Dáil debates

Tuesday, 24 May 2022

Saincheisteanna Tráthúla - Topical Issue Debate

Energy Policy

10:50 pm

Photo of David StantonDavid Stanton (Cork East, Fine Gael)
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I thank the Office of the Ceann Comhairle for selecting this issue, and the Minister of State, Deputy Ossian Smyth, for being here to respond on it.

Last Friday, I attended a seminar in Cobh organised by Cobh and Harbour Chamber. There were some serious people there representing the energy sector. The focus was on renewables and the great potential that exists in Cork Harbour in particular for renewables such as offshore wind and so forth. Several of those present expressed concern, however, in respect of the State energy security framework into the future, and next winter in particular. Ireland's natural gas supply is dependent on imports from a single source in the UK, namely, Moffat, in Scotland, while the Corrib gas field, which is depleting, supplies approximately one quarter of the State's annual needs. We now have a serious situation in Europe, with a challenge to gas supplies. The national energy security framework, published in April 2022, states:

[I]t should be noted that the UK’s indigenous production is decreasing, resulting in increased imports of liquified natural gas. In 2020, Russia supplied over 40% of the EU’s natural gas. Reduced supplies of gas from Russia could have knock on effects for Ireland.

If there are pressures on the UK, there could be a domino effect. We are at the end of the pipeline. What are the contingency plans for next winter if the gas supply reduces? If that happens, electricity generation, heating and power supply generally will be hit. What are the contingencies in that regard?

I have tabled parliamentary questions in respect of floating storage regasification units. Other countries are using them. They are importing liquefied natural gas, LNG. The response to the parliamentary questions I tabled seems to mix up fracked gas with LNG. Is analysis being carried out at the moment in respect of floating storage regasification units? It is one answer here. There may be another answer that I am missing. If that pipeline from Moffat is under pressure, however, we will be in serious trouble and people will suffer. It is bad enough having very high prices; it will be something different altogether if we do not have gas at all. This is very serious.

I know that a review is ongoing and will be delivered in quarter 3 of 2022. That could be the end of September or October. By that stage, the winter will be on us and it will be too late to do anything. What are the contingency plans in the case of this happening? The Government's own framework states, "we need to be adequately prepared to deal with supply issues, should they materialise". What preparation has been made? The national energy security framework is very good but it heads out to 2030 and 2050. I want to find out about what we are going to do next winter and next September. Let us not forget that there were several occasions last winter when the generation capacity was under pressure.

I know the Minister spoke about making available further generation capacity in Dublin with more gas burning units. If there is no gas to burn in those units, however, what good are they? This is very serious. It is probably one of the most serious issues facing the State. The Government or the Minister of State may have a response on this issue this evening.It may be that contingency plans are being worked on. I would like to know what they are and I think the people would too.

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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I thank the Deputy for asking this important question. Ireland imports approximately three quarters of its natural gas from the UK, with the remainder coming from the Corrib field. The UK has a diverse supply of gas, including indigenous UK gas, Norwegian gas, liquefied natural gas and via interconnectors with Belgium and the Netherlands. The UK and, by extension, Ireland are not heavily reliant on Russian gas, although the actions by Russia have placed upward pressure on gas and, consequently, electricity prices. Ireland has no gas storage or LNG.

The national energy security framework, published in April 2022, sets out the response of the Government to the Ukraine crisis in the context of natural gas, oil and electricity. The framework provides a single overarching initial response to address Ireland's energy security needs in the context of the war in Ukraine. The development of this framework has taken account of the need to decarbonise our society and economy as set out in recent reports by the Intergovernmental Panel on Climate Change, IPCC, as well as Ireland's targets to reduce emissions by 51% over the decade to 2030 and reach net zero emissions by 2050 as set out in the climate action plan. The framework sets out the Government's action in response to these issues across key themes as follows: managing the impact on consumers and businesses; ensuring security of energy supply in the near term; and reducing our dependency on imported fossil fuels.

The Department of the Environment, Climate and Communications has established a new energy security emergency group, chaired by the Secretary General, which is co-ordinating and overseeing national-level activity and responses in the context of the impact of the war on energy security. The group includes representatives of the Department of Enterprise, Trade and Employment, the National Oil Reserves Agency, the Commission for Regulation of Utilities, Gas Networks Ireland, EirGrid and the Sustainable Energy Authority of Ireland. The work of the group includes: overseeing the implementation of the national energy security framework which has set out the national responses to the impacts on the energy sector; co-ordinating a response to support consumers and businesses, with a focus on financially vulnerable households and those in or at risk of energy poverty; and ensuring emergency plans are up to date and stress tested.

