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

I also want to respond to the other Deputies I heard on the wider issue of energy security. There are three aspects that we need to consider among others. The immediate key security issue is energy being used as a weapon of war. The Russian Government as long ago as the summer of 2021 started to turn off the gas supplies to Europe in preparation for the war. It is clear now its aim was to reduce the storage in the European system prior to the war starting. That started a spike in prices as early as summer 2021. This is continuing. We have gone from a situation whereby Russia provided 40% of European gas to it providing 10%. This is driving up the price of gas and electricity and all sorts of security risks come with this. I will not set them out here but the Government has taken a series of measures to try to protect our people in the budget last year and again this year and in the energy credits we are providing. The second of four electricity credits will be paid next week. They have been well rehearsed and I do not need to expand on them.

It is important to reflect on another key aspect of this, which is what is happening in the EU, particularly in the European Council of Ministers. It met again this Tuesday and will meet next month. These emergency meetings have been central to our response. There has been a range of measures to try to reduce demand and set mechanisms such as inframarginal pricing so we can get a windfall tax and some of the money unfairly going to the energy industry can be brought back to householders. As late as this week there was agreement on common purchasing arrangements, changing the benchmarks on how we price gas and putting in circuit breakers so if the price is very volatile we try to take it out of the market. This includes plans for the storage of gas. This is one of the reasons, along with a warm winter and relatively low demand in Asia, we have seen some of the extreme prices that we saw this summer coming back down. The real security risk is likely to be when we have to refill our gas storage for next winter and potentially the winter after that. While the prices have reduced significantly in recent weeks, we cannot expect that the security crisis has passed. It has not. No one can predict what will happen in this war. I cannot remember which Deputy - perhaps it was Deputy Nolan - said that we do not have gas storage on our island. We have never had it. We have never seen the need for it because we were connected, and still are, to what we see as a very secure energy supply through the Kinsale gas field, the Corrib gas field and the connection to the UK and Norwegian gas fields.

The CEPA study, which we have completed and published, comes at a very timely moment, particularly after the two explosions on the Nord Stream gas pipelines in recent weeks. It is right for us to look to develop storage as a backup security system. We should do so in a way that can be future proofed and help us as we develop offshore wind and convert it to hydrogen to give us the capability of also storing hydrogen and shipping it via pipelines. In future we could be a source of security for our neighbours with gas coming from our system. It is complex and it is not something we can develop for the immediate crisis this winter. The report sets us in the right direction on we can and should do.

I am conscious of time as it is very tight to cover the various aspects of this. Another element of security is our electricity system. Deputies are correct to say we are in a tight situation between generation and demand. We have to be very careful how we get through the next two to three winters. I would say to Deputy Naughten that the cause of this goes back many years. It goes back to the middle part of the previous decade particularly, and the difficulty that existed then as we switched from an electricity system dependent on dispatchable baseload generation, all of it fossil fuel, towards a renewables-oriented electricity system. In this regard, the actual investment and financing of fossil fuel generation became difficult because everyone knew it would not get priority dispatch as wind would be at the centre of our system. Therefore, people wondered why they should invest in fossil fuel backup when they did not know what the running hours would be. This was the reality throughout Europe and the world in the new renewable electricity system that was evolving and was where all the money was going. It took some time through 2016, 2017 and 2018 to devise a new capacity auction system to fit this new reality. This is why the auctions only occurred in 2018 to provide further backup generation capacity, which we needed, as everyone could see. Those actions did not deliver. We have rehearsed this in the House on numerous occasions. This was largely because some of the equipment that was expected to be able to deliver it was not available from the original equipment manufacturer. There was also the issue of the planning system being as slow as it is in this country. The ESB was not able to get its project through the planning system in time to meet the conditions set out in the auction.

As has been said, Mr. Dermot McCarthy will be reviewing all that and coming up with further recommendations as to how we structure our system for this reality. However, that was the centre stage of the problem we had, which has now been addressed by the Government procuring and purchasing emergency generation capacity. We had a debate about this in the Chamber last night as the emergency legislation was put through the House. We still have to be very careful, due to high prices, the climate and meeting demand, to do everything to reduce our demand wherever possible. We must be careful in terms of the peak hours, in particular, because that is when the plants that generate the most expensive power and use the highest amount of fossil fuel run. This is in addition to the purchase of additional equipment and other auction systems. Everyone here who made the case for solar, battery and pump storage and the use of additional renewables, such as onshore and offshore wind, are absolutely right. That is what we are committed to delivering and developing.

We will manage to get through this difficult crisis. In switching to renewables, far from being reckless, as Deputy Nolan put it, I would argue it is the sanest, safest, cheapest, and best option for the Irish people. Any independent analysis will show that it is the cheapest source. We have the strongest resources, in which we have real capability and expertise. The financing and entire energy system, other than the Irish Academy of Engineering it would seem, understand that this is the direction in which the world is going. The European Union and all its legislation, all the investment house, as well as the United Nations climate system and so on, are saying this is way to go. This is where the modern, new energy economy is going. We can and will be good at it.

Deputy O'Connor and others have asked why we are not more open to further oil and gas exploration. There are a variety of reasons for me saying “No” to this. First, it does not provide energy security. We have gone out 160 times and struck gas three times. All the easy sites have been checked. The odds of finding something more is 100:1. It costs €100 million a pop to do a drill. It is lunacy. It is not security. Second, on a climate basis, we have to stop extracting, exploring and developing new fossil-fuel gas supplies. If we use the existing proven reserves, the world will burn to a cinder and that we have to stop.

I am not sure who raised the Kinsale gas field. It may have been Deputy Naughten who said that we should use the Kinsale gas field as storage. I do not agree. The proposals set out in the CEPA study, about an onshore facility that can convert supplies to hydrogen, are better. A significant volume of cushion gas would have to be used in the Kinsale gas field to give it the pressure needed to use it as a strategic store. That would be incredibly expensive, as well as technologically difficult, to deliver.

What do we need to invest in? What is key is the grid; the interconnection to other countries; the smart meters that help us use power in clever ways; the transmission grid, which we need on our island; and the new transmission grid, which we will develop to tap into offshore energy. That is not sexy or exciting or the centre of huge public debate. As Deputy Leddin said, it is easier to blame data centres for the source of our woes. The centre of our success and security will be in creating a balancing system between variable supply and variable demand, by combining our renewable supply and variable demands together, in addition to ensuring interconnection with other countries, north-south as well as east-west. That is the centre of our security strategy and is the best way forward for us, and it is what I am committed to delivering in our time in government.

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