Brian Cowen (Laois-Offaly, Fianna Fail)

In the commercial area, we introduced a bio-heat scheme for grant-aiding, for example, wood pellet burners. I am extending this scheme to cover the installation of other technologies such as solar panels. I am also extending it to buildings in the non-commercial sector such as community centres, and sports facilities so that they will also be able to avail of the grants. The planned additional spending for the next year is €4 million, partly funded by a reallocation of resources within the Department of Communications, Marine and Natural Resources.

Better energy efficiency and demand management and initiatives pay significant dividends for business as well as households. I am providing additional funding to Sustainable Energy Ireland of €3 million in 2007 to develop pilot programmes to support small and medium enterprises in assessing their energy usage and measures to enhance energy efficiency. Impacts of the pilot scheme will be reviewed during 2007.

On renewable energy, a scheme of tax relief is in place in the form of a deduction from a company's profits for corporate investment in renewable energy products in the solar, wind, hydro or biomass technology categories. This scheme was due to end this year. I propose to continue this corporation tax incentive for investment in renewable energy projects for a further five years, subject to EU approval.

Agriculture — energy crops

I am conscious that we are trying to establish a national bio-fuels supply chain, almost from scratch, and it is appropriate that we offer assistance at the various stages from crop establishment onwards.

The Minister for Agriculture and Food will shortly announce, subject to any necessary EU approval, grant aid for the production of energy crops in three stages from establishment to harvesting. First, establishment grants will be introduced for willow and miscanthus where costs of establishment are very high and there is a wait of several years before harvesting can begin.

Second, there will be a national top-up of €80 per hectare, in addition to the existing EU premium of €45 per hectare. Finally, there will be grant aid for the purchase of the expensive, specialised harvesting machinery needed. The cost of these three measures will rise to €6 million in 2009.

Excise on kerosene and LPG

As I announced in last year's Budget Statement, I am abolishing the excise on Kerosene and LPG used for home heating from 1 January 2007.

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