Noel O'Flynn (Cork North Central, Fianna Fail)

In the 29th Dáil I was chairman of the Joint Committee on Communications, Marine and Natural Resources. In June 2006 the committee published a major report on energy. The Minister, Deputy Ryan, was an important contributor to it at the time. The Vice Chairman of the committee, Deputy John Perry, also contributed significantly to it. In my preface to that report I observed that:

As the Irish economy develops one of the principal critical requirements is access to affordable and dependable supplies of energy. If Ireland is to meet the challenges of the future then it is essential that a co-ordinated energy policy be put in place as a matter of national importance. Ireland has a very heavy dependence on imported fossil fuels. The reality is that the transport sector is the largest energy consuming sector, is increasing at the fastest rate and is almost totally dependent on imported liquid fossil fuels.

I went on to note that Mr. Bernard Rice from Teagasc told the joint committee that:

[It] should be possible to get 5,000 miles per acre of rapeseed, roughly 100 gallons at 50 miles to the gallon. Therefore, in terms of using bio-fuels it will take upwards of two acres per car for every car in Ireland to continue to drive 10,000 miles per annum - the normal average. Accordingly, using land to grow bio-fuels so as to continue to give every Irish motorist that 10,000 mile driving per annum experience will take up to a very large part of the stock of arable land in Ireland.

This must be a wake-up call and it clearly shows that Ireland needs policies to address the changes that the future will bring.

During the Second Stage debate on the Energy (Miscellaneous Provisions) Bill 2006 I made reference to the appearance before the joint committee of European Union Energy Commissioner Piebalgs and I set out in my contribution how the Commissioner identified the six main issues facing Europe, namely, fully competitive energy markets in Europe, security of supply, energy mix, a climate change goal, technology and external energy policy. I made the point then and I make it again today that if these are the concerns of Europe, they must be the concerns of Ireland as well.

The Energy (Miscellaneous Provisions) Bill 2006 made a start on some of these issues. The Bill moved to facilitate full gas market opening, it sought to underpin the all-island energy market and it granted power to the Minister to provide for the taking of emergency measures by ministerial order in the event of a sudden crisis in the energy market. In addition, it conferred on the Minister the power to issue policy directions to the CER and it sought to expand the functions of the CER with the removal of the legislative constraints to facilitate regulated electricity interconnection not owned by the ESB.

The Energy (Biofuel Obligation and Miscellaneous Provisions) Bill 2010 helps us to move another step forward, which I welcome. The Renewable Energy Directive 2009/28/EC has placed a requirement on all member states that 10% of the energy used in transport in each member state should be renewable by 2020. I welcome that bio-fuels will now play a central role in the delivery of this target and that it will also have the added benefit of reductions in greenhouse gas emissions.

The Government White Paper on energy policy committed to the introduction of a bio-fuel obligation which would underpin delivery of the national bio-fuel targets and which will take account of EU developments. The aim of the Bill is to introduce a bio-fuel obligation in Ireland which will compel road transport fuel suppliers to use bio-fuel in their fuel mix. The effective initial penetration rate will be 4% but it is envisaged that this will be increased over time in line with EU targets and to commitments on climate change and energy security. Many benefits would accrue from introducing this obligation. First, it will help us to meet our commitment under the 2009 EU directive to have a 10% penetration rate of renewable energy in transport by 2020. It will help reduce our greenhouse gas emissions from transport. It will improve our energy security. It will provide opportunities for job creation by encouraging the agricultural sector and industry into new areas. The Bill also ensures that we deliver on our commitment in the Government's programme and White Paper on energy policy to introduce a bio-fuel obligation.

When discussing the Bill, it is important that we are all clear about what the term bio-fuel means. It is a word sometimes bandied about without being fully understood. As such, the term deserves a quick explanation. Basically, bio-fuels are produced from biomass. Biomass is any organic material that originates in plants and animals which can be used as an energy source.

I refer to the many advantages that a bio-fuel obligation offers. One of the most important benefits of introducing the obligation is that it will improve our energy security and reduce our dependence on finite fossil fuels. Last week during a Private Members' motion in the Dail, we were reminded of the benefits of energy security. The bio-fuel obligation encourages us to develop alternative forms of energy. As it stands, some 90% of Ireland's energy requirements are currently imported. This means we spend more than €6 billion overseas ever year on imported fuels. It does not make economic or environmental sense. Transport accounts for a very significant and ever increasing proportion of our energy use in Ireland. It is the fastest growing sector in terms of greenhouse gas emissions. According to the EPA, transport accounted for almost 30% of energy use in 1990. This jumped to more than 40% in 2005. Put simply, it is not sustainable. The great dependence on fossil fuels means the sector is very exposed to oil price fluctuations. In this context, the promotion and use of bio-fuels is something to be welcomed.

Another advantage of introducing the bio-fuel obligation is that it will help us to lower our carbon emissions. We are all acutely aware of the consequences of climate change. The transport sector is responsible for over a third of energy-related CO2 emissions. Bio-fuels provides one of the few available and effective means of reducing emissions from transport. There are several economic advantages to introducing the bio-fuel obligation. It will give a boost to the bio-fuel industry generally by providing a guaranteed market to the bio-energy sector. Bio-fuels will also offer an additional outlet for agricultural products, enhancing farm incomes and creating possible enterprise opportunities for rural communities.

I refer to the example of the USA. No country in the developed world can afford to ignore the issue of energy supply and security. In March 2009, the US Government approved $780 million for an energy stimulus plan. Over two years, the $787 billion American Recovery and Reinvestment Act will allocate nearly $8 billion to energy efficiency. Most of the funding is dedicated to helping those on low incomes modify their homes to conserve energy and lower heating bills. Up to $6,500 can be invested in a home for energy upgrades. The Act also provides money for state energy programs, alternative electricity generation and to reduce energy use in Government and school buildings. The US Vice President, Joe Biden, stated the program will help make the country less reliant on foreign energy sources and will create jobs. The US Government will establish approximately 40 training centres to teach workers how to assess home heating and electricity usage and to make the modifications.

We have established our own energy stimulus plan in Ireland. We have extended the national insulation plan to include a new national energy retrofit programme. Under this programme, €90 million will be invested in 2010 with a substantial proportion of the funds ring-fenced for those suffering from fuel poverty. The retrofit programme will provide an estimated economic dividend of more than €400 million to the economy this year, as well as creating approximately 5,000 jobs next year.

There are many advantages to introducing the bio-fuel obligation. However, we must nonetheless ensure that we guard against any potential adverse consequences for the environment, consumers and those living where the products are sourced. Therefore, I welcome several measures aimed at sustainability included in the Bill. Strict requirements will be applied in respect of the type of land from which bio-fuel crops can be taken. There will also be strict reporting requirements on social conditions. For example, water cannot be diverted from local populations. The bio-fuels used must produce 35% less greenhouse gas emissions than their fossil fuel comparators.

The Bill also requires that measures are taken to protect bio-diversity. In this context, several review clauses have been built into the Bill. This shows the Government is serious about creating a sustainable future in terms of supporting green enterprise and tackling environmental issues head on. I commend the Minister, Deputy Eamon Ryan, on the vision, innovation and leadership in the policies he is producing to provide alternative energy sources. In conclusion, I reiterate that energy policy is critical to the Irish economy and the Bill is but one of a number of tranches of legislation we will deliver to the Irish citizen as part of an energy policy which will secure Ireland's future.

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