David Stanton (Cork East, Fine Gael)
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Question 95: To ask the Minister for Communications, Energy and Natural Resources his views on supporting the micro-generation of electricity; and if he will make a statement on the matter. [3335/10]

Eamon Ryan (Dublin South, Green Party)
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The development of electricity micro-generation is a key priority as part of the overall objective to deliver a more distributed and sustainable generation and network system and to reduce energy costs and carbon emissions. In February 2009, I launched the Micro Generation Programme, which is being operated by ESB Customer Supply and supported by ESB Networks. The programme has the potential to provide up to 4,000 domestic customers investing in micro-scale projects with a financial payment for electricity exported back to the grid. The ESB advises that 189 customers have signed up for the scheme to date. I have asked my Department to review the level of take-up with ESB with a view to identifying and addressing any barriers to participation.

The microgeneration programme also provides for two-way metering, to be installed without additional charge to the customer. The electricity producer is paid a price of 19 cent per kilowatt-hour, which will help to offset the start up costs. The eligible micro technologies include wind, solar and hydro as well as combined heat and power.

It is the case that micro-scale electricity production will benefit the participating customers upfront by allowing them to replace retail rate electricity with their own cheaper generated electricity. Sustainable Energy Ireland's microgeneration pilot programme currently involves 42 projects and a range of technologies including wind, solar PV and micro-hydro. Twenty-seven wind turbines and 14 solar photovoltaic installations have been commissioned and initial results are expected later this year. The pilot programme is being carried out in conjunction with key stakeholders and is designed to assess market potential, technologies, economics and emissions savings. The field trials are also addressing grid connection and technical standards to ensure the power security, safety and quality of installations.

The national smart metering pilot programme is proceeding in parallel with the current microgeneration initiative and there are important links between the two. The data gathered from the interval meters being used in a microgeneration scheme will provide important information on import and export of electricity. This will feed into the analysis of electricity use being carried out in the smart metering pilot programme. In turn, the findings of the smart metering programme will inform the development of a long-term microgeneration strategy. Other initiatives designed to facilitate the development of microgeneration include the 2008 planning and development regulations which provide for planning permission exemptions for certain categories of microgeneration.

Additional information not supplied on the floor of the House.

The purchase of wind turbines by companies is now eligible for accelerated capital allowances under the Finance Acts. To be eligible for the accelerated capital allowance, the turbines must comply with the relevant eligibility criteria. In particular, they must be for the purpose of generation of electricity primarily for on-site use by the company. Other developments in support of microgeneration include the streamlining of licensing arrangements for compliant small scale generators and the adoption of a new standard for connection of domestic generators to the distribution system.

An SEI study completed last year points to a significant number of barriers to the deployment of micro generation which need to be addressed. These include: the need for further work on the impact of deployment of large numbers of micro-generators on the existing electricity distribution system; the immaturity of some of the technologies; the need for equipment standards, installation practices and codes to ensure appropriate safety and efficiency standards are in place; and the need to adopt the present administrative infrastructure for customer metering and billing.

David Stanton (Cork East, Fine Gael)
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I thank the Minister for his reply. Is he disappointed at the take-up of 189 that signed up, from a target number of 4,000? With regard to the planning the Minister mentioned, are there difficulties in getting connections at the 10.8 kilowatt level? No planning is required up to 11 kilowatts but I am told there are problems with the connection at 10.8 kilowatts. He might provide information on that.

Concerning the tariff of 19 cents to which the Minister referred, is it true this applies only to the first 3,000 kilowatts generated per annum? Does the Minister propose to raise that limit?

Eamon Ryan (Dublin South, Green Party)
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To answer directly, yes. We need much larger numbers and we need those 4,000 smart meters to be availed of as soon as possible. That is why I asked the Department to go back to the ESB and others to find out why the scheme is not going as quickly as we wanted. If necessary we will change the regulations to make it happen. While one should be careful, one does not want to create a static market while waiting for an alternative system. It is a matter of looking at the current rules to see if they can be adapted, not in a way that would disrupt the market but in order to make the process easier. We must do this and there is a variety of ways by which we can do it. Microgeneration is a crucial element within an overall distributed electricity generation mix which we must develop.

Simon Coveney (Cork South Central, Fine Gael)
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I would like to hear answers to Deputy Stanton's questions because we did not receive them in the Minister's reply. Going back to the ESB to ask it why there has not been more take-up on this scheme is not necessarily the way forward. For a start, it is not in the interests of the ESB to facilitate large-scale decentralisation of power generation.

