Dáil debates

Wednesday, 18 October 2006

Energy (Miscellaneous Provisions) Bill 2006: Report Stage

 

Bill recommitted in respect of amendments Nos. 1 and 97.

4:00 pm

Photo of Rory O'HanlonRory O'Hanlon (Cavan-Monaghan, Ceann Comhairle)
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Amendment No. 1 is consequential on amendment No. 97. Amendments Nos. 1 and 97 will be taken together by agreement.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I move amendment No. 1:

In page 3, line 9, before "AND" to insert the following:

", TO PROVIDE FOR THE ISSUE OF CAPITAL STOCK IN BORD GÁIS ÉIREANN,".

Amendment No. 97 amends the Gas Act 1976 by inserting a new section which confers on Bord Gáis Éireann the power to create capital stock in amounts equal to the net assets of the board. The provision is required to facilitate the introduction of an employee shared ownership plan, ESOP, for employees of the board in the absence of the introduction of plc legislation. This will give effect to an employee shareholding plan in Bord Gáis Éireann of up to 5% without waiting for the passage of legislation to change the status of the company from a statutory corporation to a plc under the Companies Act.

Amendment No. 1 simply changes the Long Title of the Bill to reflect the insertion of the new section.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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I agree to proceed with the recommittal but I wish to put down a marker that in any such situation in the future I would like to see the whole Bill redrafted and returned for a Second Stage debate. It is highly unsatisfactory that a Bill comes in truncated versions and the final version bears no resemblance to theoriginal.

I support the notions contained in amendment No. 97. It improves, updates and takes on board the requirements of a modern company, specifically Bord Gáis. I have no difficulty with the proposal to bring the company up to date and into modern contention.

Provisions for staff have progressed over time and give them a reason for a particular and special commitment to a company. It augurs well to have the staff involved in a meaningful way, apart from merely working for the company. Recent developments, however, in other areas indicate we need to be careful because in privatisation and flotation bids a pattern has emerged recently whereby anybody involved in the takeover attaches great importance to making an offer that the staff cannot refuse. This issue will arise repeatedly.

EU competition laws are designed to protect the consumer by ensuring there is competition and ample scope for its development. Some companies may achieve a particular value in the marketplace. We need to be watchful of how this develops because arising from recent events in more than one area, it seems the consumer might well come off second best after the segments offered for accommodation and delivery by those interested in flotation and privatisation fall into place.

While this amendment is progressive and necessary it has drawbacks. Over my career in this House I have seen that what appears to have been a beneficial and important involvement of staff in any enterprise in the event of a flotation, takeover or privatisation the staff is the first target. This in turn renders the concept unstable and could undermine the kind of competition to which it is intended we aspire and that is intended to benefit the consumer.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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In general terms I support the amendments to the title and amendment No. 97 regarding Bord Gáis Éireann in respect of capital stock. There are, however, serious issues of competitiveness in Irish business and industry. As this is a miscellaneous provisions Bill and the domestic and business gas market face major challenges why did the Minister not use the opportunity to expand on some of the issues that need to be addressed in respect of Bord Gáis Éireann and its future? These include aspects of unbundling, the establishment of the ISO and the general development of a more competitive market. This morning on Leaders' Questions, the Taoiseach listed several energy companies in the UK that had increased their prices dramatically. Yet their prices are still cheaper than those pertaining in the Irish market. As well as missing this key point, he did not realise that a few weeks ago, if the storage capacity was in place, gas could be got for nothing because of the new Norwegian pipeline. While I welcome the ESOP for the workers of Bord Gáis Éireann, why did he not use the opportunity provided by the Bill to address these issues?

The Minister has had three bites of the cherry with this Bill. I do not see it as the way to do the people's business. With the resources available to him in the Department, I cannot understand why he did not introduce a more comprehensive energy Bill or even a new gas Bill to address the challenges of the ongoing development of the gas market. This is particularly apt given that the gas market is significantly different from the electricity one. Some competition has emerged in the domestic market with Flogas providing services in Galway and five other towns. Given that we are part of the UK market, and we have transport costs in addition to the cost of a future second North-South interconnector, why did the Minister not take a more comprehensive approach rather than just a single amendment to the Bill?

Photo of Eamon RyanEamon Ryan (Dublin South, Green Party)
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I welcome the concept of incentivising and rewarding staff in State-owned companies. I am, however, concerned that it may affect the long-term strategic development of such companies. Following the success, from a trade union perspective, of the Eircom ESOP, and the increasing value of the Aer Lingus ESOP, we must be careful and certain in the message that is being sent out about them.

We are looking to establish, or have established, ESOPs in companies with significant assets, such as Bord Gáis, the ESB, Eircom and Aer Lingus. This is not happening with companies without a capital asset backing. Is that an appropriate development? Why are we using such a mechanism only for those asset-backed State companies which are potential privatisation candidates. Can we develop a mechanism that incentivises all State-owned company employees? It must be across the board, not necessarily on the basis of which one has the most assets. How do we provide incentives to workers in State-owned companies where there is no asset backing?

Is there any indication how close the 5% shareholding would be to the €38,000 per worker in any allocation? Bord Gáis is a relatively small company in terms of full-time employees but is significant in its budget and asset backing. If the Minister does not have the exact figures on this, will he provide a rough estimate? How close will it be to the limit of €38,000?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Although the process of drafting legislation to make BGE a plc was in place, the Government decided not to go ahead with it. Two years ago, the BGE trade unions asked me to consider their proposal for an ESOP. I informed them the only basis on which I could agree to such a proposal was if there was meaningful and valued transformation in the company. To some people's surprise, the unions returned with a proposal for such a transformation that met the criteria. Having earlier agreed to consider this, we needed to respond as positively as the workers and the unions had.

Despite what Deputy Broughan may think about the marvellous resources available to me in the Department, there are not enough of them.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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It is more than what the Opposition has.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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With other legislation covering the single electricity market and other energy issues, the Department had to abandon the Bill for transforming BGE into a plc. For that reason, I decided to include it in the Energy (Miscellaneous Provisions) Bill. That is why it is not contained in separate legislation.

Regarding how close the ESOP will be to the full value of €38,000, it will depend on the value of the company at the time. I am informed the value of the ESOP will be approximately €25,000, not the full value.

The unbundling of transmission and distribution operations and other matters are subject to separate legislation and EU directives and there was no need to include them in this Bill.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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The ESOP is usually the first target during a takeover. While seen as progressive in some quarters, in others it is not. What are the Minister's views on this aspect?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Once people are given shares, one cannot tell them what they can do with them. The Deputy referred to Eircom where the ESOP has made a substantial amount of money. Despite what I hear at various times about workers' interests during takeovers, when the workers had the shares, they did not seem to mind how they were bought and sold, or to whom they were sold, as long as they made a profit.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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The primary function of the company is not to trade in shares. Rather, it is the provision of a utility service. There is a grave danger the company might be distracted by other issues such as the buying and selling of shares and so on. I am totally in favour of the involvement of employees in the shareholding of the company because it gives them a particular or special interest. That has long since been my party's policy. The situation is changing, however, in view of increased competition as a result of the liberalisation of markets and so on. We may well find that companies are increasingly privatised, sold or taken over quickly by means of the buying of shares from employees and others.

I ask the Minister to keep this in mind in the context of this Bill. I would not like to see companies involved in the delivery of services such as energy being sold on a regular basis as has happened, for instance, in the case of Eircom. While such a development may be progressive from the point of view of shareholders, be they corporate or otherwise, it may not always be in the best interests of the company in developmental terms. Shareholders may need to look again at how the company progresses in terms of the delivery of its services.

In the United States, where privatisation and flotations seem to work better than they do here, there are provisions in regard to the delivery of utility services whereby an onus rests on the company to ensure adequate refinancing takes place and that its development is not impeded or in any way obscured by the efforts of any party to trade its shares in the markets. The raison d'être of the company must be borne in mind at all times. Concerns in this regard are particularly sensitive in regard to energy. If we were to wake up one morning to discover large swathes of the country were without energy, the hue and cry of recent weeks in regard to the cutting off of telecommunications services to the customers of a particular company would pale into significance.

The Minister and his Department must keep in mind that the provision and supply of energy is a most serious issue. The delivery of energy affects every household, factory and heating installation. I say this as someone who is entirely supportive of the concept of employer involvement in company shares.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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An employee share ownership plan, ESOP, does not imply there must be full privatisation. The Ceann Comhairle has kindly facilitated a discussion of Aer Lingus during tonight's Adjournment debate. It was a characteristic of that company's ESOP development that the workers responded to it by working in an increasingly more efficient way until their company was in a position to rival the competitive leader in the short-haul market. We had the best of all possible worlds as a result of this effective competition between a competitive private enterprise company and a highly motivated State company. It does not follow in any way that the development of an ESOP will mean we are committed to a route of privatisation. Moreover, the workers in Bord Gáis Éireann would be bitterly opposed to us taking that route.

