Noel Dempsey (Meath, Fianna Fail)

The completion of the most recent round of competitive tendering to support renewable energy technologies, AER VI, is an appropriate opportunity to review the programme. Last May, a renewable energy development group was established to advise on future options on policies, targets, programmes and support measures to develop the increased use of renewable energy in the electricity market to 2010 and beyond. The group's report, which is due shortly, will form the basis of my future policy decisions on the increased penetration of renewable energy technologies in the electricity market.

Biofuels are addressed in the EU biofuels directive. An interdepartmental group has been set up, chaired by my Department, to consider policy options for the development of a biofuels sector.

As part of the ongoing work, a liquid biofuels strategy study was published by Sustainable Energy Ireland in December. In March 2004, my Department secured an amendment to the Finance Act 1999, which provides for the introduction of a scheme for excise tax relief for biofuels.

The European Commission has now given state aid clearance for the scheme. The scheme will be publicly advertised over the coming days and interested parties will be invited to apply for excise relief, through a competitive call for proposals process.

The targets in the directive are indicative and not mandatory and many member states, including Ireland, would not be in a position to meet the 2% target by the end of this year. Ireland is starting from a very low current production base, and the 2% target therefore represents a considerable challenge.

The Deputy can be assured I am committed to the development and promotion of further renewable energy projects in the electricity market and the development of a biofuels market in Ireland's transport fuel sector.

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