I reiterate a specific question that was asked already. The key to building a successful microgeneration industry in other countries that have been successful - Germany is probably the best example but France and, more recently, Britain can be included - is the level of export tariff set. A tariff of 19 cent per kilowatt hour for the first 3,000 units is significantly less than the tariff made available in other countries to kickstart this industry and is in spite of the fact that Ireland has much better climatic conditions for microgeneration, in particular wind, but also bio-mass generation. Will the Minister review the rate of 19 cent per kilowatt hour for the first 3,000 units with a view to raising it for a period? It would significantly kickstart this industry which could employ a great number of people.

David Stanton (Cork East, Fine Gael)
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My question concerned the 3,000 kilowatt per annum limit. Will the Minister examine that limit and either get rid of it or increase it substantially? Can he throw any light on reports that there are difficulties in connecting to the network at the higher level of up to 11 kilowatts, specifically the 10.8 generating plant? Has he any plans to move beyond the ESB to include Bord Gáis, Airtricity and others?

Eamon Ryan (Dublin South, Green Party)
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Deputy Stanton is correct. This issue concerns not only the ESB but a number of different supply companies. In fairness to the ESB, it came forward with its offer of 10 cent premium for the first 3,000 kilowatt hours. There is a variety of ways in which this can be done. One lesson we must learn from the success in other countries is that what is not needed is a stop-start approach. That sometimes bedevils some of the very high initial feeds in fixed price systems which cannot be maintained. That is not a clever method either. We must learn this from other countries that have worked in this area.

With regard to whether there is a difficulty concerning the 11 kilowatt level, that is one of the benefits of doing the SEI study. We have grant-aided up to approximately 40% of those 42 projects in order to get answers to such technical questions regarding safety, height, power output and installation systems. The right way to do it is to answer those questions by proper surveying machines on the ground. This is all being done with the purpose of our having an environment that can deploy microgeneration. It has taken time but we will get there. Microgeneration will happen, not only in households but on Irish farms, and in rural areas where the power supply is more significant, available and more consistent, it will have a significant role to play.

We always said we would take this in stages, the first being the 1-11 kilowatt plant but we also recognise we need to work back down, from some of the large auto generators within industry towards the type of farming or small business environment that can use the power supplied. It is work in progress. More needs to be done and I am committed to it.

Simon Coveney (Cork South Central, Fine Gael)
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Question 96: To ask the Minister for Communications, Energy and Natural Resources his plans to introduce legislation to facilitate the development of offshore wind energy; the timescale for same. [3358/10]

Eamon Ryan (Dublin South, Green Party)
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I intend to bring forward shortly a policy blueprint for the development of the renewable energy offshore resource encompassing ocean and wind energy. The national offshore renewable energy plan will take account of the significant impetus being given to offshore renewable energy at European level. Our work as part of the North Seas countries offshore initiative together with the forthcoming EU Strategic Energy Review will focus on the priority interconnection needs across member states. The national plan will also reflect ongoing co-operation with the UK and Northern Ireland through the ISLES project and under the British-Irish Council. Critical to delivery of the renewable energy development plan will be the creation of a fit-for-purpose planning regime for the resource.

Following the enactment of the Foreshore and Dumping at Sea (Amendment) Act 2009, responsibility for certain foreshore functions transferred to the Minister for the Environment, Heritage and Local Government with effect from 15 January 2010. This includes all energy-related developments on the foreshore, including oil, gas, wind, wave and tidal energy.

My colleague, the Minister for the Environment, Heritage and Local Government, Deputy Gormley, has made clear that he will introduce legislative change aimed at better integrating the foreshore consent processes with the planning processes under the Planning Acts. This will include the new planning regime for offshore renewable energy developments, taking account of the forthcoming plan. My Department is working closely with the Department of the Environment, Heritage and Local Government on the new regime that will reflect national and EU renewable energy objectives while taking account of the interests of stakeholders in the marine resource.

Both Departments will work with the Department of Finance, the Attorney General's office and other relevant Departments, as well as Eirgrid and the Commission for Energy Regulation and Sustainable Energy Ireland, in delivery of the new regime. A strategic environmental assessment, SEA, of Irish offshore renewable energy resources is being undertaken by Sustainable Energy Ireland at my Department's request. This will complement and inform the design of the plan and the new offshore framework. The SEA process is being overseen by a steering group comprising my Department, the Department of the Environment, Heritage, local government, the SEI and the Marine Institute.

Under the EU Renewables Directive, Ireland along with all member states, will submit a national renewable energy action plan by June 2010. This will set out the plans to meet our national renewable energy target and will include medium-term plans to develop an offshore grid to facilitate the export of renewable electricity. I will also meet my UK ministerial colleague shortly in this regard.

