John Browne (Wexford, Fianna Fail)

The Minister for Communications, Marine and Natural Resources has overall responsibility for energy policy and is primarily responsible for the promotion and development of renewable energy, including biofuels. Nonetheless, the development of the biofuels industry is a cross-sectoral issue impinging on several policy areas, for example, those related to environment and fiscal policy as well as energy policy, and involving several Departments and agencies. My Department has been represented on a number of interdepartmental groups considering the issue and there has also been direct contact between my Department and the Department of Communications, Marine and Natural Resources.

I am acutely aware of the central role which agriculture can play in the provision of necessary raw materials for the production of biofuels. These raw materials can include oilseed rape, wheat and sugar beet for the manufacture of liquid transport biofuels, forestry by-products for wood biomass, and other farming by-products, such as meat and bonemeal and tallow, for energy-heat generation and biodiesel, respectively.

Factors such as the increasing cost of oil, the need to reduce carbon dioxide emissions and the opportunity for farmers to explore alternative land uses following Common Agricultural Policy reform, mean that the potential of this area must be fully explored. For the purposes of contributing to the development of policy on biofuels, my Department in conjunction with COFORD and Teagasc, has examined the potential of energy crops, wood biomass and farming and food by-products.

In general, the production of energy crops for biofuels will have to be demand-led and production by farmers will only occur if the economic returns are greater than those offered by traditional crop enterprises. The production of liquid biofuels from energy crops is not economic at current oil price levels. However, the scheme announced by the Minister for Communications, Marine and Natural Resources, for mineral oil tax relief on pilot biofuel projects has stimulated the production of oilseed rape for biofuel. The exploitation of wood resources for energy purposes, mainly for heat or electricity generation, offers significant potential. Sustainable Energy Ireland has recently announced a pilot scheme to grant aid the installation of wood-fired boilers.

I am anxious to encourage further research to assist the development of the biofuels industry. Teagasc has already done some valuable work in this area and I also arranged for research projects on biofuels and other non-food uses of crops to be included in the latest call under my Department's research stimulus programme. The outcome of this call is not yet available but the nature of the projects to be funded will depend on the proposals received.

See this speech in context