Ciarán Cuffe (Dún Laoghaire, Green Party)

I apologise for the delay in getting to the House. The threat of climate change will have implications for this and future generations. Ireland must play its part in tackling this threat. We must continue to do our part to help reduce global emissions and, by doing so, create a viable and climate resilient society and economy at home. By achieving firm targets to increase the use of renewable energy, we will reduce environmental degradation significantly and contribute to mitigating global problems such as climate change. Energy consumption is unavoidable which means the energy sector in Ireland is a key player in our economy. Unfortunately, we suffer many disadvantages where energy is concerned owing to our size and island location. Our isolation from the European energy infrastructure accentuates the need for security of energy supplies, efficient energy infrastructure and the development of indigenous energy infrastructure. Ireland, as a country, has immense potential for the development of renewable energy both on and offshore. The development and expansion of the use of renewable energy, together with measures aimed at reducing our energy needs and a more efficient use of energy, are important in meeting our climate change objectives and priorities, both nationally and at European level. A significant increase in renewable energy and the protection of the environment are, therefore, mutually reinforcing goals.

The renewable energy sector has seen a significant number of policy initiatives in recent years, most notable among which have been the 2007 energy White Paper and the 2009 renewable energy directive. These documents have had important ramifications for renewable energy policy. In the first instance, the White Paper sets overarching targets for penetration of renewable energy in the electricity, heat and transport sector. These targets are now 40% renewable electricity, 12% renewable heat and 10% renewable energy in transport. The renewable energy directive, on the other hand, sets a binding 16% penetration of renewable energy across the various sectors, and a binding 10% penetration of renewable energy in transport. Achieving these targets will assist Ireland's attempts to meet its commitments under the Kyoto Protocol and the Copenhagen Agreement. The national renewable energy action plan, NREAP, sets out the Government's strategic approach and concrete measures to deliver on Ireland's targets. The development of renewable energy is central to overall energy policy in Ireland. Renewable energy reduces dependence on fossil fuels, improves security of supply and reduces greenhouse gas emissions, creating environmental benefits while delivering green jobs to the economy, thus contributing to national competitiveness. Climate change, energy security and competitiveness are inter-related challenges that will be addressed through the transforming of Ireland's economy from one based on fossil fuel dependence to a low carbon economy based around energy efficiency, renewable energy and smart networks.

The important role played by European Union directives in this area should not be underestimated. The 2001 renewable electricity directive was instrumental in establishing market frameworks and technical rules around renewable electricity, as were previous bio-fuels directives. Crucially, however, the 2009 renewable energy directive will play an even more central role in the development of renewable energy across Europe in the years to 2020. This directive sets individual binding targets on each member state for a total penetration of renewables by 2020, with Ireland receiving a target of 16%. It also sets a universal target of 10% renewable energy in transport by 2020 across all member states. These targets and the widespread acceptance of the need for them from across the EU set the tone for the development of the sector and, as I will explain, present some major opportunities for Ireland. The Government has set a target of 40% electricity consumption from renewable sources by 2020. In the past five years in particular, Ireland has made big strides in accelerating renewable generation. In the 2001 directive on renewable electricity, Ireland was set a target of moving from 3.6% penetration of renewable energy to 13.2% by 2010. Ireland achieved 14.4% in 2009 and is on track to exceed the national target of 15% in 2010. All key national entities, including the energy regulator, the distribution and transmission system operators and the renewable energy sector are working with the Government to deliver the 2020 target through grid connection and grid development strategies.

The significant growth in electricity from renewable sources in recent years is largely attributable to wind energy. As Ireland moves towards achieving the target of 40% electricity from renewable sources by 2020, the Irish grid increasingly is having to cope with the challenges posed by large amounts of intermittent power. The Irish transmission system operator, EirGrid, is involved in a detailed examination of the issues and pioneering several renewables facilitation studies with a view to ensuring the appropriate management of the grid and stability of the electricity system during the transition. The all-Ireland single electricity market, overseen by the regulatory agencies North and South, is evolving continuously to take account of the growth in renewable energy. Importantly, there is widespread acceptance that renewable electricity can bring down wholesale electricity prices, with obvious positive effects for consumers.

