John Browne (Wexford, Fianna Fail)

I thank the Minister for introducing the Bill. It is quite timely in the present climate of high oil prices. The Minister, when replying, might comment on the high prices because I do not believe the cost of crude oil bears any resemblance to the price of oil in Ireland. Prices of diesel and petrol seem to be at an all-time high.

I worked in the oil business for 15 years before becoming a Member of this House and I have a fair idea of how it operates. There is certainly very little competition and there are many cartels in operation. The Minister for Communications, Energy and Natural Resources and the Minister for Transport should be demanding that the oil companies state why the price of oil is so high. The price is certainly having a major effect on transport operators. Many of them are in contact with me daily and state that because of the great increase in the price of oil, the fact that we are in a recession and the fact that they are unable to get increases from companies for which they operate, they find it very difficult to survive. We need to consider this very seriously.

In the south east, there is Green Biofuels in Marshmeadows, New Ross, and there is a bioethanol facility proposed for Belview Port. Glanbia has a pure oils development at Gorey in County Wexford. There are many opportunities in my county and the south east in general to develop the industry.

The legislation to introduce the bio-fuel obligation is very important and I am pleased to have the opportunity to speak about it. The Energy (Biofuel Obligation and Miscellaneous Provisions) Bill 2010 will introduce a bio-fuel obligation in Ireland. Under the terms of the legislation, an initial bio-fuel penetration rate of 4.166% is being set, to be increased over time in line with EU targets and further commitments on climate change and energy security. This bio-fuel obligation will be administered by the National Oil Reserves Agency, NORA, on behalf of the State. Its introduction follows movement at European level, in particular the renewable energy directive by the EU Commission in 2008. This directive set out a mandatory target for bio-fuel penetration in road transport fuels within the European Union of 10% by 2020.

This legislation marks a significant step forward for Ireland. From the date of the introduction of the obligation, 1 July 2010, all petrol and diesel on sale in this country will Include at least 4.166% bio-fuel. This means that within the first year of the operation of the obligation, some 220 million litres of fossil fuels will be substituted with bio-fuels. This penetration is expected to increase to over 500 million litres by 2020, in line with EU regulations.

The introduction of this bio-fuel obligation is, therefore, excellent for Ireland's environment and each and every one of us. Ireland, like all European Union countries, has agreed to reduce carbon emissions as part of international environmental commitments. An important step towards reaching our goals in this regard will be to increase the use of sustainable and renewable energies, including bio-fuels, and this new obligation will be taking a considerable amount of fossil fuel out of our vehicles' engines and replacing it with green and renewable energy.

The introduction of the bio-fuel obligation will lessen Ireland's dependence on the importation of fuels. Bio-fuels can and are being manufactured in Ireland. By producing these fuels at home, we are helping to make the country more energy-independent. This is vital for our country, which at present is dependent to a large extent on the importation of various forms of energy from overseas and is, therefore, at risk should their supply be compromised.

In addition to these benefits, investing in renewable energy sources such as bio-fuels offers Ireland a considerable opportunity for growing an indigenous bio-fuel sector and generating employment with the sector. The twin concerns of environmental protection and energy security mean the development of a strong bio-fuels sector in Ireland should be a priority.

Much of our focus at present is, understandably, on matters concerning our economy, industry and unemployment level, but renewable energy and bio-fuel production do offer us potential for growth and job creation. Ireland's first and only commercial-scale biodiesel manufacturing facility is up and running in my constituency. The company, Green Biofuels Ireland, is based in New Ross and currently employs 22 people. It was established by a group including the Wexford Farmers Co-Operative Society, which comprises some 4,000 farmers. When I served in the Departments of Communications, Marine and Natural Resources and Agriculture, Fisheries and Food, I was very involved in helping and supporting this local group, along with Deputy Connick and all of the other Members of the Oireachtas from County Wexford. We agreed that there was a tremendous opportunity for County Wexford to lead the way in this area. The then Minister for Communications, Marine and Natural Resources, Deputy Noel Dempsey was fully supportive. He came to County Wexford to open the plant. I am happy to say that it is now up and running and providing good employment. This green energy is seen as part of what we should be developing for the future. The company deserves great compliments on investing such a huge amount of money in the plant.

