Local Government, not the SEAI. Our involvement is as part of a high-level housing retrofit task force convened by the Department of Communications, Climate Action and Environment, which the Department of Housing, Planning and Local Government is also on, to add our expertise on how that might be delivered. I understand that the Department of Housing, Planning and Local Government already has a €30 million fund for upgrading local authority housing. It will be augmented by the €20 million. The energy parts of the upgrades that are occurring through that scheme will be enhanced to the B2 level.
Ms Aileen Duffy:
The €53 million is specifically for the warmer homes scheme, which is a nationwide scheme and does not target the midlands. Some €13 million of that €53 million is from the carbon tax. All of the €53 million will go to the warmer homes scheme. It is separate from anything to do with the project in the midlands.
I have met the SEAI previously. I have many problems with the way people are supported. There are many sick, old and needy people who do not fall under the SEAI's remit.
My final question is for the midlands regional transition team. Its delegates referred to addressing the needs of those offered redundancy and emerging employment opportunities. How many of those made redundant have come to the delegates' organisations and how many have they dealt with? Is it the majority of those affected, all of them or half? The delegates also mentioned that, in the beginning, older workers were receiving access to the voluntary redundancy scheme. Does that mean that they have not been able to access it recently? The evidence I have is that workers of more than 61 or 62 years of age are not being allowed into the scheme because Bord na Móna can hold onto them for the few years they have left instead of paying them redundancy.
I would like the delegates to comment on something else that was mentioned this morning. In highlighting the nature of employment that has followed on from the cessation of peat production, the Littleton briquette factory in Tipperary was used as an example. It is instructive. Following the loss of 124 Bord na Móna jobs in Littleton, the factory is now a plastic recycling plant staffed by workers on one-year contracts earning barely more than the minimum wage. Would the delegates like to comment on that? Do they view that as the future for Bord na Móna workers in the best possible sense? They have jobs, but they certainly have nothing like the terms and conditions that they enjoyed previously or from which their communities have thrived.
Mr. Padraig Boland:
I might take the first two questions, which are within the remit of the ETB. No one came to us - we went out to the workshops. In most cases, 80% plus of workers who have taken the voluntary redundancy package participate in our programmes. I have not heard the narrative of older people no longer being given redundancy, but it is not borne out by what we are meeting on the ground. We had 95 people last Friday morning in Blackwater and a further 45 in the afternoon. The age profile was varied and included many older people.
I thank our guests for their contributions. As a recent member of Offaly County Council, this was an issue that we discussed inside and outside the chamber. I live in north Offaly, which is very much in the heartland of these issues. The job losses from the peat and energy generation sectors are catastrophic for the area. If similar levels of jobs were to be lost in a tech centre in Dublin, the country would be in meltdown. Unfortunately, I do not get that sense of urgency generally about these losses.
While the figures on job creation in the midlands over the past decade have been positive, I would argue that some parts of Offaly and the wider midlands never came out of the recession. The exodus of commuters from towns like Edenderry and Portarlington is vast. They are all travelling to Dublin for their jobs. The midlands face unique challenges, but we must look to and learn from the countries and regions that have transitioned successfully. We must also learn from the mistakes of other areas that have not done this well.
We obviously really need to fast-track this. We are down to months and years at this stage. If we do not get this right, we are going to run the risk of turning the midlands into the rust belt of Ireland. I would like to address a couple of questions to the midlands transition team, probably to Ms Delaney. Does she feel that the challenges faced with adopting a just transition from a local authority perspective would be facilitated in some way with some local government reform? As Ms Delaney will be well aware, we are one of the most poorly funded and supported local governments in Europe. If so, what provisions does she think should be put in place or what type of reform would she consider necessary? It may have been answered already and apologies if it has, but I would be interested to know the age profile across the board for the Bord na Móna and ESB workers and also the age profile of the 500 people who will have exited by 2019 through the voluntary redundancy option since 2018.