Simon Coveney (Cork South Central, Fine Gael)
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I am glad the Minister is thinking in terms of the super grid that was proposed in the past by people such as Eddie O'Connor and others, whereby countries would agree to work together to build very large scale offshore generation capacity that would interconnect electricity grids of different European countries with a view to providing green energy and security of supply. I encourage the Minister to progress this, while obviously taking into account the potential cost to the Exchequer and to energy users and endeavouring to keep down that cost.

My specific intent with this question relates to the Joint Committee on Climate Change and Energy Security, chaired by Deputy Seán Barrett. Deputies McManus, Coonan and I are members of that committee. We spent a great deal of time putting together new legislation of which the Minister is aware. It would facilitate the fast tracking of a planning process for significant offshore energy projects. Has the Minister looked at that legislation? Will he use it as the basis for new legislation that might reduce the period from time of application to time of building? There is enormous frustration at present among those in the industry concerning the length of time it takes to get permission to build offshore. 4 o'clock

Eamon Ryan (Dublin South, Green Party)
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I am aware of the legislation to which the Deputy refers and I am of the view it will strongly inform the new planning system for the development of offshore renewable energy projects in respect of which we will be obliged to legislate. The Minister for the Environment, Heritage and Local Government has primary responsibility for the delivery of the new planning system to which I refer.

I take this opportunity to suggest that I could again go before the Joint Committee on Climate Change and Energy Security in order to engage in specific discussions on offshore development. This would enable us to try to arrive at a common vision with regard to what is our purpose. This is a long-term project and it will not be completed within a two to five-year timeframe. As a result, a long-term vision will be required. If the political system in this country gives a strong direction, both at home and in Europe, to the effect that it is committed to this project, that it will build the type of interconnection and offshore infrastructure - in respect of which EirGrid is already carrying out analysis and is working on delivering - required and that it will enter into negotiations with the UK, French and other governments, it will be possible to establish an exporting industry here for the long term.

We have a comparative advantage, particularly in the context of our ocean energy resource, and I am of the view that we can obtain European support. I attended the Council of Ministers meeting in Seville last week and I argued in favour of such support being provided. There is potential for us to attract EU support in respect of the type of project in which we are engaged. It would serve the country well if we could come to a political agreement on the broad, long-term approach to be taken. If such agreement is forthcoming, it will then be a matter of putting in place the necessary planning legislation.

Liz McManus (Wicklow, Labour)
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A long-term approach has certainly been adopted up to now, particularly in view of the fact that it has taken two years to transfer responsibility for this matter from one Department to another. Does the Minister not accept that the type of goodwill to which he refers already exists? I do not imagine that any Member would oppose the possibility of his again coming before the committee.

The problem in respect of this matter relates to the difficulties involved in modernising our legislation, which is a ministerial responsibility. Does the Minister not accept that he must set down certain timelines? Does he further accept that this will not be easy, particularly when it is not his Department but rather the Department of the Environment, Heritage and Local Government that has responsibility in this regard? That is the precise reason the Joint Committee on Climate Change and Energy Security produced legislation in which it is suggested that there be a one-stop shop and that the process be streamlined in order that it might deliver the goods.

It is fine to refer to the long term and I am sure this goes down well at EU meetings. However, that is not my primary concern nor, I am sure, that of Deputy Coveney. It would be possible for the Minister to indicate now, and to everyone's satisfaction, what will be the timeline in respect of when the legislation will be delivered.

What is the Minister's view on the ESRI report, which essentially indicates that we have enough potential in respect of producing onshore wind energy and it would not be necessary to move into the area of offshore production? That is quite a significant conclusion for an eminent body such as the ESRI to reach. Will the Minister comment on this matter and outline the Government's position in respect of it?

Eamon Ryan (Dublin South, Green Party)
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I am glad Deputy McManus raised this issue. I am of the view that goodwill and co-ordination at a political level are important because a consensus does not exist in certain other quarters. In my opinion, the ESRI's report does not take account of the long-term opportunity that exists. That body did not consider this industry as an exporting one. It may have examined this matter on a purely domestic basis and failed to see the bigger picture in the context of what is happening. If we followed such advice, we would miss the opportunity that exists. It is for this reason we must provide a strong signal to the effect that this is the course we will take.

I referred to a long-term approach but I also believe this matter to be of immediate importance. The issue of whether the European Union should develop these grids will be one of the items on the agenda for the Heads of Government meeting to take place in the spring. We are obliged to make our submission, as part of our renewable energy plan, by June. It will have to be pretty much agreed and set out by that point. If we are to obtain EU funding under the next round in 2014 - approximately the right date in the context of when construction on some of these grid networks should commence - it will be necessary to obtain European buy-in in 2011. This means that we must present our submission this year. To do so, we must be as confident as possible that, regardless of who is in power, we are going to pursue the approach to which I refer.