The simple aim of Green Biofuels Ireland is to use waste material to manufacture a renewable diesel substitute which can be distributed through forecourts to consumers, thereby reducing greenhouse gas emissions and improving Ireland's security of fuel supply. Biodiesel has a number of advantages over conventional mineral diesel fuel: it is a clean burning alternative to mineral diesel fuel; it is produced from renewable sources; it is non-toxic and biodegradable; and it dissolves in water faster than sugar. In terms of use to the consumer, biodiesel may be used as an alternative to standard mineral diesel in most applications. It is important that it does not require engine modification because the substantial amounts of money associated with previous forms of engine modification did not encourage people to take such action. Biodiesel can be used conventionally without any engine changes. It also has greater lubricity than fossil diesel, which means it prolongs the life of the engine.

Green Biofuels Ireland has the capacity to produce more than 34 million litres of biodiesel annually. The biodiesel produced by the company is largely produced from waste, including cooking oils and similar by-products. As a second generation bio-fuel, biodiesel is produced from waste and therefore does not have to compete with food production for land. Over the years, some people have expressed concern about suggestions that food production might be compromised by the development of bio-fuels. This form of bio-fuel will not have any effect on the use of land for food production. The use of the biodiesel produced in New Ross results in the saving of a minimum of 90,000 tonnes of carbon dioxide each year, which is equivalent to removing 25,000 cars from our roads. These reductions are helping Ireland to meet its commitments under the Kyoto and climate change protocols. While the current production capacity of Green Biofuels Ireland is 34 million litres, the New Ross facility has the potential to double in size. This could be of significant benefit not only to the local community, in terms of employment, but also the Exchequer. The company is currently involved in a research and development project with the support of the Marie Curie industry academia partnership and the Pathways Europe funding scheme. The project involves research into the use of algae and seaweed oils as raw materials for bio-fuel production.

It is important that this legislation is brought through the Oireachtas as quickly as possible. The Minister has met representatives of Green Biofuels Ireland, as we have on a number of occasions. They would be concerned if any delays in the passage of this legislation through the House were to be envisaged. They want to get on with the business of developing, expanding and creating jobs. As biodiesel is a clean burning alternative to mineral fuel, it is an immediate solution to the problem of reducing our dependence on imported fuels. As the Acting Chairman, Deputy Johnny Brady, comes from farming stock, he will be interested to hear that biodiesel works on heavy duty transport applications, such as farm machinery, as well as private cars and other vehicles. I have mentioned the Green Biofuels Ireland facility as an example of the type of high-tech job creation, growth and development that should be encouraged in Ireland at present. The Government and Deputies on all sides of the House are looking for alternative forms of job creation. This is certainly a possibility in that regard. I hope the introduction of the new bio-fuel obligation will encourage the ongoing development of a vibrant bio-fuel sector and lead to increased research into bio-fuel alternatives that can lessen further our dependence on imported fossil fuel.

I would like to mention another company, Ethanol Ireland, which is based at Belview Port, across the border in County Kilkenny. It is anxious to get its project, which involves the production of bio-fuels from wheat, up and running. We all know that farmers are going through a difficult period at present, as they try to sell barley and wheat. It is farcical that Diageo is no longer purchasing malting barley from farmers in counties Wexford, Wicklow, Kilkenny and Kildare. It is importing it from England instead. I do not agree with its claims that there are some problems with Irish barley. The quality of the barley that is grown in the counties I have mentioned has been recognised throughout the world for many generations. Diageo has taken great pride in proclaiming the virtues of beer, etc., produced from Irish malting barley. Farmers in County Wexford, who have been producing top-quality malting barley for many years, have led me to believe that Diageo is now importing barley from England and other European countries. Perhaps we can encourage Diageo to make a statement on the matter, which I hope to raise on the Adjournment tomorrow night.

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