I never get a figure from the Department of Business, Enterprise and Innovation of the number of jobs created from aquaculture and herbs and all of these developments within the Bord na Móna lands at present. If the Department could provide that that would be great. Also, have there been any discussions within the Department regarding the cessation of peat extraction for horticultural purposes? That is a vast amount which has an environmental impact both in terms of peat and carbon loss.
Mr. Declan Hughes:
I think they have 100 jobs in new recycling operations and then somewhere between 150 and 300 new jobs in wider green business projects. We are in discussions with some of them through Enterprise Ireland on how they can be taken forward, so there are some interesting proposals. One will see them in the plan there around acquaculture and herbs and the energy park and I know they are looking at some other ones as well. They have a very good asset base, and the issue is how we can develop products which would meet markets. Certainly there is demand for some of those products and, climatically, we are good in terms of potential for growing them as well and we have that asset base.
On the more general issues around the horticultural extraction, I do not have the detail on that but I would say more generally there are always opportunities. If there are opportunities for alternative uses or alternative products etc., Enterprise Ireland, EI, and the local enterprise offices are available to work with entrepreneurs locally. It is something EI will be working with, similarly through the Education and Training Boards, ETBs, with individuals to see if are there business opportunities which they might take forward if they were replacing existing products or developing new products.
Ms Anna Marie Delaney:
First, on the commuters issue that Senator Hackett mentioned, I mentioned earlier the midlands network of co-working facilities that has been established. That is to provide hot-desking to enable one or two days a week working within the local region for people who might be commuting; it is an opportunity and we are linking in with a number of companies in Dublin to try to facilitate that process. The age profile in our experience to date and the information that we have is mixed, but Bord na Móna might be better placed to give that full information to us. That is something to perhaps ask them next week as well; that will be a challenge as for the local just transition commissioner and the fund.
On our own financial position and the financial position of a number of counties in the midlands region, I would recommend a review of the local government reforms for finance. We have not had an increase in the Local Government Fund since 2014. The impact of the rates base there and the hit from the Shannonbridge closure will certainly warrant a full review of the services within our own local authority area. We would be engaging with the Department and the just transition commissioner on the supply of resources and supports to the area. In the midlands region, the local authorities are all represented including Roscommon and Kildare. It is not just the midlands counties that are represented on the regional transition team. We have expanded to the other areas as well. The agencies have been working very significantly on reskilling and retraining together with Athlone IT, the regional skills forum and the ETBs across the region. The Department of Employment Affairs and Social Protection has also been very engaged on outreach to workers on reskilling and retraining and have provided tremendous support across the board.
To follow up with on Senator Hackett was saying, and anyone could answer this, I do not know if anyone saw the presentation here two weeks ago in advance of this meeting on the issue of peatlands re-wetting. Did anyone see the presentation made about that? An academic from UCD, Dr. Florence Renou-Wilson made, to my mind, a brilliant, really significant submission showing that peatland emissions account for 11 million tonnes, which is the equivalent of our entire energy emissions. I do not know if anyone saw the RTÉ programme, "Hot Air", last night. I thought it was really good. When they were doing this calculation figure, 60 million tonnes, horticulture peat extraction and industrial peat extraction accounts for 5 million tonnes, and I just put it to the committee that it seems to me that we should be really honest with communities here that the likelihood of horticultural peat extraction continuing is very slim, and Dr. Renou-Wilson from UCD when asked for advice said it was clear we will be stopping all peat extraction. Has anyone countenanced that within the work that is going on?
Mr. Padraig Boland:
Deputy Ryan has mentioned the word "communities". I am of this community as well as working with the community. A just transition that focuses solely on the employees is missing missing a lot in terms of the sustainability of rural communities and being honest with these communities as they face the future. One of the difficulties for rural communities, including the employees, is that this has been a long, drawn-out process. It is currently in the name of climate change, but this started in 1999 with the loss of a cooling tower in the ESB in Ferbane, and the redirection of Bord na Móna and the ESB at that stage. I would welcome an honest approach being taken with the communities. They need and deserve honesty. What is happening at the moment is probably neither just nor a transition. If we are going to get there, I would welcome that. If that is the future the communities of the midlands face, they deserve to know it and we need to be prepared to plan that future with them.
