Eamon Ryan (Dublin South, Green Party)

I propose to take Questions Nos. 57 and 87 together.

The national bio-fuel obligation will require suppliers of road transport fuels to ensure that 4% of their volumes sold on the Irish market is bio-fuel. The legislative basis for the obligation is provided for in the Energy (Biofuels Obligation and Miscellaneous Provisions) Bill, which has recently been introduced in the Oireachtas with a view to its enactment in the coming weeks and entry into force by July next.

My Department calculates that in a full year, approximately 220 million litres of bio-fuels will be required to deliver the 4% target. In 2008, the last year for which data are currently available, 85 million litres of bio-fuels entered the Irish market. My Department currently compiles information on the origin of bio-fuels imported under the mineral oil tax relief schemes, MOTR. Under the schemes, approximately 30% of eligible bio-fuels were produced in Ireland in 2008, with the remainder being imported.

The production of bio-fuel in Ireland has been incentivised to date under the mineral oil tax relief schemes, which have resulted in 18 projects being awarded excise relief on specified volumes of bio-fuel they produce. At least five bio-fuels plants have been constructed or redeveloped on foot of excise relief granted under the schemes. A number of others are either at an advanced stage of planning, or have received planning permission.

Prior to the introduction of the excise relief schemes in 2005, market penetration of bio-fuels in Ireland was almost non-existent. While a figure for market penetration for 2009 is not yet available, it is expected to be in excess of 2%. The steady growth in indigenous bio-fuel production is reflected in the fact that it represents over 50% of bio-fuel production to date. The excise relief schemes were designed as an interim measure to increase the level of bio-fuels in the fuel mix and to encourage the development of an indigenous bio-fuels industry in advance of the introduction of the national bio-fuel obligation.

The national bio-fuel obligation will, by definition, incentivise the sustainable growth of the Irish bio-fuels market and will support indigenous bio-fuel producers and expand the sustainable indigenous production of bio-fuels. The EU sustainability criteria will also provide competitive advantage for Irish and other EU producers by ensuring that non EU imports meet strict environmental guidelines.

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