Reference was made to the United States, a country with a complex economy. A discovery I made many years ago when I studied economics was that the United States is characterised by a high level of worker owned enterprises. Many people do not realise that the most competitive economy in the world is also characterised by high levels of worker ownership. I support the point made by my Green Party colleague, Deputy Eamon Ryan, that consideration should be given to developing worker ownership across the public sector wherever there is scope to do so. I would go further by saying that this approach should be taken right across the economy by, for example, encouraging large private enterprises that are capitalised in the stock market to develop a similar type of ESOP structure. My party supports the view that employee ownership often promotes a high degree of worker motivation.

As the Minister said, there is a long history to current discussions regarding Bord Gáis Éireann. There is a commitment from the trade unions to engage in dialogue. It is important to note that many of those who work for Bord Gáis Éireann do so as contractors and often work under difficult conditions. I met some of them recently, many of them immigrant workers working at pace to lay the new network for which the CER has allowed Bord Gáis Éireann levy such high tariffs. Many Bord Gáis Éireann workers do not work directly for the company and will have no chance to become involved in the ESOP.

In general, the idea of a workers' shareholding in return for transformation is positive. The bottom line is that Eircom, as I understand it, is one third owned by its workers. It is amazing that a company in our type of economy should have such high worker involvement. However, Members on all sides of this House believe the Minister's predecessors made a grave mistake in selling the networks.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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Hear, hear.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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It was a disastrous error from which we are still scrambling to recover. The Minister knows this, despite the speech he made some weeks ago on broadband. The key point is that networks are sacrosanct. Key infrastructural networks belong to the 4.25 million of us who make up this nation. This must be borne in mind by everybody concerned, including the workers and the public.

Photo of Eamon RyanEamon Ryan (Dublin South, Green Party)
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Will the Minister confirm that it is only full-time workers rather than contractors who would be able to avail of the ESOP? Does he have details of the numbers of full-time workers?

The Minister said trade union representatives presented him with information on the means by which they planned to improve performance and productivity and that this encouraged him to agree to the giving over of 5% of the company to the union. What were the specific means by which the union proposed to improve performance or productivity?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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My understanding is that the ESOP applies to full-time employees. Deputy Broughan covered the point I wished to make in regard to ESOPs in general and I will not labour it. Shares are bought and sold in the internal market within the ESOP. In regard to Deputy Durkan's concerns, there is no danger of the company taking its eye off the ball in terms of being more concerned about trading in shares than the main business of providing gas for the consumer. That does not arise, nor does the issue of privatisation.

I outlined the background to this ESOP, which was in response to transformation. I do not have the details of the transformation plan but I am sure I will have no problem getting a copy to the Deputies. There has been a significant change in Bord Gáis Éireann over the years. When they initially came to me talking in those terms and I outlined Government policy on the limits and on achieving real transformation and savings, it would be fair to say that not too many believed that they could produce a plan that would yield such savings. Its value is broadly based on savings to the company and the dividend to the shareholder. Twelve months later, they came back to me. That plan was considered and I will provide the Deputy with details, which I do not have to hand. People were satisfied that the savings were real and that the transformation was significant. On that basis, we proceeded with it.

Amendment agreed to.

Bill recommitted in respect of amendments Nos. 2 to 4, inclusive.

Photo of Rory O'HanlonRory O'Hanlon (Cavan-Monaghan, Ceann Comhairle)
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We now move to amendment No. 2 in Committee. Amendment No. 2 is consequential to amendment No. 101, and the two will be discussed together.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I move amendment No. 2:

In page 3, line 9, before "AND" to insert the following:

", TO PROVIDE FOR THE AMENDMENT OF THE TURF DEVELOPMENT ACT 1998,".

The substantive amendment, No. 101, is to raise Bord na Móna's borrowing limit to €400 million. The upper limit of €100 million has remained unchanged since the passing of the Turf Development Act 1998.

The core business of Bord na Móna plc over the years has been the supply of peat and peat-fired electricity-generating stations owned by the ESB and the independent peat-fired power station at Edenderry. It also produces peat briquettes as an indigenous solid fuel for domestic purposes. That solid-fuel business was expanded to include coal and other domestic heating products. Bord na Móna has also developed a horticulture business producing peat-based products for use in the commercial and domestic markets.

While the company intends maintaining its peat and solid-fuel business, its strategy is to develop its interests in the renewable energy sector, including investment in wind, bio-fuels and possible waste-to-energy schemes. It also intends to expand the environmental business, specifically waste management, including landfill and composting, through organic growth and acquisition. It also has plans to expand its horticulture business.

That must all be financed through a mixture of own resources and borrowing, and for that reason the statutory borrowing limit must be increased, allowing it headroom. The increase in the borrowing limit will give the company greater commercial ability to develop its approved future strategic direction, including waste management and electricity generation through renewable sources. The important matter to note is that individual projects that require financing will obviously still have to be approved by the shareholder. Nothing changes there; this simply raises the limit to which the company may borrow.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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I have no problem with updating Bord na Móna, its financial resources and its ability to trade and expand into new markets, providing new services. I spoke about some of the areas into which it is moving. Perhaps the Minister might state to what extent the ESB is committed to Bord na Móna peat contracts and for how many years. For how many years more will reserves of peat be available? How many commitments have been made or contracts entered into? To what extent does it affect the board's finances?

A matter that has arisen many times is the reinstatement of cut-away bogs. There are horticultural proposals, among others, some of which have worked and some of which have not. To what extent, in his discussions with Bord na Móna, was the Minister able to evaluate its proposals? I note that Bord na Móna is interested in renewable energy, which we have already discussed. To what extent is it developing, given the resources that the board has had? Will it have more resources than a small operator in a modest town or village? Has it given, or does it intend to give, its full commitment and support? Will this provision in the Bill suffice to elicit a major, substantial, worthwhile and long-lasting commitment regarding delivery of the alternative energy that must be pursued in future?

My reason for asking is that if we look at charts detailing electricity production from various components throughout Europe, we see that we are not, and should not be, reliant on nuclear energy. In the case of an interconnector, there will be some nuclear-generated electricity in the mix, which will mean fun for the Minister and his colleagues. One thing is clear: if we are to make a serious impact on provision of alternative fuels, import substitution and the economic independence that derives therefrom, we need big players on the field who will make a serious investment in the bio-energy sector.

This Bill provides an opportunity for Bord na Móna to get involved in the area in a major fashion, building on its history of energy provision. We must draw on all possible alternatives, since no single one will solve the energy problem now or in the future. A combination is undoubtedly the route that must be followed in this country if we are to preserve the highest possible security of supply. In our control, within the bounds of these shores, we must have the possibility of producing something sustainable, environmentally friendly, economically viable and available.

Much has been said regarding security of energy supply, but this much is certain. If we produce that supply ourselves from multifarious means, we will have a better chance of controlling it than if we import it from another country whose rulers might decide that they are in a huff about something and turn the tap off. That has serious consequences, and I once again emphasise that whoever holds the portfolio in future will become acutely aware of market sensitivities.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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It could be Deputy Durkan.

5:00 pm

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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Or the Deputy himself.

There is an absolute necessity to deliver supply, since if it is not delivered, there will be weeping and gnashing of teeth. I ask the Minister to comment on the development of alternatives as far as the board is concerned. Will this provision be sufficient and adequate to ensure that development and have the targets been set? The Minister will probably refer to his recently produced discussion document on the area. I am not convinced that sufficient emphasis was placed on Bord na Móna's ability to get involved far more as an energy-producing company.

We hear this all the time. In the 1980s, international energy prices went up very quickly, with peat increasing from IR£16 per tonne to approximately IR£60. If we proceed in the way it appears we are going with regard to energy prices, we will face large-scale job losses of a kind yet unheard of. We are codding ourselves with the notion we can replace all these manufacturing jobs with highfalutin, high-tech jobs using existing expertise. Let us not forget the lesson of the late 1970s and early 1980s when we priced ourselves out of the market and people left the country because they could no longer afford to live in it. Judging by the indications coming from the manufacturing and services sectors, it appears we are proceeding in the same manner and are heading down the same road. I mention this as a warning. The Minister knows it is true as he was around then and saw what happened. He did not have as much experience then as now, but that is to the good. The sequence of events that took place from 1977 until 1981 was the same as is happening now. If we allow energy prices rise to the same extent now and pretend there will be no ill consequences, we will be codding ourselves.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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In that era the Minister was a member of the famous gang of four who were, allegedly, rebels in the Fianna Fáil Party. Look where he is now.

