John Browne (Wexford, Fianna Fail)

I thank all Senators for their contributions to this timely debate which has produced many good constructive ideas from all sides of the House. I thank in particular Senators Finucane and Kenneally for their contributions.

Continuity of supply was identified as the priority. The Minister and the Department have been working long before I came to the Department to ensure this will continue. The country's economy is doing very well and it is important to have continuity of supply in the future so that those in business will have confidence in a continuity of supply.

I will refer the points raised by the Senators to the Minister, who, along with me and the departmental officials will consider some of the worthwhile suggestions made. Senator Finucane raised the matter of the Deloitte & Touche report which is currently being considered in the context of the Department's work to develop an energy policy. The policy paper should be available later in the year. I will bring to the attention of the Minister the Senator's request that the report be made public. Knowing the Minister, I doubt if he would have a problem with doing so because he acts in an up-front manner when dealing with issues.

Senator Daly referred to the establishment of an energy agency. As I only joined the Department yesterday I am not sure if this is being considered but I will bring it to the attention of the Minister.

A number of Senators raised the issue of biofuels. The EU does not permit any tax relief package to exceed six years in duration so a ten year commitment, as suggested, is not possible. The Government has allowed for a five-year package and is considering all policy options for the development of the sector. The subject of biomass was referred to by a number of Senators. As I have lately come from the Department of Agriculture and Food, I have been very involved in this area and in the area of afforestation. A total of 93% of afforestation is now carried out by farmers and it has become an important alternative crop for them.

This year the Minister for Finance allocated €137 million for forestry, the highest allocation ever. My only regret is I had not allocated the grant before I left the Department of Agriculture and Food but that will be the responsibility of the Minister, Deputy Coughlan and the Minister of State, Deputy Mary Wallace. They are considering a number of initiatives in the area of biomass. Johnstown Castle in my home county is in the process of being developed as a pilot centre for wood-burning boilers. As Senator Leyden stated, a number of local authority housing schemes are being heated by wood-burning boilers.

The Wexford county manager informed me that two new housing schemes are being heated using wood pellets. An interdepartmental group produced biomass and alternative energy policies. The Department of Agriculture and Food, in conjunction with my Department, will shortly announce a number of packages.

Senator Quinn raised a number of issues to do with continuity of supply and the future role of the regulator which was also raised by other Senators. Regulatory bodies have become the norm. In the past, people did not trust the Minister of the day to make decisions and regulators were established. I agree that the role of the regulator needs to be reviewed on an ongoing basis and I will bring this issue to the attention of the Minister.

The matter of grants for renewable energy in the domestic sector was raised by a number of Senators. A multi-annual finance package of €65 million from 2006-10, was announced in the budget. This package will include grants to householders to install renewable energy technology such as solar power — which was raised by Senator O'Toole — biomass boilers and geothermal heat pumps. The scheme is being developed and will be launched soon.

I acknowledge the point made by Senator Leyden that the development is too slow but the budget was only announced last December and it is now early February. The Minister and his officials have carried out significant work in this area and the launch will occur shortly. This initiative complements similar funding programmes for housing developers run by Sustainable Energy Ireland.

The energy performance and buildings directive has been implemented by the Department of the Environment, Heritage and Local Government and includes new building standards for all buildings which will improve their energy performance. All large-scale buildings will be required to consider using renewable energy.

All speakers referred to biofuels. Under EU rules, the Government is not permitted to insist that all petrol and diesel sold should contain a percentage of biofuels. However, biofuel suppliers can be obliged to place a percentage of biofuels per annum on the market. A number of member states have opted for this policy but it would take considerable time to establish such a system. The Department is examining all policy options, in close consultation with other relevant Departments and member states.

The new excise relief package for biofuels will cost €205 million over a five-year period. It is hoped this will encourage the development of indigenous biofuel plants. Their programme will be underpinned by capital grant aid for processing facilities and will commence this year.

When the Minister and I made a case to the Minister for Finance, we were pushing an open door. He is very committed to the area of alternative energy and the biofuels sector. If there is a demand for the package announced in the budget, we will be in a position to rely on the co-operation of the Minister for Finance. He recognises that the dependence on imported gas and oil is not ideal. As Senators Quinn and Kenneally said, the long-term future needs must be considered.

The problem with nitrates was first raised in 1991 but it was put on the long finger and then came the day of reckoning. We must make long-term decisions about alternative fuels and this is the Minister's intention.

Senator Ulick Burke raised the issue of Gama. The new 384 MW power station in County Galway has been constructed following an open competition conducted by CER for the provision of new generating capacity for the security of supply of electricity. Tynagh Energy and Aughinish Alumina were the two winners of the competition. I wish to make it clear that it was an open competition and that Aughinish Alumina and Tynagh Energy were the successful bidders.

A number of Senators referred to farming opportunities using alternative crops. Having just left the Department of Agriculture and Food, I know that the Minister, Deputy Coughlan, is working closely with farm organisations to see how they can develop new alternative crops. The beet industry is under pressure along with other areas and the Minister is working closely on those matters. We must recognise the fact, however, that farmers will only grow crops if they get a viable return. I am familiar with oil seed rape and a number of companies in Wexford are working in conjunction with farmers to produce biofuels from that crop. However, the amount of money that is available from Europe for this endeavour, at €45 per hectare, is much too low. In view of the curtailment or death of the beet industry, the Minister, Deputy Coughlan, is working closely with Europe to try to obtain an increase in that figure to make it viable for farmers to produce oil seed rape.

I thank Senators for their contributions to this debate. I will certainly take up a number of the issues they have raised today consider them with my officials. We do not have a monopoly on wisdom as to how the alternative energy sector will develop in future and, consequently, we are interested in listening to what people have to say in this regard.

I wish to thank my officials for giving me sound advice on this debate and in other areas that are coming to the forefront concerning alternative energy.