Dáil debates

Wednesday, 29 June 2022

EirGrid, Electricity and Turf (Amendment) Bill 2022: Committee and Remaining Stages

 

3:27 pm

Photo of Eamon RyanEamon Ryan (Dublin Bay South, Green Party) | Oireachtas source

In response to Deputy O'Rourke, I expect it will be a single Supplementary Estimate that we will bring to the Dáil, and it will be to Vote 29 of the Department of the Environment, Climate and Communications. That capital is then provided to EirGrid to be able to place the orders and, in turn, for it to enter into contracts or to sell on the equipment to developers.

The key thing is that it will be in place in October 2023 for the winter of 2023 to 2024. I apologise that I missed the debate yesterday as I was at the European Energy and Environment Council in Luxembourg but I am sure the Minister of State, Deputy Ossian Smyth, made the case. This is different from the procurement of those 200 MW of other capacity. We started the process of engaging in procuring that 200 MW of generation units a year or a year and a half ago and it will take almost two years. It had been subject to legal challenge but any procurement process would have taken a similar two-year period. This approach is quicker and we would look to see the units up within a year or a year and two or three months through a purchase arrangement, rather than a procurement arrangement, as such. The main reason we decided to take this approach is that we expect our particular tight spot will be in the winter of 2023 to 2024, so to have it in place in October was the key measure.

As I said with regard to those procurement units, if we add the two together, the sum is 650 MW, which is what we need. I expect there will be further recoupment for the public and for the Exchequer in that it is a short-duration contract for three to four years, or three to four winters. After that, having been paid back through a charge, which will be the mechanism of paying for the developers, a resale value, which we have not taken into account in some of the figures that have been mentioned, will be netted back to the householders in line with any residual value. I expect there will be a residual value. From talking to my European energy colleagues yesterday, they are all in similar boats, whereby they are ramping up renewables massively and realising they will need open cycle, flexible generators to back up that. I expect there will be a very good market in this country or, if not in this country, in other markets for the equipment to be resold, and that would recoup some of the cost to the public.

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