What is the precise difference between the way Bord na Móna as a plc can now operate compared to how the ESB and Bord Gáis Éireann, the other two significant public sector energy companies, operate? Does Bord na Móna have more flexibility with regard to seeking capital for its diversification and expansion programme in the midlands or what additional powers has it? We have obviously increased its limit.

I remember some years ago the Minister's predecessor, Deputy Dermot Ahern, got very excited one Sunday about the ESB board which had gone to the New York financial market to negotiate a good loan for the company for major rebuilding of the network. The Minister had not been told about it — he missed out on many other areas in his portfolio during that era also — and got very excited about it on the six o'clock news. How dared the ESB go over his head and deal directly with financial markets? To what extent does this Bill enable Bord na Móna, which is already a plc, seek further capitalisation and embark on a hopefully vibrant diversification programme?

Earlier, I commended the company for its historic role in the midlands in maintaining employment and utilising our existing native energy resources. Times are changing. What are the company's intentions in terms of biomass? This appears to be an interesting avenue in terms of renewables that Bord na Móna has the experience and expertise to develop. I would like clarification on these issues. I welcome the additional freedom we are giving this important public sector company to operate through these amendments.

Photo of Eamon RyanEamon Ryan (Dublin South, Green Party)
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When amendments come at a late Stage, it is difficult for Opposition Deputies to do in-depth research on specific and significant developments. We are talking here about the major new strategic development of a company of significant historical and economic importance to many parts of the country. It is difficult to do the issue justice in the time available.

If the company goes to the limit of the €400 million borrowing requirement, will the Minister give us some idea of how that would leave the company? What sort of debt would that be as a percentage of assets? It would be interesting to see how exposed the company would be in that regard.

From my recollection of when Bord na Móna representatives appeared before the Joint Committee on Communications, Marine and Natural Resources, when asked why the company had not developed in the renewables sector or the co-fired biomass area, they said there was a legislative or regulatory block to doing so. In this amendment all we appear to be doing is amending the capital allocation Bord na Móna can borrow. Is there any other block or does the company seek any other regulatory change in terms of its operations? If not, why has the company delayed so long in taking a new strategic direction towards development of renewable power supplies and other products?

Given the latest scientific findings provided on an almost weekly basis in scientific journals about climate change, one of the main reasons for reducing the company's dependence on turf is that we urgently need to act responsibly for the benefit of the rest of the planet and our future and reduce our dependence on turf, which is one of the most carbon intensive fuels. If one of the main developments of the process of weaning ourselves away from the use of turf is to be to move towards co-firing of power stations with biomass rather than turf, who will have control or responsibility for that? Is it not a matter for the ESB rather than Bord na Móna? Bord na Móna may conspire or strategise to provide such fuels but the ESB, as the manager of the power stations, has the say-so as to the percentage of fuels and which fuels to use and the subsequent market arrangements. Please correct me if I am wrong on that. Due to pressures on this side of the House, I have not had time to go into the level of detailed research I would like before the House allocates a not insignificant amount of money to a State company.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I thank Deputies for their contributions and their support of this amendment. Give or take a few years, peat contracts with the ESB are due to expire in approximately 15 years, by 2020. The peat supply business is still Bord na Móna's main business with the ESB. If Deputies look at the strategic plan, the company can remain in its current position until 2020 or 2025 and then go out of business, or it can choose to move in a different direction. It is good to see the company look ahead to see how it can diversify. That is the reason it seeks authorisation from the House to increase its borrowing limit. The contract with the Edenderry power plant has about nine years to run.

Bord na Móna is conscious that the amount of land covered by some of the bogs could be an asset and it is looking at the situation from that point of view. Some of the land would be suitable for most types of development, but part of it would not. Some sensitive areas will probably eventually end up as special areas of conservation or wild areas.The company is looking at all of the land it has available.

In the context of the company's development and the renewable energy sector, to which a number of Deputies referred, it is looking at potential uses of bogland or cutaway bogs to feed some elements of the biomass and also the co-firing of power stations. Bord na Móna is conscious of cutaway bogs as assets. I have seen other uses being mooted for bogs in some areas, including a proposal to have an airport built in one bog. We will wait and see.

In reply to questions asked by a number of Deputies, Bord na Móna is conscious of the assets it holds. It will hold some of them, use some in the context of its business and sell some to part-finance a number of proposals for future development.

Deputy Durkan referred to security of supply. He made the point that the best possible security of supply is for us to have our own indigenous sources of supply. I concur with that view. Peat is a secure source. Despite what Deputy Eamon Ryan correctly referred to as the environmental consequences of the use of peat, the reason we got permission from the EU for peat-fired power stations was its security of supply. If we did not have peat, it would be one less source of power for us.

It is difficult to constantly balance the three pillars of energy policy — sustainability, competitiveness and security of supply. If we make a decision such as not to have nuclear generated electricity, we are narrowing our options. We have made that decision and nobody has argued much against it. The consequence is that we have to consider sources such as peat, clean coal technology and, as we are doing, to develop renewable energy.

Deputy Durkan also referred to nuclear generated electricity. I do not believe anybody would be greatly shocked one way or the other. For all we know, some of the electricity that comes into our system through Moyle is nuclear generated. If somebody can point it out to me as it goes through the system, he is a better man than I.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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The Minister's colleague expressed a view on it.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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The Minister, Deputy Roche, knows the difference.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Questions were asked about the difference between Bord na Móna, the plcs and the semi-State companies that are not plcs. The major difference is one of reporting and due diligence that must be pursued. There is not much difference in regard to governance but there is some. Whether a company is a plc or not, in the context of what Deputy Broughan asked, if it wants to expend a significant amount of money on capital, it still has to consult with the shareholders and get shareholders' approval. This has been discussed in regard to the ESB, BGE and Bord na Móna. One still has to get shareholder approval.

Deputy Eamon Ryan raised the issue of whether there is a legislative or regulatory block or changes in regard to Bord na Móna and co-firing. There is not from the point of view of the Government. I am not aware of anything that prevents it from becoming involved in co-firing. The reference is more to regulations from the EPA and others. At one stage, the burning of bonemeal in one of the power stations arose and Bord na Móna was told it would have to go through a full EPA licensing process even to trial it. There is nothing in the current legislation that states it cannot go for co-firing. As the Deputy is aware from the Green Paper and from the views I have expressed, I wish to encourage it and prolong the lifetime of the stations for as long as we can.

In reply to Deputy Eamon Ryan, the other possibility is that it may give rise to questions in regard to the PSO. That may have been what was referred to at the time. The short answer to what the Deputy asked is that there is nothing in the legislation that would prevent it from happening at present.

Photo of Eamon RyanEamon Ryan (Dublin South, Green Party)
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If it were to take the full amount out, what would be the rough debt-equity ratio? How exposed would the company be and how heavily borrowed would it be in regard to its assets?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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It depends on the valuation of the company. Too high a gearing would not be allowed because the shareholders would have to have final approval and if the gearing was too high, it would be refused. That is the safeguard that is in place and, in addition, the directorate would have responsibility. The norm in these matters is roughly a 50% to 60% gearing.

Amendment agreed to.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I move amendment No. 3:

In page 3, line 9, before "AND" to insert the following:

", TO MAKE PROVISION AS RESPECTS THE EFFECT OF CERTAIN AMENDMENTS OF THE PLANNING AND DEVELOPMENT ACT 2000 MADE BY THE PLANNING AND DEVELOPMENT (STRATEGIC INFRASTRUCTURE) ACT 2006".

This amendment is being made to remove any doubt about the status of existing consents granted for certain large scale infrastructural projects and commencement of the Planning and Development (Strategic Infrastructure) Act 2006. This issue was identified following the enactment of that Act and it relates specifically to State development projects, electricity transmission lines and strategic gas infrastructure.

Following enactment, it was pointed out that the wording of the Act was such that there was a risk that such projects could require further consents under the new system, in addition to those already granted, even where they had successfully applied for planning permission already or possibly even where they had already begun development. The difficulty arose because the Planning and Development (Strategic Infrastructure) Act 2006 states that such projects shall not be carried out unless the strategic infrastructure division of An Bord Pleanála has approved them. The Act is intended to streamline the consent process for large infrastructural developments and it was never intended that additional consent requirements would be superimposed where an application for approval had been made or a consent given in respect of any project.

