Dáil debates

Wednesday, 23 June 2021

Saincheisteanna Tráthúla - Topical Issue Debate

Just Transition Fund

9:42 am

Photo of Joe FlahertyJoe Flaherty (Longford-Westmeath, Fianna Fail)
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The Minister will be very aware the midlands region is set to shoulder the bulk of responsibility as we aim to reach zero carbon emissions by 2030. We have seen the closure of Bord na Móna and ESB operations and we were sold the specifications of an €11 million just transition programme as the catalyst for revitalising the region. Unfortunately, people in the region are currently disillusioned and worried the just transition process is simply coming apart at the seams.

Almost a year on, just €116,000 in funding has been paid out to community groups and business ventures. One example would be the Lough Ree Access For All project, which seeks to employ and train former Bord na Móna workers and involve them in an exciting new project that will provide access to the River Shannon and Lough Ree for the disability community. The group was awarded €472,000 under strand two of the just transition programme, but drawing down this funding has proved challenging in the extreme. This and many other entities approved for funding are also facing the potential of a 30% increase in construction costs following on from their applications. There is a real risk that up to 30 of the original job creation projects deemed eligible for just transition funding at the end of last year are now unlikely to go ahead because they simply cannot meet the matching funding demands of 50%, they cannot satisfy EU state aid rules in some areas or they will struggle to finance escalating construction costs.

We have not yet seen a single job created as a direct result of the just transition programme. With momentum now gathering behind the climate action Bill, there is a real fear our region is set to carry the greatest burden, pay the greatest price and suffer most in this process. The expected support package is unfolding at a snail's pace and there are genuine fears and concerns locally as to whether the funding will ever flow while escalating construction costs are punching holes in the €11 million fund.

There is frustration too that the midlands regional transitional theme lacks any real clout. That is something we need to examine as a matter of urgency. At this stage it should be reasonable to expect we would be seeing the genesis of new job creation opportunities for the region but this simply is not the case. There is a growing fear and concern the ESB, in particular, has been let off the hook at this stage. I would ask the Department, Bord na Móna and the ESB to assess the just transition programme in tandem with the midlands regional theme as a matter of urgency. We urgently need to streamline the drawdown process for approved groups while the ESB must return to the table with additional funding to revise this flagging programme.

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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I welcome the opportunity to respond to the question posed in the Deputy’s Topical Issue matter and to acknowledge the genuine concerns of people in the midlands about the transition, the major changes in the economy and the funding that is there for it. In the programme for Government we copper-fastened support targeted towards the midlands to support a just transition. There is a major amount of money involved in funding that, but as in any project which involves hundreds of millions in funding over a decade there is a ramp-up period, a period of time when projects have to be examined and approved before the funding starts to flow. I acknowledge the frustration with that, but I want to say it is there and it is coming.

I welcome the opportunity to set out the actions which are being taken by the Government in response to the announcement of the closure of the peat-fuelled power stations and the end of peat harvesting by Bord na Móna. The Government is committed to a just transition in the midlands region and has dedicated significant funding to supporting workers, companies and communities affected by the closure of the two power stations at Lanesborough and Shannonbridge. The Government appointed Kieran Mulvey as Just Transition Commissioner in November 2019 to assist the midlands region in the transition process. The commissioner has made a series of recommendations to Government on taking forward the Government’s just transition response in the midlands.

A significant package of supports worth €177 million has been put in place in the midlands to ensure the transition away from peat-fuelled power is indeed just. This includes €20 million for the midlands retrofitting project; €108 million for the Bord na Móna peatlands restoration project; the just transition fund, with up to €30 million available for approved projects; and €19 million for the National Parks and Wildlife Service peatlands restoration scheme. The Department of the Environment, Climate and Communications approved €108 million for Bord na Móna’s large-scale peatlands restoration project on 24 November 2020. The plan will protect the storage of 100 million tonnes of carbon, sequester 3.2 million tonnes of carbon out to 2050, enhance biodiversity and deliver significant benefits and contribute to Ireland’s target of being carbon-neutral by 2050.

The scheme will encompass 33,000 ha of Bord na Móna peatlands previously harvested for peat extraction for electricity generation. The Government funding, which will come from the climate action fund, will be bolstered by an €18 million investment from Bord na Móna, which is committed to a brown to green transition.

