Mr. Rory Somers:

By way of information on the State aid issue, RESS is an auction-based support scheme for grid-scale renewables and it is there to deliver on the objective of reaching the 80% renewable electricity target by 2030. It is a very substantial target, higher than any other member state is attempting to reach. We are very much at the vanguard of the deployment of renewable electricity into the electricity grid. In order to do that, there is guaranteed funding for the successful prices bid. At the moment, we all recognise that with electricity prices being high, there is no need for the public service obligation levy, PSO, to fund because there is no gap between the market value of electricity they receive and their bid price. However, those projects would not go ahead unless they had an insurance policy, if they were not underwritten by the PSO for times when we all hope electricity prices will reduce again; it certainly was the case when the scheme was developed and approved by the former Minister who is sitting with us today.

When one relies on the public service obligation levy, from which public money is effectively used through the payment of electricity customers, one has obligations in relation to state aid. The committee is probably aware that member states are obliged to comply with state aid regulations. For small amounts of money there are de minimisamounts. There is a self-reporting requirement under general block exemption regulations, whereby the member state has to notify the EU, but there is not a lot of other reporting.

With the scale of moneys required under the RESS scheme overall, billions of euro, the EU has a policy around interfering in the marketplace and it wants everything done on a competitive basis because the electricity market is an open, competitive market. To allow us to have the community ring-fenced category within the State aid approval was innovative at member state level within the EU. It was a departure for the Commission and I wish to say that upfront. It was also recognised by the Government that it wanted to include communities and bring them along the journey. That was the reason we went to the Commission knowing it was something it had not supported in the past but we recognised as a Government and a Department that it was important to separate community involvement. We believe in the principle that if you bring the communities along, it will support and reinforce local attitudes towards grid-scale renewables. To get them involved directly, initially in the renewable electricity support scheme, they had to be at least 51% owned by community members. That was recently changed for RESS 2. That figure is now 100% owned by community members. That is to deal with the potential. There were other examples, such as in Germany, where that was attempted but developers found ways around that to take up that capacity within the auctions in Germany. We wanted to avoid that, and the requirement in RESS 2 is for 100% community owned. That again puts us at the vanguard of what is happening in the EU.

I was in Brussels last week at a seminar of the Commission with all the member states on active consumers in energy communities. We were invited to present to the other member states on what we have done in Ireland in relation to the supports and how we are developing the community network. The response from the Commission was that we were very far ahead of many other member states. I wish to tease that out a little bit. Many countries have done community-activated projects, but that has happened primarily in the past ten years. There is very little going on with a lot of stagnation in that space. Many member states are looking at it in a purely competitive, market price environment. Communities are offered the opportunity to participate but they do not participate. From our perspective, the Commission was very interested in the fact that we have these community supports through the SEAI that are very well developed and clear. We have a network of a huge number of active sustainable energy communities that are widely dispersed across the country and are supporting community efforts to get involved across a range of activities. The fact that we were funding this directly with Exchequer funding was also a point of note.