It is important to ensure that potential duplication should not arise and this amendment has been proposed to avoid legal doubt. Its effect will be straightforward as it will ensure that on commencement of the relevant provisions of the 2006 Act, no additional consent requirements will be superimposed where an application for approval has been made or required consent given in respect of electricity transmission lines, strategic gas infrastructure or State developments that require environmental impact statements. A further amendment will be tabled in respect of strategic gas infrastructure.

Prior to the 2006 Act, a number of consents applied to different parts of such developments, including planning permissions and licences under section 40 of the Gas Act 1976. The amendment will apply in the event that an undertaker decides to apply for a modification of a pipeline's route. While the developer will need to apply to the strategic infrastructure division for approval under section 182C of the 2006 Act to make the modifications, the decision of the board will relate to the proposed route modifications only. Planning permission in respect of the terminal would stand. In such circumstances, the undertaker will be required to apply for consent to the strategic infrastructure division if material changes are proposed to any part of the development.

Sections 4 to 6 of the amendment aim to preserve the unified development of strategic gas infrastructure developments, a key aim of the 2006 Act. They will also provide a common sense safeguard against unnecessary delays or the duplication of efforts by developers that could potentially have an economic cost for the country. These sections provide that where approval of a strategic gas infrastructure is already in place, it will not be necessary for a developer to revisit the entire planning process for a gas processing terminal should a modification of a pipeline forming part of the overall infrastructure become necessary. The Long Title of the Bill will be amended by amendment No. 3 to account for these provisions.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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The amendment is interesting because it addresses a matter that has provided much material for debate during the past year and a half. Our country needs to present itself as a modern, energetic and progressive country capable of developing its resources. Every other country has done so and we do not want to portray ourselves as backwards or ineffective.

As I have often stated outside the House, an appropriate procedure should be available to those with concerns about any project, be it a gas pipeline, pylons or whatever. We have brought other gas pipelines through the country, but there were differences in the means of transport and the condition and quality of the gas transmitted.

The sequence of events is important. If we want to generate public confidence, the sequence of events in terms of planning, consents and environmental impact statements should be the same for every project. There is no sense in saying that we made a slight mistake and will change the project so that it will be where it should have been initially. This would undermine public confidence in the system. In the case of the Corrib gas field, the sequence did not follow the right order. Can we be certain that planning, environmental impact statements and consents will be dealt with in the proper order and processed identically throughout the country in respect of future projects of a similar nature? Will the procedure be laid down to avoid deviation?

I want an assurance that the most rigorous health and safety standards will be applied. There is no sense in re-examining the project after it has started and changing the route. Obviously, nothing is wrong with the project if a change is unnecessary. We do not want to be hostages to fortune. I am not impressed by the way the matter was handled by the Minister, the local authority, An Bord Pleanála and everyone else. We all have the benefit of hindsight, but appropriate and timely action should have been taken in light of the volatile nature of the product and the concerns expressed.

Will the Minister explain which came first, the chicken or the egg? Is the planning application made first and accompanied by an EIS? Do consents arise before planning permission, are they enclosed with the planning application and the EIS or do they arise later? Any application that does not conform to the conditions laid down is invalid. We all have experience in dealing with such matters. If the consents were absent, what would be the application's status?

This section relates to changing part of a proposal, such as the laying of a pipe, a matter that was recently brought to our attention. The section will retrospectively authorise what is happening. While I am not one of the people who will question this measure, I want an assurance about whether this legislation will stand up in terms of its compliance with the planning Acts. Polarised debates have already taken place in this respect. The Minister is making a provision to ensure that there is legislation to support what is happening.

I pay tribute to arbitrators such as Mr. Peter Cassells, who spent a long time doing a difficult job. He is of the highest integrity and we have all held him in high regard for many years. He managed, after a long time, to come up with a compromise solution which was not necessarily received with loud applause and acclamation on all sides. He spent quite an amount of time, energy and effort over at least a year for which we should be grateful because to get somebody of that calibre to do such a job under that kind of pressure is not the easiest thing in the world to do. I compliment him.

I was born in that part of the country and I know the territory well. No doubt we should not pass up the opportunity of a worthwhile investment in the west in an area that has suffered from many years of deprivation in terms of population decline and emigration, particularly where it concerns bringing ashore a natural resource. There are more resources of a similar nature, both onshore and offshore, that we need to develop for security of supply. There is no sense in having a resource and shivering in the cold while we look at it underground or underwater. That would not be of much benefit to the economy and it would make us the laughing stock of the rest of the world.

I appeal to all sides, in the interests of moving the country forward, utilising the natural resource, modernising our economy and recognising that there will be investment in jobs, both in the short term and in the long term although the large investment in jobs might not be long term. If we do not adopt a positive attitude and encourage investment nobody will have any sympathy for us when we are in difficulty.

I hope that all involved will do their utmost to meet the requirements laid down by statute to comply with all health and safety requirements, to ensure that all planning requirements are complied with, and to ensure that this proposal is not unique in the world and the Minister, his Department and the local authority can stand over compliance to the highest possible standard in respect of health and safety requirements. Otherwise, something could and — if Murphy's law prevails — will happen which will leave us seriously in jeopardy and embarrassment at a later stage.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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Clearly, this is a complex issue. In amendment No. 78 on Committee Stage I sought to bring within the safety remit of SER all aspects of pipelines and refinery installations, given that safety has been the major background issue to the long saga of the Corrib gas field which is entering its eleventh year. On the one hand, the Minister's amendment on the Title and the substantive amendment clearly imply that when the 2006 Planning and Development (Strategy Infrastructure) Act comes into effect there is a possibility that the pipeline changes and even any refinery changes will have to be revisited in terms of planning consents where there has been an EIS. It may happen, but the mere fact that we are discussing this and that the Minister had it as one of his four key points surely implies that the planning process will have to be revisited.

The Corrib gas field story is remarkable, certainly in the history of major planning applications I tried to invigilate for my constituents and the nearby constituencies. In this case a decision by An Bord Pleanála against the gas transport and refinery system made three years ago was effectively revisited resulting in a totally different decision on which the company is finally trying to act, as we see virtually daily on the television news. That, in itself, is a remarkable state of affairs.

We, on the northside of Dublin, have infrastructural developments pending which far dwarf anything that is happening in the Corrib gas field. There is a high-rise city literally rising on the shore of the Irish Sea. At the north of my constituency, there is the vast redevelopment of Dublin Airport, on which An Bord Pleanála recently held hearings. These developments will impact significantly on the daily lives of my constituents in the future. When An Bord Pleanála makes a decision, except on a point of law, we must live with that, but the history of the Corrib gas field has been remarkable in that the issue was revisited and the concerns remain.

Is it possible that there is a plan B in the case of the refinery? Like many other Deputies who represent our parties on energy, I met Shell in recent weeks. The company spoke about its determination to plough ahead over the next three years to bring the gas ashore. This is what we all want. We desperately need it, as the Taoiseach stated this morning. However, in riposte I asked Shell whether, if we were going to go though more disturbances, upset and proceeding without the consent of a significant group of the population, it would be better to fundamentally re-evaluate the current transport and refinery decision. Would it be better to try to come up with a solution with which everybody would be happy so that at long last we could get our gas ashore. It seems a solution might be possible involving an onshore or foreshore solution. Could the 2006 Act, which the Minister for the Environment, Heritage and Local Government, Deputy Roche, is developing, and the Minister, Deputy Noel Dempsey's, attempt to protect existing infrastructural decisions that have been made provide the basis for fast-tracking an agreed decision on the refinery which would enable the project to go forward?

The Minister, Deputy Dempsey, spoke recently on a news programme about Deputy Ring's suggestion, which I made about a year ago, that the Taoiseach, with his famous mediation skills, might employ himself in trying to resolve this problem in north-west Mayo once and for all. The implication of what the Minister stated was that it would be more difficult than the St. Andrews talks and the final settlement in Northern Ireland. Although a remarkable statement, it points out that this problem is intractable, it needs face-to-face talks, and in the interests of the country it needs to be resolved as soon as possible.

Could this legislation, as amended, provide an opportunity? On the other hand, is the Minister stating it is critical to pass this because the current decisions on the pipeline and the refinery must be revisited under the 2006 Act? If that is the case, perhaps we should do so in the context of an agreed solution, which would resolve the dispute and ensure an interim gas supply that would meet 60% of the State's gas requirement for ten years.

Deputy Eamon Ryan may be wrong regarding the State being at the end of a pipeline from Russia one day. As the Taoiseach stated earlier, we may have our own gas supply for many decades, which will provide insurance while renewable energy sources are developed. We are at a critical juncture and the Minister is the man on the bridge. Perhaps he will advise us of the full implications of his amendments and whether they can be used positively to resolve the Corrib impasse.