The National Parks and Wildlife Service peatlands scheme received funding of €5 million in 2020, supported from the carbon tax fund, which enabled the commencement of peatland restoration measures on almost 1,900 ha of raised bog on up to nine raised bog designated sites in the midlands region, along with the development of drainage management plans and other peatland management and conservation measures. Bord na Móna has been contracted to manage this programme. Work has commenced on this project and an additional €14 million in 2021 has been allocated to the programme for the restoration of a further 2,500 ha of protected raised bog, together with other peatlands conservation measures. These projects will support a just transition by avoiding job losses based in the Offaly works and across the midlands and by creating opportunities for skilled employment in these areas into the future.

The just transition fund was established to respond to the closures and to support the transition away from employment in peat harvesting in the affected communities in the region. Eight of the most affected counties in the region were eligible to submit funding applications to the just transition fund. The Government has announced provisional funding offers totalling almost €30 million to some 60 projects throughout the region for projects from the private sector, local authorities and communities to create a strong, green and sustainable economy. These projects will contribute to making the midlands a more attractive and sustainable place to work. Of these, 16 projects are already up and running in the midlands with support from the just transition fund since last September. These projects have created 28 full-time jobs and will also support a further 175 indirect jobs. A further 13 projects, with funding of €6.5 million to be provided by the just transition fund and additional funding of almost €1 million, have now entered into a grant agreement with the Department and further projects will conclude grant agreements in the coming weeks. The Department has worked directly with projects, particularly smaller-scale projects and those from community groups, that received provisional offers to support them in the process of finalising grant agreements, while ensuring all projects are able to meet the fund rules.

9:52 am

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I thank the Minister of State. Is there a copy of the reply available?

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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Yes.

Photo of Joe FlahertyJoe Flaherty (Longford-Westmeath, Fianna Fail)
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I thank the Minister of State. I believe that the Minister of State will agree it is critical that we get just transition right for the midlands region. It is also critically important that the ESB is not allowed off the hook. It was extremely disappointing to hear the ESB's announcement last week that it plans to proceed with the demolition of the two power stations. There was a genuine expectation in both communities that the buildings could be retained and repurposed for alternative energy uses. A glib ESB statement said that "having considered commercial and climate action realities in particular, no viable solution was found to repurpose the plants." The region is growing sceptical about the ESB's role in this process. The company has made much out of its €5 million contribution to the just transition programme and yet we are hearing that it is already seeking this money back via a refund from the energy regulator. There is a real fear that the ESB never properly scoped alternative uses for the power stations and that it is in fact more financially beneficial for the ESB to proceed with the demolition plans for the two stations, and to seek compensation afterwards through the regulator.

As the just transition process flounders, we are seeing an increase in imports of replacement peat and fuel products, while the horticultural peat production sector faces termination in Ireland. It is now critically important that the ESB liaises with the midlands transition groups and the local groups to explain properly the rationale for the demolition of these two buildings, and to also scope adequately any local proposals for alternative uses for the facilities.

The company must return to the table with a compensation package, commensurate with the midlands' massive role in energy production over the past 60 years: €800,000 per decade, or just €1,600 per week, is derisory, and the ESB must be held to account. I encourage the Minister of State and the team in the Department to go back to the ESB once again and engage. The ESB simply cannot be left off the hook with this derisory compensation.

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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The Deputy is right that the ESB has a key role, and it is important that my Department engages and continues to engage with the ESB on the future of the midlands.

I will address specifically the Shannonbridge and Lanesborough power plants and what their future is. The just transition commissioner made a recommendation in the first progress report in May 2020 that a study be undertaken on the future potential of ESB power stations at Lanesborough and Shannonbridge for the establishment of a dedicated energy hub in the midlands. This is a commitment in the programme for Government and we take that seriously. The ESB has been deeply engaged with my Department, the result of which is a planning application to be lodged shortly to develop additional energy services at these two sites. These will include synchronous condensers and energy storage capabilities at both locations. This type of energy infrastructure is key for the success of renewable energy projects in the area. Offaly has always been a centre in Ireland for energy, whether it was Bord na Móna or ESB. Now it is wind power and solar power, both of which need that balancing technology to allow stable power to be given to the grid or into energy storage and so on. I believe there will be a bright and hopeful future for the midlands, and especially in areas like Offaly where there have been worrying closures of plants. It is a difficult time to go through a transition. The Government is absolutely committed to making sure there is a just transition, sufficient funding and investment, retraining, bog restoration, retrofitting, support for community projects and State strategic support to allow this region to transition from its successful past to a successful future.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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That concludes Topical Issue matters. We are a little ahead of schedule, so we will take a sos beag until 10 a.m.

Sitting suspended at 9.56 a.m. and resumed at 10 a.m.