Ms Anna Marie Delaney:
On the holistic plan that is being developed by the START programme, there is a significant amount of community engagement in that and it is about reassuring communities that they are not alone. There is an audit of bog communities affected, and the development of a suite of community resilience supports is to be worked out as part of that. Development of social enterprise and well-being in those local communities needs to be part of the plan.
I fully agree with Mr. Boland that this has to be community-centred. It is estimated there are 20,000 jobs in retrofitting. I think there will be a similar number of jobs in re-wetting bogs, which Bord na Móna workers have real skills in. There may be a similar number of jobs in forestry. Going back to what I was saying earlier on, we are doing none of the training for this. We have none of the apprenticeships and none of the institutes of technology is doing it. We have only one forestry class coming out. There are no apprenticeships coming in the craft of retrofitting.
I was thrilled to hear about the one in Wexford.
On the basis of being upfront and straight, it is clear from the recent court case that there is no legal planning permission for any industrial peat extraction. The application to have industrial peat extraction made exempt was turned down by the courts. All of the existing industrial peat extraction is illegal and could end tomorrow. On the need for scale and an urgent response, we should let people know that what is taking place is not legal and could legally be stopped at any moment. We need to ramp up our engagement with the communities on that scale of challenge.
I thank everybody for their contributions. By way of background, the Department has provided lots of detail on what appears to be many successful employment initiatives and start-ups in the midlands. It is sobering to recall that the unemployment rate in 2015 was 14.9%, whereas it now stands at 6.6%. I know from my constituency in Donegal that one of the main factors in the reduction in employment was emigration.
Can the witnesses provide statistics on how many of the 19,500 jobs that have been created are based in the midlands, how many have been taken up by long-term unemployed people in the midlands and how many people have emigrated from the region since 2015? As has been said, people are in work but they may be working in Dublin and Galway. I am interested in finding out those figures.
Mr. Hughes stated that the midlands plan sets out seven strategic objectives. Two of the objectives listed were a transition to a low carbon economy and big data opportunities. How are those two objectives compatible? I presume that big data opportunities mean data centres.
I am glad it is not data centres. EirGrid estimates that the demand from data centres could account for up to 36% of Ireland's electricity demand by 2030 and 75% of new electricity demand growth. How are big data opportunities compatible with a low carbon economy?
Does the SEAI have examples of sustainable energy community projects that are located in the midlands? What lessons can be used to develop such projects as part of the transition?
Mr. Declan Hughes:
With regard to the seven strategic objectives of the regional enterprise plan, the stakeholders, working in conjunction with the agencies in the region, have decided that these are the areas of greatest opportunity for the midlands region. The transition to the low carbon economy is a huge challenge but also an opportunity given the asset base that the midlands have. The new opportunities, which we just discussed with Senator Hackett, include the opportunities to reuse Bord na Móna bogs for an energy park, aquaculture, herb growth, etc. There are, therefore, tangible opportunities for reuse.
A second opportunity arises from having a low carbon town, namely, Portlaoise, acting as a demonstrator and developing new technologies, including smart technologies, for managing urban areas. These can then act as demonstrators for others and will, hopefully, stimulate innovation. Another opportunity is the county climate change adaption plan, which involves local authorities working on resource efficiency and reuse. As a pillar in its own right, that presents opportunities for developing new jobs and businesses and for transitioning the workers. Last Monday, Bord na Móna issued a statement on what it considers to be opportunities to create about 500 new jobs.
The Deputy asked about leveraging opportunities in big data and data analytics. That is really saying we should position the region for the future. A key part of that is investing in research, science and e-hubs in the region so as to create jobs for people who, as the Deputy noted, live in the region but may commute to jobs in Galway or Dublin. Could we get these people to come back? Are there opportunities in those areas and in developing the talent pool?