Photo of Eamon RyanEamon Ryan (Dublin South, Green Party)
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This is a complex issue. Am I correct that the Minister is not amending the Planning and Development Act 2006 by inserting these provisions and that he is setting out conditions in this legislation? If I am incorrect, does the Gas Act 1976 need to be cited if he is amending separate legislation? I am concerned that if a separate body of legislation is being amended and the 1976 Act is not cited in it, it would be inappropriate.

The amendment proves the people of Rossport and elsewhere in Belmullet correct in that during the planning and development of the Corrib gas pipeline, the terminal building and the pipeline should not have been separated because they are inextricably connected as part of a single development. The manner in which they were separated added to the opposition that developed to everyone's dismay. What has happened in Rossport had done no one any good. It must be incredibly difficult for the local community to cope with what they are going through. The dispute has been a disaster for Shell and it has been bad for the economy and our image abroad. No one has won. The way in which the issue has been handled has also been bad for the Government.

One of the reasons it has gone awry is that the consultation and approval process for the pipeline was rushed in a manner that was not considerate of the local community and that bent over backwards to amend CPO legislation to allow Shell to get what it wanted immediately. That mistake has led to the situation today where 100 people are still protesting outside the site of the terminal building, which the Minister is desperately trying to separate from the pipeline, the original cause of understandable concern for Rossport residents because it will run close to their houses. This epitomises the problem. It was a mistake to separate the terminal and the pipeline and not to consider it as a single, integrated project. Anyone could understand that the pipeline's operation will be controlled by the terminal. If there is an accident on the pipeline, a physical response by management at the terminal will be required.

The legislation attempts to put a distance between the pipeline and the terminal and proposes a new consent process for the pipeline. Like Deputy Durkan, I welcome the work of Peter Cassells and I also welcome Shell's comments that it will examine a new pipeline route. The Minister must devise a consent process for a new route but the amendment proves that damage was done and the pipeline and the terminal building should have been integrated. The remit of the marine licence vetting body, which examined the original pipeline application, was to consider both the pipeline and the terminal. It had to take a holistic approach to the overall project and that is what we are untangling in this legislation, if my assessment is correct.

What will the new consent process involve? Will the Minister outline the timetable, conditions and appeals process and whether consultation will be undertaken with the local community regarding a revised pipeline route? What will be his Department's role? Will oral hearings be held? Will the EPA, An Bord Pleanála, the national infrastructure body or other bodies be involved? Will he outline how the consent process for this specific project, for which are we effectively legislating, will operate?

Jerry Cowley (Mayo, Independent)
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The debate shows the Government has learned nothing about the Corrib gas dispute and the people. Ministers could have learned so much about what is wrong with what is happening. The Government is serving the people with the filthy lucre, Shell, which has an agenda. The fact that the project is proceeding means that the country and my county are losing. Fifty permanent jobs will be created in the long term while no tax will be paid by Shell and its partners because of the write-off provided. What is the project about?

Deputy Eamon Ryan referred to project splitting, which the local community pointed out was Shell's game plan. In other words, the company tried to ensure the refinery would be built so that they could say they had to connect it to something. That is how the rest of the project was expected to come together. It was an ingenious and malicious way of fooling the people to secure the company's agenda. I am concerned that the Government is devising a way to ensure any decision it makes on the project is implemented without the consent of the people, no matter what. It is a way to write off the last vestiges of democracy where this issue is concerned and that is disappointing.

I reiterate what Independent Members who visited Bellanaboy stated last Monday. There is a way forward but Shell has never been prepared to examine all the options. Surveys conducted locally indicate that 90% of the people were in favour of what the protestors proposed. In the TG4 poll, 61% supported the Shell to Sea campaign but the Government has never considered the will of the people. Shell was granted permissions that have never been granted. A CPO was used on behalf of a company for the first time so that it could lay a pipeline on people's land.

The Minister's proposal is a further step to ensure his masters, Shell, will get whatever they want. A proposal was made earlier on the basis that there is more than one way to resolve this dispute. A way could be found to bring the gas ashore and everybody I know wants it brought ashore. The people are the salt of the earth and they feel what is proposed will be a great danger to their lives and health into the future whereas they will get little from the project except disappointment and the pollution of their environment. A 400-acre site will be completely taken over by a petrochemical industry, a point repeated in the local newspaper by Deputy Kenny, who believes this will be the centre for the petrochemical industry. It is the game plan that everything will come through this site.

When I visited Norway last year I was told this could not have happened there as local consent would have been required before a project proceeded. However, the Government seems intent on furthering Shell's agenda, despite the fact the project will provide only 50 permanent jobs. The security of supply argument is patent nonsense as the longest pipeline in the world, the Langeled pipeline, will come from Norway to supply gas to the world. The idea of security of supply is no longer valid. There are many other issues, for example, the tax take. Serious questions need to be asked with regard to why we are giving away our gas and oil for nothing before we get it.

The Minister should reconsider the proposed plan whereby the Government can act as mediators between Shell and Shell to Sea to try to achieve consent with regard to how the project might be brought forward. It should not try to devise ways of pushing the project through or continue to ride over local democracy. That is a recipe for disaster. The ball is in the Minister's court. I have clearly outlined my proposal, namely, that the work by Shell stops immediately, the protesters step back and do not protest, and there is a period in which the parties can sit down and work out this issue.

The Minister might respond by saying that Peter Cassells was in Mayo for discussions. However, at no time did Shell or the Government seriously consider the other options that could have ensured this project would mean something to the people of Mayo, and would not jeopardise health and safety. There were five areas where the refinery could have been located but the Minister has only considered the Shell option. That is wrong. He should reconsider the position and make a meaningful response instead of simply rubbishing anything to do with local consent or the wishes of the people.

I always thought government was about people and that the system was to serve the people. It is serving nobody. We are in a lose-lose position. The Minister can reverse this. The only one winning is Shell, which currently makes €3 million every hour.

The area is neglected. Deputy Durkan referred to what this might do for the county. It will do nothing. The best road in the area is between two bogs to facilitate Shell — it is called the Shell road. It is used as the haulage route to take peat from the Bellanaboy site to another site many kilometres away. An Bord Pleanála inspector, Kevin Moore, stated it was a refinery being built in the wrong place. That is the position. When the peat is removed, what is underneath is daub. Shell is trying to do something with this daub but major problems have arisen, whether the Minister knows it. The Minister should reconsider the position and consider local democracy for a change.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Some people have a funny idea of what constitutes local democracy. I heard a former Fine Gael councillor in the area refer to 100 people in the area opposing this project from a total population of 10,000.

Jerry Cowley (Mayo, Independent)
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What about the TG4 poll?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I do not want to get into a confrontation with the Deputy. If that is a definition of democracy, unfortunately, we will get nothing done in this country. We cannot get 100% approval from everybody, everywhere to everything.

Jerry Cowley (Mayo, Independent)
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It is the local population.

6:00 pm

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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The Deputy, as a sensible man, knows it is not feasible.

With regard to sitting down face to face, Shell gave its word it would not go onto the site for 18 months and it left the site for 18 months to try to facilitate the safety review, which was carried out by an independent organisation recognised by everybody except the Shell to Sea campaign as being independent and one of the top organisations for pipeline safety and gas safety. That organisation produced its report, gave its clearance and made its recommendations, all of which were accepted by the company, the Government, the Department and the technical advisory group in the Department, but not by Shell to Sea.

As Deputy Durkan noted, we then appointed a very decent man, well recognised for his conciliation and mediation capabilities and with no agendas. He is not even of the same political party as myself, and while I admit he is from the same county, that would not bias him one way or the other. He spent the best part of six or seven months speaking to people in the area and listening carefully to their views. Although he had no problem from a safety perspective he suggested, in order to meet the concerns of local people, that the pipeline should be moved. He made a number of other suggestions, all of which were accepted by the Government, Shell and all reasonable people, including people in the local community. Again, we got a "no" from Shell to Sea.

Deputy Cowley referred to a brilliant new initiative which Deputy Broughan stated he had put forward 12 months ago, and to which I responded by requesting and getting the approval of the Shell to Sea campaign with regard to the list of mediators. It approved that list and stated it had no difficulty with any of the mediators before I appointed Peter Cassells. He went to Mayo and agreed the terms of reference with Shell to Sea, the only thing Shell to Sea has agreed to in all of this. The terms of reference outlined by Peter Cassells were that the parties would sit down in face-to-face talks. Each party could begin with its position and nobody needed to compromise that position. Mr. Cassells would chair the talks to try to reach some kind of agreement. However, the Shell to Sea campaign refused to meet face to face with Shell.