Together with the significant contribution of large-scale generation, the introduction of a robust framework for the development of a vibrant microgeneration sector is an important component of building societal acceptance of energy infrastructure and ownership of the national renewable energy targets. The microgeneration sector has the potential to create employment and enable participation by a wide section of the community. The Government is committed to developing a comprehensive microgeneration framework which will be taken forward up to 2020.

Ireland's ocean territory extends to 89 million hectares and encompasses a wealth of natural resources. The sea area is ten times the size of the land area and one of the best wind and wave resources in Europe. Our marine environment can provide a vast amount of energy through offshore wind, wave and tidal energy technologies. I have recently published a draft offshore renewable energy action plan, with a strategic environmental assessment of low, medium and higher marine renewable energy development scenarios, to inform policy decisions as we develop this new industry. It is now open to public consultation and everyone should give his or her views on how it should develop, with appropriate consideration given to economic, environmental and other factors. The assessment has considered the potential impact of scenarios for developing up to 4,500 megawatts of offshore wind and 1,500 megawatts of wave and tidal energy, irrespective of commercial viability or other constraints and independently of the existing onshore power transmission grid.

We must develop the strategic approach needed to marry the delivery of increased renewable energy capacity with other key environmental objectives and obligations. We must avoid and minimise the potential environmental downsides of renewable energy development. It is also essential that sustainability in the energy sector is managed in a manner that secures the international competitiveness of Irish energy prices.

The continued development of our sustainable energy platform is of vital social and economic importance. If we get this right, Ireland can be at the forefront of developments internationally. If the full extent of the marine renewable energy potential is developed and tapped, Ireland could not only harness this electricity for domestic consumption but also become a net exporter of electricity from renewable sources to Britain and mainland Europe. To that end, on 3 December, the Minister for Communications, Energy and Natural Resources will sign a memorandum of understanding on the north seas offshore grid initiative. This initiative involves a co-operation agreement between EU member states with north seas access, including Norway, with a view to the consideration of appropriate offshore electricity transmission infrastructure required to develop a large-scale offshore renewable energy system in northern Europe. There are no immediate financial implications, but the potential long-term benefits for Ireland, given our resources, are startling. We have already begun work on a first interconnector with Britain, a 500 megawatt link that will come into operation in 2012. This is a vital step, but only a first step in the interconnection of European electricity systems.

The Government has set a target of 12% renewable heat by 2020. A series of related and complementary support programmes such as the combined heat and power deployment programme, the reheat programme and the greener homes scheme have been put in place to address the delivery of this target, aimed at supporting both the demand and supply sides. More combined heat and power plants are being built each year using biomass feedstocks such as wood, energy crops and waste. In CHP plants heat produced from the electricity generation process is also captured for use in projects such as district heating schemes and drying plants. Currently, the amount of heat from renewable sources stands at 3.6%.

For historical, geographical and demographic reasons, renewable heat poses considerable challenges for Ireland, challenges which the Government is determined to address. To that end, work is nearing completion on a new framework to ensure delivery on these targets using the full range of resources available, with an initial focus on the biomass sector but also including geothermal resources in due course. The Department, in conjunction with all stakeholders, is finalising a roadmap for the development of the bioenergy sector in Ireland.

Ireland will need to mobilise biomass from all available sources. Historically, only a small proportion of Ireland's land area has been covered by forest. Recent afforestation has helped to bring the amount of land area covered by trees to 10%. However, the rate of afforestation in Ireland is the lowest in Europe and Ireland needs to encourage further expansion of its forests. We also need to incentivise the growth of energy crops. To these ends, the Minister for Agriculture, Fisheries and Food has been running schemes to encourage afforestation and the growth of shorter rotation energy crops such as willow and miscanthus. I was pleased to see so many willow and miscanthus growers with stalls at the National Ploughing Championships a couple of months ago.

REFIT, the renewable energy feed-in tariff, is designed to provide certainty for renewable electricity and heat generators on the price they receive. In operation for wind and hydro power since 2006, it acts to ensure a guaranteed price for each unit of electricity exported to the grid by paying the difference between the wholesale price for electricity and the REFIT price. In effect, this means that as electricity prices increase, the amount paid under REFIT falls, mitigating the effect on the consumer. Reflecting the need to support the development of biomass, the Minister for Communications, Energy and Natural Resources announced in May new tariffs to include supports for renewable energy generated from biomass. The guaranteed support price will range from 15 cent per kilowatt hour to 8.5 cent an hour depending on the technology deployed.

