Seán Power (Kildare South, Fianna Fail)

I am pleased to introduce the Gas (Amendment) Bill for Committee Stage consideration in the Seanad. The Bill has one provision, namely, to increase the statutory borrowing limit that applies in respect of Bord Gáis Éireann from the existing figure of €1.7 billion to €3 billion. Its enactment will give the company the legal ability to access funds to develop the strategic direction set out in its five-year corporate plan up to 2012 and beyond.

The Bill amends section 23 of the Gas Act 1976, which provides for borrowings by Bord Gáis Éireann for capital purposes. It is unusual that amendments have not been tabled in respect of the Bill. I thank Members for their co-operation with the Bill to date.

I will now deal with a number of the issues raised by Senators Walsh and O'Reilly during their extremely constructive contributions. As stated on previous occasions, the monopoly of wisdom does not lie solely on one side of the House and it is important to take on the views of all Members.

The use of gas to produce electricity is the cleanest form of generation outside renewables. Gas-fired plants will increasingly be used as back-up to wind-generated electricity. The emphasis, however, will be firmly placed on developing renewables.

Senator Walsh referred to the dangers attached to borrowing. In the past, we used to refer to borrowing millions and people would become somewhat uncomfortable. More recently, however, the talk has been of borrowing billions. Most people might not even be sure of the number of zeroes in 1 billion. We are discussing major amounts of money and increasing Bord Gáis Éireann's abilities by expanding its borrowing capacity. There is no doubt that the company is taking on a major responsibility. However, it has been in existence for over 30 years, has proven itself to be an extremely capable performer and has played its part in developing the economy.

The treasury department of Bord Gáis Éireann will seek the best value on offer in the markets at any particular time and the Bill gives it the necessary flexibility to do so. In the past, the company has taken the steps required to minimise risk, which is a job in itself. I am satisfied that Bord Gáis Éireann will proceed in a professional way and will minimise the risks involved to the best possible extent.

Bord Gáis Éireann is examining the possibility of storing gas in salt mines. It has made a provision of up to €200 million in its capital plan in respect of such a project.

The issue of pricing was discussed in some detail during last week's Private Members' business in the Dáil. We have asked the regulator to examine the possibility of bringing forward a much earlier reduction in prices. The costs relating to oil and gas have been low in recent months and we would like this to be reflected in the price consumers are obliged to pay for the energy they use. In August of last year, enormous price increases were sought in respect of gas and electricity. At that stage, the regulator decided to adopt a new approach by granting an increase of approximately 50% of the amounts sought. The regulator then agreed to review the position later in the year. This was done in December, by which time the position globally had changed dramatically. As a result, the price of one form of energy remained the same and there was a slight decrease in respect of the other.

There are a number of factors at play with regard to oil and gas. However, my colleague, the Minister for Communications, Energy and Natural Resources, Deputy Eamon Ryan, announced last week that we could expect a further — possibly a double digit — reduction in energy prices in the near future. We asked the regulator to meet the stakeholders and to return to us with a number of options within a matter of three to four weeks. These will then be presented to Government. I am satisfied that we will be in a position to reduce the price of energy further. That price is a major factor, particularly in respect of the level of competitiveness to which everyone is referring at present in the context of the threat to jobs in different sectors.

Over 50% of electricity produced in this country is generated through the use of gas. As Senators are aware, gas was discovered in recent years off the west coast at Corrib. The find in question will have a lifespan of approximately 15 years. Unfortunately, we encountered a number of obstacles and difficulties in trying to bring the gas ashore but we are as committed as ever to doing so. Recent events have clearly demonstrated the need to develop the project and ensure that the gas is brought ashore as quickly as possible. This gas should provide up to 60% of the country's needs during the 15 year lifespan to which I refer. It is a considerable resource.

Senator O'Reilly referred to the recent difficulties involving Russia and Ukraine. These illustrated the need to ensure, to the greatest possible extent, that there is security of supply. When one is depending on other countries which are dealing with their own problems, one realises the risks involved. What happened in the case of Russia and Ukraine highlighted, in no uncertain terms, the need to develop our own sources of energy. As an island nation, Ireland has resources which have remained underdeveloped for a long period. We were probably slow to commence projects relating to wind and wave energy in particular. However, much progress has been made in recent years and we will continue with our efforts in this regard.

The area of renewable energy has attracted much investment in recent times. Various sectors are feeling the pinch as a result of the credit crunch and the difficulties being experienced in the global economy at present. The energy sector, particularly as it relates to renewables, offers great hope for the future. There has been a major increase in the amount of money invested in this sector. When one considers the ambitious targets we have set in respect of renewables, it makes sense that people should engage in such investment. The future is bright as regards the renewable energy sector. The Government will continue its support for the sector.

Senator O'Reilly referred to competitiveness and the importance of a further reduction in energy prices. In recent years, we have imported over 90% of our energy needs, which makes us extremely vulnerable. This illustrates the importance of developing alternative sources of energy. We have focused our efforts on making progress in this regard and on reducing our level of dependency in the coming years. We have ambitious targets for renewable energy and I am sure we will be able to maintain the significant progress made in recent years.

On comparisons between Irish energy prices and those of other European countries, while price is important, it is not the only factor one must consider. In Spain, for example, consumers must still pay the outstanding cost of providing energy infrastructure. The cheap energy Spanish people currently enjoy will not last forever and energy prices will increase substantially at some point. Moreover, many Irish people would find it objectionable if the State were to adopt the nuclear option pursued by France. Factors other than price are at work in many cases.

Ireland was late in entering the race to develop renewable sources of energy and is probably paying the price for this failure. Nevertheless, the Government is serious about tackling the cost of energy. As the Minister indicated recently, a double-digit decrease in energy prices is anticipated in the near future. I will be pleased to address any other issues Senators may wish to raise.