Let us call a spade a spade. If people were interested in resolving this issue, it could have been resolved a long time ago but some people are not interested in reaching any kind of a resolution, despite having numerous opportunities to do so.

Local people have genuine concerns and fears which one can never fully overcome. I would not want to diminish those fears or suggest they are not real in some cases. However, I am satisfied that all of the safety issues have been addressed and that there is no need for concerns, although I fully accept they would continue to have such concerns. It is similar to a case where people are worried about living beside telephone masts, landfills or otherwise. People even have safety concerns about living close to gas pipelines that run under streets throughout the country.

In regard to the amendments they covered a large number of the issues we dealt with. Deputy Durkan made the point that part of the difficulty in this case was that set plans and procedures did not appear to be in place and that in future set plans and a clear sequencing of procedures should be in place to ensure people know exactly what is happening. There was a sequencing of procedures in this case, but I must accept the Deputy's point. As some six Acts had to be complied with, I accept that the sequencing was disparate in that sense. The Foreshore Acts, the Continental Shelf Act, the Gas Acts and so on had to be complied with and I accept the Deputy's point in that respect.

A point was raised by Deputies Durkan, Seán Ryan and Broughan regarding a change to the pipeline. If there was a new application elsewhere in regard to a pipeline, it would be dealt with under section 182(c) of the Planning and Development (Strategic Infrastructure) Act. It places obligations on An Bord Pleanála which are quite explicit and clear. They would also be clear to members of the public or a prospective developer. In response to a question raised by Deputy Seán Ryan, there are extensive rights to public participation in that process, which is outlined in section 182(c) of that Act. It allows for public and democratic participation.

With reference to points made by a number of Deputies, what we are proposing is not to retrospectively give approval or anything else that has happened in Bellanaboy in regard to the pipeline. It is merely to ensure that because of a technicality or a flaw in the critical infrastructure Act that when it is commenced people who already have permissions and consents will not have to go through the same procedure. It applies to transmission lines and it could apply to some of the other developments that might require an EIA. Therefore, what we are proposing is not to retrospectively approve anything that has happened. In the case where permission was granted to, say, the ESB for a transmission line on which work has not commenced, there is a possibility, I do not want to put it any stronger than that. Given the way the Act is worded, when it is commenced a case could be made that would mean all the consents granted previously for such a transmission line might have to be obtained again, and that is what we are trying to avoid in this legislation. It is not providing for retrospective sanction.

In regard to the technical query raised by Deputy Seán Ryan, the amendment is not being inserted into the planning Acts. His interpretation was correct in that respect. The amendment is part of this Bill. The 1976 Gas Act is defined under section 2 of this Bill. That covers the technical point raised by the Deputy.

I hope I have clarified other queries raised by Deputies Seán Ryan and Broughan regarding consents and what we are doing in this legislation as opposed to what they thought we might be doing.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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What about the sequencing of consents?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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The sequence of consents and planning is included and clearly laid out in section 182(c) of the Planning and Development (Strategic Infrastructure) Act.

As I have said in the Department and as one of the Deputies mentioned, there is a need, although it is not something that will be done this side of an election, to have a review of the different Acts, which include the Continental Shelf Act, the Foreshore Acts and so on, to consolidate the legislation into one Act. That would be a valuable exercise for the future.

Deputy Broughan raised a question on safety matters and proposed that they should be put in the hands of one body. On foot of the Advantica report and my Department's TAG report, I had hoped to insert sections into this Bill which would deal precisely with that safety issue, which the Deputy has raised on a number of occasions. Much work has taken place in this area, particularly in regard to making CER responsible for it. What is involved is probably a bit more complicated than we thought. We are continuing to work on it. If we can, we will try to produce amendments to the Bill before it goes through the Seanad and it would then have to come back to this House. If we cannot do that, we will work on a separate Bill to make sure such a measure is put in place.

I wish to clarify a point regarding CPOs and CAOs which Deputy Cowley and others mentioned on a number of occasions. The procedure in regard to CAOs and CPOs does not only apply to Shell. BGE always had the right to obtain CAOs and CPOs in pursuit of its business. The legal advice we got under EU directives etc. was that this was a power that could not be confined only to a semi-State company. It had to be available to all companies that were going to operate in the gas market. It is for that reason that the law had to be changed and not for any other conspiratorial reasons that some people like to put forward.

Many of the questions overlapped and I hope I have answered them all.

Photo of Séamus KirkSéamus Kirk (Louth, Fianna Fail)
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I call Deputy Cowley. The Bill has been recommitted in respect of certain amendments and I hope the Deputy will respect that we have only reached amendment No. 3 and there are many more to be dealt with.

Jerry Cowley (Mayo, Independent)
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We are on Committee Stage in respect of this amendment and I must reply to some of the Minister's comments. He has been acting as if he has no role in this matter, as if he were an innocent bystander and is not in any way responsible for this mess. I ask the Minister to engage, perhaps for the first time, with what is happening in Mayo. There was never any question of Shell considering in any serious way any other option. Shell could have done all this in a way that would have had the consent of local people.

More than 90% of local people support the protesters. According to the TG4 poll, 61% of people support the Shell to sea option, which is what the people of Mayo want. That is not the desire of just a few people, as some would like us to believe, but of the vast majority of the population of the area. A total of 66% support the stance of the Rossport five and in that context, I do not know how the Minister can claim this relates to only a few people. These are the Minister's people. This is the Minister's country and these are his subjects, as Minister, and his constituents in the broadest sense. I urge the Minister to listen to what they are saying. The protesters are there every day. It is not easy for them. They are getting up at 5 a.m. and turning out in their hundreds. Despite what people might like to think, this protest is achieving greater support. The numbers are higher now than they ever have been and will continue to be so because people feel hard done by.

The Minister referred to the fact that people would not talk to Shell. If he was put in jail for 94 days, he would not be too enamoured of the idea of talking to the company responsible. The Minister could talk to Shell and to the people of the area but he has never done that. He has never been to the area to see exactly what is happening but I advise him to come.

The Minister referred to the Advantica report, which examined the pipeline but not its location. The Minister knows well that the problem is not the pipeline but its location. Other reports on the issue have been published, including that prepared by the Centre for Public Inquiry and by Mr. Kevin Moore for An Bord Pleanála. The latter argued that the terminal is in the wrong place. The Minister cannot deny the existence of these reports. Even the Advantica report acknowledged that the peoples' fears were justified and that the gas pressure was too high and should be reduced. This is not about an ordinary pipeline, as the Minister likes to insinuate. The Minister has suggested that people are fussing about a Bord Gáis pipeline similar to those found in normal houses but this pipeline is an animal of an entirely different species. This is a pipeline carrying unprocessed gas at high pressure.

Advantica found that the pressure was too high and should be reduced. While this could be done using a beach valve, Advantica could not say it could be done with safety and as the Minister knows, things can go wrong. Depending on a beach valve to sort out that issue is something to which Advantica could not give a clean bill of health. Therefore, what the Minister says, with respect, is wrong.

This could have been done safely and in a way that would have resulted in a win-win situation. In fact, it can still be done in a positive manner and could mean so much for this country. It could mean jobs for the people of the area. It could mean that the people would not be condemned to uncertainty about the future. The issue is a 400 acre site which will destroy the entire area. For many reasons, not least the unacceptably high threat to the health and safety of the local population, there are better ways to progress this project. I have spoken about the alternatives that will secure full community consent. Such consent can be found very easily but the Minister is not even prepared to examine the alternatives. Considering the seriousness of the situation, the Minister's attitude has been far from perfect in terms of his responsibilities. He has been partisan and his attitude has been typical of the response of the Government from the outset. He behaves as if he is an innocent bystander with no responsibility in this area.

I could talk about this issue at length. Gas prices here have risen by 34% but the Corrib gas will not make one iota of difference. The reality is that we now have an international global gas supply. The argument regarding security of supply does not hold up. It is difficult to accept that we have such riches off our coast but they will not affect the price of gas here. In fact, the price will continue to rise and the people will have to continue to dig into their pockets, despite the rich supply of gas off the Irish coast.