At EU level, measures are in place to address the implications of the war in Ukraine, including any disruption of gas from Russia. These include updated risk analysis and contingency planning, and putting in place a new EU law to ensure that gas storage facilities in the EU are filled in advance of the coming winter. The European Commission is engaging with other countries to ensure sufficient and timely supply of natural gas to the EU from diverse sources across the globe to avoid supply shocks, including those that could result from disruptions.

The war in Ukraine has impacted Europe's energy system and triggered a decision by the European Union to phase out its dependency on Russian gas, oil and coal imports as soon as possible. This will also impact where and how we source that energy and change how we design energy policy to ensure the long-term resilience of the system. The European Commission's RePowerEU communication issued last Wednesday, 18 May, sets out the measures it proposes to end dependence on Russian energy by saving energy, diversifying supplies away from Russia, substituting fossil fuels by accelerating Europe's clean energy transition, removing financial and regulatory barriers to rolling out infrastructure, and ensuring member states have contingency plans to deal with any disruption in supplies from Russia. In addition, the Department of the Environment, Climate and Communications is carrying out a review of the security of energy supply of Ireland's electricity and natural gas systems. It is expected that the review will be completed in the coming months and then submitted to the Government.

Coming back to the issue of the upcoming winter, Ireland is one of the countries in Europe that is least reliant on Russian gas. There is no immediate threat to our gas supplies. Notwithstanding this, in the event of any gas supply emergency, there is excellent co-operation between Irish and UK gas system operators in respect of gas supplies from the UK. This co-operation includes regular testing of emergency plans by the operators. Ireland's gas-fired power plants are capable of running on liquid fuels in the event of a gas supply disruption and have storage of fuels available.

I again thank the Deputy for raising this matter and look forward to hearing his views.

Photo of David StantonDavid Stanton (Cork East, Fine Gael)
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We could probably have a longer debate on this issue. Is there a signed agreement between the UK and Ireland in respect of Ireland's interconnectors and the flow of gas to which the Minister of State referred? It is all very fine stating there is excellent co-operation but what is the nature of that co-operation? Is it a signed agreement between the two countries? As all present are aware, the UK is no longer in the EU.

The Minister of State noted in his response that we have no storage for LNG. There is no gas storage in the State, so if anything happens to those pipelines, we are in trouble. What is the situation in respect of liquid fuels being used to power gas-fired power plants in the event of a gas supply disruption? To what liquid fuels is he referring? Is it gasoline, diesel, kerosene or something else? How much storage is there?

For how long could we depend on that? I noted the Minister of State referred to the REpowerEU. It speaks about diversifying gas supplies via higher liquified natural gas and pipeline imports from non-Russian supplies and larger volumes of biomethane and renewable hydrogen production and imports. We are nowhere on that at the moment. We are dependent on the pipeline from Scotland and that is it. What happens if there is pressure in the UK? I have read that it is a secure supply, the one secure supply in Europe, but it is the only one we have. We know the adage about having all your eggs in one basket. Having all your gas in one pipeline might not be the wisest thing either if anything happens there. I know a review is going on, which will possibly be brought forward to the end of September when the work will start. However, we are into winter then. If anything happens with this gas from the UK, we are in trouble. We must remember that there is a lot of pressure in Europe and further afield. The Minister of State mentioned Norway and Denmark. If the squeeze happens at that end and it transfers into Britain and then here, we are in trouble and we have no contingency plan. The Minister of State has not outlined anything that gives me any solace that there is a contingency plan. If there is storage of LNG in Europe, how does it get here? How do we get it here if the pipeline from Britain is out of action or reduced in some way?

11:00 pm

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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The first question is the nature of the legal agreement between Ireland and the UK on the supply of gas. I will have to consult the Civil Service to give Deputy Stanton an exact answer on that. I do not, however, think it is a gentlemen’s agreement between the two countries. The next question was about the form of liquid back-up for the gas supply plans. I believe it is gas oil and liquid distillate, so it is between those two fuel sources. In regard to how much is available, the National Oil Reserve Agency, NORA, is the statutory body that provides for back-up of liquid fuels in Europe. I believe every country is required to maintain 90 days' supply. That is a mixture of different fuels, everything from crude oil to petrol and every distillate in between. I presume that some of that is allocated but I can get a better answer for Deputy Stanton.

The energy security review is coming up this autumn. The Deputy referenced the national energy security framework, which was published last month. Work has been done on that. The REpowerEU is the emergency response of the EU to this energy crisis. That has been proposed by the European Commission last week and I believe it will be agreed at the European Council shortly. That approaches the problem in three areas. It states we need to do more for energy efficiency; we need to source our fuels from different countries, so we need to attempt to deals with countries other than Russia; and we need to speed up the deployment of renewables in two ways, by providing new sources of finance, including common finance across the EU in green bonds, but also by speeding up the planning process and there are specific rules about managing to be able to deploy renewables much faster than they are deployed at the moment.