Seán Power (Kildare South, Fianna Fail)

I thank Deputies from all sides for their help in advancing the significant measures provided for in the Electricity Regulation (Amendment) (EirGrid) Bill. I especially thank those Deputies who spoke on Second Stage and who contributed on Committee Stage for their positive input to the Bill and its various provisions dealing with the east-west electricity interconnector. I note all Deputies recognise the strategic national importance of the interconnector and the pressing need to expedite its delivery in the shortest possible timeframe.

I take this opportunity to mention some of the potential benefits to Ireland from interconnection with the UK market. The annual generation adequacy report, produced by EirGrid, sets out forecasts for the supply and demand balance for electricity over a seven year period. This report has identified a need for additional capacity over the next seven years to maintain security of electricity supply. I am advised there is significant generation capacity available in the British energy market. The east-west interconnector will link Ireland to that market, enhancing security of supply on this island.

As the UK market is also one of the most liberalised energy markets in Europe, the east-west interconnector will also enhance competition in the Irish electricity market. This, together with the all-island single electricity market should, over time, exert downward pressure on electricity prices.

The east-west interconnector will also enhance fuel diversity by providing an external source of electricity which will reduce our dependency on gas-powered generation. At present, some 60% of our electricity is generated from natural gas, which is primarily imported from the UK. The east-west interconnector will also support the increased penetration of renewable generation, particularly non-dispatchable wind generation in the Irish market. It will allow surplus power to be exported to Britain in times of high wind generation. As a nation we have set ambitious targets of progressively achieving 33% of our electricity consumption from renewable sources by 2020. The all-island grid study shows that even higher targets may be possible. This study also identifies the east-west interconnector as a key enabler for delivering these ambitious renewables targets. It is for these reasons the Government has attached such a high priority to the delivery of the east-west interconnector.

The Bill is one of a suite of important measures that will allow the Government to continue to drive forward its progressive energy agenda. One amendment was introduced on Committee Stage to clarify the powers of subsidiaries of EirGrid. This step was taken with a view to ensuring there is absolute transparency and certainty as to the powers of subsidiaries of EirGrid to carry out certain functions with regard to the east-west interconnector. The amendment was drawn up in consultation with the Office of the Parliamentary Counsel and eliminates any legal uncertainties regarding subsidiary companies. EirGrid has advised that the amendment will help avert any potential delays to the commissioning of the interconnector by 2012.

The Department of Communications, Energy and Natural Resources, along with EirGrid and the Commission for Energy Regulation is continuing to examine all aspects of this project with a view to ensuring all possible steps are taken to expedite the planning and development processes. In the meantime, the Department is continuing to participate in the high-level co-ordination group, which has been established under the chairmanship of the Commission for Energy Regulation to oversee and ensure completion of the project to schedule. I am advised that work is progressing well. This work will be further facilitated by the swift passage of this Bill through the Oireachtas. I again thank all Deputies for their co-operation and assistance in advancing this Bill through the House.

See this speech in context