I ask the Minister to re-examine the situation and to address the fact that the people for whom he is responsible have a very serious problem. This is not just an issue for a few people but for the vast majority of the population in the area. The Minister has a proposal in front of him and I ask him to give it due consideration and not to simply tear it up.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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I seek clarification from the Minister on a proposed new section of the Bill. The civil servants from the Department provided Deputies with very helpful notes on these amendments because they were introduced so late in the process. One of the notes on the proposed new section 7 states that:

these sections also provide a common sense safeguard against unnecessary delays or duplication of effort by developers which could potentially have an economic cost for the country as a whole. Specifically, these sections provide that where approval of the strategic gas infrastructure is already in place, it will definitely not be necessary for a developer to revisit the entire planning process for a gas processing terminal, should an alteration or modification of a pipeline, which forms a part of the overall infrastructure, become necessary.

Does this hold out the possibility that re-routing the pipeline or relocation of the terminal could be fast tracked in a way which would provide a solution to some of the difficulties to which Deputy Cowley referred? Would it enable us to finally find a way out of this impasse?

I recently received a detailed letter from Mr. Andy Pyle of Shell, as I am sure did other party spokespersons. In that letter he quotes from an opinion poll carried out in Mayo concerning the current development. On the issue of recommencing work on the project, 18% were "not in favour" and 12% were "not in favour at all". Thus, a total of 30% of those polled were unhappy about the recommencement in the context of the lack of an overall settlement. This information is coming from the managing director of Shell in Ireland, although he does not tell us which company conducted the poll. Nevertheless, he provides figures in his letter, in black and white, which indicate that a considerable number of people still have grave reservations about the pipeline route and the refinery. Mr. Pyle also stresses the potential for business development in the area and refers to the 700 jobs which would come on stream from early 2007. He refers to the 90 people currently working on the terminal site, 65 of whom are from Erris. Obviously jobs in the north-west of Mayo are very important and Mr. Pyle puts the case very strongly for going ahead, over the next 12 to 18 months, with a new pipeline route and building the terminal. However, he admits that a considerable number of people in County Mayo still have grave reservations about the project.

In that context, I seek clarification on the proposed new section 7. While my party is generally opposed to rushing through infrastructural developments against the democratic wishes of the people, in this instance, is there any way it could play a helpful role in resolving the matter? If, for example, there was a significant change to the current plan, could that be accommodated quickly within the planning process and the guidelines of the 2006 Act, as amended by this Act?

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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We must spend some time discussing this aspect. An issue like the tax take from the project is not relevant in this context because it is not a planning or health and safety issue.

Photo of Séamus KirkSéamus Kirk (Louth, Fianna Fail)
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It is important, in the context of the debate, to stress this legislation is not specifically about one project but is much wider in scope. While detailed references to current issues are understandable on Committee Stage, it is important to bear in mind the overall scope of the Bill. I ask Members to bear that in mind in their contributions.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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With no disrespect to the Chair, it is specific to this particular project. We could not possibly discuss a recommitted Bill without making reference to the project. I am quite sure the Minister is well aware it is going to be discussed. It is important we discuss it rather than shuffling to one side or the other. We should deal with the matter and get on with it.

A number of fundamental and ideological issues have arisen in this context. They are not planning issues. There are other ways and means for dealing with them. For example, if somebody has an objection relating to health and safety, it may be quite valid and a sincere objection. That person may well be correct, as I stated earlier. Over the years, all of us have been on one side or the other of planning applications where there were objectors with genuine and sincerely-held views.

Deputy Broughan mentioned that there will soon be development in Dublin the like of which would never have been heard of ten or 15 years ago. That will certainly change the appearance of the city. That is the way it is. Our job as public representatives is simply that we must support one side or the other. We make a judgment, and we may not be right. However, we make the judgment and stand up for what we think to the best of our ability.

When all is said and done, we all had cases which we lost. I lost some, and I am sure the Minister and Deputies Broughan and Cowley lost some. The point at this stage is the extent to which we then decide to pursue what we have already lost. We go to the courts. Provisions are made in the planning Acts for a person, after going to An Bord Pleanála, to go to the courts. A person can go to the High Court and on to the Supreme Court on a point of law. We have all been there before. The sad part is that a stage comes where one must consider that, having gone through the procedures and done the job, he or she may have failed. However, that person will have done the best he or she could.

In that kind of situation, what can be done? Do we remain steadfast and refuse to accept the decision of the courts? Do we refuse to accept the decision of the local authority, board etc.? This is why I argue we should have the proper sequence. There should be no doubt now or in future as to the sequence whereby the procedures are to be followed.

Incidentally, there was a time when I could give wise advice off the top of my head to people making an application for planning permission. I would have been right. Various people went to court and tested it, with decisions being made and new enactments being introduced. More cases would have been tested in court and built into case law. The result is the current situation.

This is not just relevant to this area. The Minister knows there is a growing element of concern in the energy sector, which is sincerely held. It will certainly create serious problems on the distribution of energy in the future. For example, there is much concern over networks, transmission lines, non-ionising radiation, ionising radiation and the proximity of lines to people.

I have heard arguments on these, as I am sure the Minister has. A person told me some time ago that the buzz in an electricity pylon or pole was caused by the electricity generated through it. As anybody would know, if two poles are put in the ground with wire strung from one to the other, a noise will be generated depending on wind direction and the location of the poles. That is simple. A song entitled "Wichita Lineman" referred to that.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Glen Campbell.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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The Chair will be glad to hear I am not going into the singing business.

Photo of Séamus KirkSéamus Kirk (Louth, Fianna Fail)
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I am delighted to hear that.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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So many things have been said, and once a situation gets increasingly polarised, it gets worse. I remember suggesting to people earlier in this debate that going to prison was not going to solve any problem. It exaggerates the difficulties and it creates more grievance.

I have been in a prison myself, so I know that. I have no wish to go back there, but it is no harm to have had the experience. One learns a certain amount. Everybody will say when outside and before a person goes to prison that a noble thing is being done and that people are behind that person, but when the door locks for the second time, and the double lock is clicked, the person will know he or she is alone for the first time. An anger and grievance will flow from that which was not there before. This situation is now complicated.

We have had the compromise of the alternative route. Questions have been raised, and there is an alteration to the environmental impact statement. There would have to be an alteration to the EIS if there was an alteration to the route. That is simple.

Whatever else goes with it, we must try to recognise that the resource is there. It is not in the same abundance as in Norway, for example, where there are huge resources of oil and gas reserves. That country also has significant resources of coal. It has many times the known reserves of coal under the sea. We are not necessarily comparing like with like. Norway is sitting atop that goldmine and it can afford to talk tough.

There are differences, and there is no sense in stating there are none. We should eliminate the ideological arguments, such as those relating to tax take. That will be dealt with further along this debate, as it should be. I have suggested that many times in the House.

Photo of Séamus KirkSéamus Kirk (Louth, Fianna Fail)
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It is taking the Deputy some time to get to the point.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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It should not be concluded, on the basis that it takes me a long time to get to the point, that I will not get to it. I have been here before.

In future, the licensing regime should have regard to sustainability, and it should be something we can all stand over. I met with exploration personnel, as I am sure everybody else did, and with Shell. They all agree that the licensing regime and taxation should be something we can all stand over. That would be very beneficial.

We have reached a juncture. I referred before to an important facet of the energy and telecommunications area. Many people have health concerns backed up to some extent by expert opinion, or which may be countered by expert opinion. That creates a problem. There is conflicting opinion from experts on both sides of an argument. What do we do? This is a point where we must reach a decision. Sadly and unfortunately, ordinary human beings must make a decision.

One particular case I remember related to a toxic incinerator in my area, which I opposed. I believe I was right to oppose it, although many people did not give me any credit for opposing it. This was despite my attending the oral hearing, making submissions and being questioned by counsel for the other side. Nobody told me afterwards I was great and had done a good job. I thought I did but that is neither here nor there. We were confronted by experts with conflicting views on both sides. We mere mortals had to come to a decision which we felt to be right and that decision has stood the test of time.

If the legislation does not resolve this problem now we will have more serious problems in the future. We will have problems with other projects such as transmission lines and radio masts, some of which already cause problems. The Minister's Department needs to make some response on health and safety, including medical evidence on the health hazards of living under or close to transmission lines or gas pipelines. The Minister needs to make a clear emphatic statement over which he can stand, to the effect that he is satisfied all the procedures have been followed so that people can rest easily. If he cannot do that, we will visit this problem again and again.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I do not want to rehash the points I made in my previous contribution. Deputy Cowley accused me of trying to make out I am an innocent bystander but I do not know where he gets that from.

Jerry Cowley (Mayo, Independent)
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It is because of the Minister's inactivity.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Just because I do not row in behind the Deputy does not mean I am sitting on my hands. I have statutory functions which I have discharged. I have gone beyond them to try to meet the concerns that people had locally.