Mr. Declan Hughes:
Data centres are mentioned as one potential area. It is the third action. As the Deputy will know, data centres have a very strong focus on ensuring that they use and invest in renewable energy. The Government has produced a statement on the development of data centres. These centres are a key part of ensuring we can support the 120,000 jobs in the ICT sector, which comprises software, data management, call centres, etc. The sector needs server farms or data centres.
Mr. Declan Hughes:
In any business, there will be a set of servers somewhere that provides computers and so on. That also applies to the Houses of the Oireachtas. Data centres are an essential part of the digital smart economy. The key point as regards data centres is to ensure they stick to their own objectives of using and investing in renewable energy and are optimised in terms of the use of that energy. Ireland is not a bad location for data centres because we have a good, moderate climate which facilitates minimal use of air conditioning.
Mr. Joseph Cummins:
The data centres can act as a hook for investment in renewable energy. The very stable energy demand of a data centre is key to securing investment in renewables because it balances the very cyclical nature of households and everyday demand. It makes Ireland more attractive in terms of investment in renewables because there is a guaranteed demand. Regardless of whether it is during the day and we are all busy or whether we are all asleep in bed, there is a steady level of demand. This means an investor in renewable technology can get a return on their investment on a 24-hour cycle.
Ms Anna Marie Delaney:
In terms of employment numbers, some of the statistics we have from the Central Statistics Office, CSO, show that between 2015 and 2019, the only reductions recorded in employment in the midlands region are in the sectors of public administration and human health and social work. All of the other sectors recorded growth in that period, according to the statistics. I know that growth in the midlands has been hard earned. We will try to maintain and grow that further.
Mr. Jim Scheer:
I do not have a specific project example from the midlands but I know that projects are taking place in the region. There are 320 sustainable energy communities currently being supported by the SEAI. Any group of people who want to get together and call themselves a community can get training and support from the SEAI. We can also assign them an expert mentor who can help them to determine an energy master plan for their area and set their own vision for how they want to see the transition happen in their area. There is a map of those on our website on which members can view the various sustainable energy communities by region, drill into them and get some details about who they are. Their contact details are available. I am sure there are some case studies on the web as well. I will take a look and make sure to send on any that are relevant for that area.
That is our sustainable energy community model, which aims to help communities learn about and plan for sustainable energy. Hanging off that, as well as the supports to develop those master plans, we provide approximately €20 million in grants through the better energy communities capital grant scheme. That involves different agencies aggregating homes, including the fuel poor and the can pay sector, to have their homes upgraded along with other sectors, maybe some local businesses, the local community sports hall or schools. There have been between 300 and 400. I do not have the exact number. I will send on the kind of progression with the number of projects that have been supported through that scheme. I imagine there are a couple of case studies coming out of that work as well. We are monitoring the impacts of those schemes because we certainly feel that the community-based model is something that is scaleable to the level we need to get to, and the strength of those kinds of grassroots versus house-by-house schemes are the way forward.
Mr. Padraig Boland:
From the education and training board, ETB, perspective, there is a two-pronged focus in terms of traineeships and upskilling. Part of that is looking at those who are involved or employed in Bord na Móna. The other part is looking at keeping jobs in the locality, because in counties such as Offaly, 93% of our active enterprises have ten or fewer employees. It is a case of recognising the indigenous and small scale and building our strengths. We are looking to harness in some way the entrepreneurial flair that existed in Bord na Móna from the early days when the German and Russian machines came in and had to be modified by men with no education who thought they had little skill, and to build on that entrepreneurial skill and look at enterprise development as a traineeship and a model we could work on.
The other focus is to work with the Department, my colleague, Ms Morgan, the digital hubs, shared working spaces in the midlands, and to look at remote working, with people maybe being able to stay in the midlands. It is not a case of looking at our local employers taking on one extra employee, which is a 10% increase for them, if that is the rate, but looking at those work placeless companies, as it were, where a person can be working for someone in America or Australia or wherever else and based in the rural communities. That person would be living in the communities and keeping the schools and shops open. We are trying that two-pronged approach.