The 2007 bioenergy strategy committed to 30% co-firing in the three peat-fired power stations at Edenderry, west Offaly and Lough Ree, which would mean a demand of approximately 900,000 tonnes of biomass per annum. Large-scale trials have been under way at Edenderry for several years, where in excess of 75,000 tonnes was burned in 2009. Smaller scale trials are under way in the two other plants. The trials have been largely successful to date, although there remain concerns about the effects combusting some of the feed stocks, including miscanthus, may have on boilers in these stations. Further testing is under way to evaluate this. The testing programme is critical in determining the likely success of the co-firing programme; the power stations were designed and built to exclusively burn peat and it is important that a range of engineering, logistical and process questions are answered before setting out long-term policy measures which would have significant cost implications for the consumer.

Taken together, REFIT and co-firing will foster the development of a robust and sustainable biomass supply sector in Ireland. They will drive demand for biomass and support the measures in place such as the reheat programme and the energy crop grant schemes run by the Department of Agriculture, Fisheries and Food.

Ireland's transport sector is hugely dependent on imported oil and the Government is working to transform this dependency. A two pronged strategy has been put in place which combines significant increases in the use of bio-fuels with the accelerated development and use of electric vehicles in Ireland. The national bio-fuel obligation scheme, introduced in July, obliges all road transport fuel suppliers to use bio-fuels in the fuel mix to ensure they represent a certain percentage of their annual fuel sales. The initial penetration rate is 4% per annum, to be increased over time. The bio-fuel obligation will ensure Irish consumers will have access to appropriately priced, sustainable and reliable sources of bio-fuel in the coming years. In so doing, this will give an important incentive to domestic bio-fuel production. It is pleasing to note that in the first three months of operation the penetration rate of bio-fuels used in Ireland was just over 4% - the obligation is already achieving its targets. However, the Government has set a target of 10% of all vehicles to be powered by electricity by 2020. To that end, all relevant Departments and agencies are working intensively to position Ireland at the forefront of electric vehicle deployment. It is estimated that replacement of 10% of cars, vans and buses in Ireland with hybrid and battery electric vehicles could reduce national CO2 emissions by 350,000 tonnes annually and help towards reducing Ireland's dependence on imported fossil fuels.

The Government is taking a broad-ranging series of initiatives on electric vehicles, including the signing of memoranda of understanding with a number of motor manufacturers, the provision of appropriate supports for customers and a commitment to a large scale national roll-out of infrastructure for electric vehicles. The size and geography of Ireland make the country uniquely suitable for electric vehicles, and the Government is ensuring that Ireland becomes an early test bed for this technology and that it takes full advantage of the potential benefits associated with using electricity from renewable sources in transport.

The Government, along with the ESB, has agreed a memorandum of understanding with the Renault-Nissan alliance to ensure a supply of electric vehicles to the Irish market. A range of electric vehicles will be available in 2011 from a number of manufacturers. By the end of 2012, most mainstream motor manufacturers will have a number of electric vehicles available for sale; in other words, electric vehicles will have gone mainstream. Beginning in 2011 and running for two years, a grant support scheme will be available to assist in the purchase of battery-powered electric vehicles and plug-in hybrid electric vehicles. Grants of up to €5,000 will be given towards the purchase of these vehicles. These grants will be available for up to 6,000 vehicles and will be in addition to the VRT exemptions and VRT reliefs that currently apply to the purchase of new electric vehicles.

The ESB is currently rolling out 1,500 publicly accessible charge points for electric vehicles, which will be in place by the end of 2011. These will be located in every city and town with a population of more than 1,500. In addition, 2,000 domestic charge points will be installed. As well as the above, 30 fast chargers will be built 60 km apart along all major inter-urban routes. It is increasingly clear that the electrification of transport will accelerate over the coming years, with positive impacts in terms of reducing transport-related emissions and ensuring security of energy supply.