Jerry Cowley (Mayo, Independent)
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I disagree.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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The Deputy is entitled to disagree but I am also entitled to put on record that he is wrong. I went out of my way to listen to the concerns people had and to meet those concerns.

Jerry Cowley (Mayo, Independent)
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Did the Minister meet the people? He did not.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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The fact that Members on the Opposition benches do not acknowledge it is something I cannot do anything about. Deputy Cowley can make all sorts of allegations inside and outside the House but I have a statutory function over the consents and statutory duties to discharge as a Minister, which I have done. I have gone beyond that to try to meet people's concerns. There was no need for me to engage the services of a mediator or to listen to one. I did not need to commission a safety review as I was satisfied with the safety position from my reading of the files.

I listened to people, some of whom were reasonable while others, I have since discovered, were far from reasonable, of which fact we all have evidence. I tried to meet people's concerns through the safety review and the mediation process. The people who do not want to hear do not hear. The people who now talk about compromising and coming up with a brilliant new solution to the problem are the same people who previously rejected every effort to meet their concerns. The Deputy talks about reports but I am not greatly impressed by the report from CPI on the matter, or on any other matter it investigated.

Jerry Cowley (Mayo, Independent)
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Nor is the Minister impressed by any other report that states the opposite of what he wants to hear.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Nevertheless, we paid CPI the courtesy of allowing Advantica to analyse its report in detail. The response is at the back of the Advantica report, which Deputy Cowley appears not to have seen. He might read it and see why I did not, and still do not, think much of the CPI report.

Jerry Cowley (Mayo, Independent)
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I read it today——

Photo of Séamus KirkSéamus Kirk (Louth, Fianna Fail)
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Please allow the Minister to conclude.

Jerry Cowley (Mayo, Independent)
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What about Mr. Kevin Moore's report?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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Mr. Moore's report was on the initial planning application to An Bord Pleanála, which considered it very carefully and decided not to accept its recommendation. It was fully considered. The only people who seem to think the CPI view should be considered are those who constantly say "No" to everybody else.

Deputy Durkan and Deputy Broughan raised a question, which Deputy Broughan tried to clarify, on the effect of this amendment. If the Act was commenced as it stands there is a danger, which I will not overstate, that all the consents for this project, for transmission lines and other State planning applications requiring approval would fall. This amendment removes that doubt.

The second part of the Deputy's question was what would happen if Shell wanted to move the terminal, the pipeline or the whole installation. That would be dealt with under the new procedures in the Planning and Development (Strategic Infrastructure) Act 2006. The Deputy asked whether there would be a speedy way of dealing with it. I am not sure how speedy it would be but that is the purpose of the Act and such an issue would be dealt with under that Act. It would not have to go through all the previous procedures that were required.

Deputy Cowley quoted from a TG4 poll and Deputy Broughan has details of a poll Shell also carried out in that area.

Jerry Cowley (Mayo, Independent)
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The Minister will believe Shell anyway. It is disgraceful.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I understand Millward Brown IMS carried out that poll. It showed that 70% of the people are in favour of Shell recommencing work on the project immediately.

Jerry Cowley (Mayo, Independent)
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The Minister will buy anything.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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It was a scientifically conducted poll.

Jerry Cowley (Mayo, Independent)
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Like the TG4 poll.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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There is a minority of people who do not want it.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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A large minority.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I acknowledge there is a minority of people who do not want it.

Jerry Cowley (Mayo, Independent)
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The majority do not want it.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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A minority is a minority.

Jerry Cowley (Mayo, Independent)
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Why does the Minister not come to meet the people?

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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No matter what I or anybody else does we will not change those people. It makes sense for Shell to proceed with the project. If Shell decides it wants to change the project or terminate it it will have to be dealt with under a new consent process.

Amendment put.

The Dail Divided:

For the motion: 69 (Noel Ahern, Barry Andrews, Seán Ardagh, Niall Blaney, Johnny Brady, Martin Brady, Séamus Brennan, John Browne, Joe Callanan, Ivor Callely, Pat Carey, John Carty, Michael J Collins, Mary Coughlan, Brian Cowen, John Cregan, Martin Cullen, John Curran, Noel Davern, Noel Dempsey, Tony Dempsey, John Dennehy, Jimmy Devins, John Ellis, Frank Fahey, Michael Finneran, Seán Fleming, Mildred Fox, Pat Gallagher, Jim Glennon, Noel Grealish, Mary Hanafin, Mary Harney, Seán Haughey, Máire Hoctor, Joe Jacob, Cecilia Keaveney, Billy Kelleher, Séamus Kirk, Tom Kitt, Michael McDowell, Tom McEllistrim, John Moloney, Donal Moynihan, Michael Moynihan, Michael Mulcahy, M J Nolan, Éamon Ó Cuív, Seán Ó Fearghaíl, Charlie O'Connor, Willie O'Dea, Liz O'Donnell, John O'Donoghue, Denis O'Donovan, Noel O'Flynn, Fiona O'Malley, Tim O'Malley, Tom Parlon, Peter Power, Seán Power, Dick Roche, Mae Sexton, Brendan Smith, Michael Smith, Dan Wallace, Joe Walsh, Ollie Wilkinson, Michael Woods, G V Wright)

Against the motion: 29 (Dan Boyle, James Breen, Tommy Broughan, Joan Burton, Paudge Connolly, Jerry Cowley, Martin Ferris, Tony Gregory, Séamus Healy, Michael D Higgins, Brendan Howlin, Finian McGrath, Paddy McHugh, Liz McManus, Arthur Morgan, Catherine Murphy, Caoimhghín Ó Caoláin, Brian O'Shea, Jan O'Sullivan, Séamus Pattison, Willie Penrose, Pat Rabbitte, Eamon Ryan, Seán Ryan, Trevor Sargent, Joe Sherlock, Emmet Stagg, Mary Upton, Jack Wall)

Tellers: Tá, Deputies Kitt and Kelleher; Níl, Deputies Gregory and Cowley.

Amendment declared carried.

Photo of Pat CareyPat Carey (Dublin North West, Fianna Fail)
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Amendments Nos. 4 and 106 to 113, inclusive, will be discussed together.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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I move amendment No. 4:

In page 3, line 9, before "AND" to insert the following:

", TO PROVIDE FOR THE TREATMENT OF LANDS AFFECTED BY MINES AND FORMER MINES BY THE REHABILITATION OF SUCH LANDS AND FOR THE COMPULSORY ACQUISITION OF LANDS FOR THE PURPOSES OF SUCH REHABILITATION".

The proposed amendments are required to give effect to a Government decision of 28 June 2005. It was decided the State would assume responsibility for the rehabilitation of former mine sites at Silvermines, County Tipperary at an estimated cost of €10.6 million over a four-year period. North Tipperary County Council has agreed to undertake the rehabilitation works operating as an agent on behalf of the Minister for Communications, Marine and Natural Resources. Funding and overall responsibility for the project remain with the Minister.

The purpose of the proposed amendments is to give the Minister, and his or her agents, powers to prepare and revise a mine remediation plan and allow for consultation with stakeholders on any mine plan. The Minister will have the power to advance funds from mine remediation plans, appoint a local authority as his or her agent to carry out a mine rehabilitation plan and give the Minister, or his or her agent, powers of entry to relevant lands to carry out or implement a mine rehabilitation plan. The Minister, and his or her agents, will have the power to compulsorily acquire lands for rehabilitation and discretionary power to recover State expenditure on rehabilitated lands.

Amendment No. 4 reflects the changes to the Bill brought about by these provisions. They have been long sought and will be welcomed by Members on all sides of the House.

Photo of Máire HoctorMáire Hoctor (Tipperary North, Fianna Fail)
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Hear, hear.

Photo of Noel DempseyNoel Dempsey (Minister, Department of Communications, Marine and Natural Resources; Meath, Fianna Fail)
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It has been a persistent problem for a long time. Deputies Hoctor and Michael Smith have consistently requested me to resolve the matter.

7:00 pm

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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I welcome the amendment as it merits the action taken by the Minister. The long-standing problem at Silvermines was debated on Committee Stage. The mining there was one matter. The aftermath was another.

The proposed legislation is an interim measure pending enactment of a comprehensive minerals development Bill. Apropos of the earlier debate on mining regimes and mineral rights, a minerals development Bill must be urgently introduced to the House. For many years, even before I was appointed Fine Gael spokesperson on communications and natural resources, I took an interest in this matter. I have been intrigued by how mining regimes work and the technological advances made in the area. There may be places with mineral resources that we do not know we have. It is important parameters for minerals development are laid down. The minerals development Bill must be fair, even-handed, sustainable and above board.

Progress reported: Committee to sit again.