Tuesday, 11 March 2014
Wind Energy Generation
I welcome the Minister, Deputy Rabbitte, to the House. I am very grateful to him for coming to the House to respond to my question. As the Minister is aware, there is a great deal of anxiety and speculation concerning the status of the intergovernmental agreement between the UK and the Government on the wind export project.
I have been inundated with contact from communities from Knockmore in Mayo to Kildangan in County Kildare and Ratheniska, Rosenallis and Vicarstown in my native county of Laois. Communities have been living in the shadow of the prospect of the development of what they see as daunting, imposing and unnecessary giant industrial wind farms which were proposed to be constructed by both semi-State and private developers for the purpose of wind energy export. As I understand from previous pronouncements by the Minister in the Seanad, as recently as 19 February the intergovernmental agreement was contingent on the two Governments concluding an agreement and that the wind energy export project was predicated on that basis. That being the case we are a little taken aback at the pronouncements from some of the companies and agencies in the past 48 hours to the effect that they insist on proceeding with the projects.
I cannot see how this could be the case as they were always intended to be export projects. The market was deemed to be within the United Kingdom, as there is no capacity or demand within the Irish system in terms of energy generation or within the grid.
Second, I ask the Minister to bring absolute clarity to the situation for families across the country and for the various developers involved so that they can know where they stand and not be left in limbo wondering about the status of the intergovernmental agreement. Was today the day the agreement was to be signed between the Irish and British Governments - since the Taoiseach is in London as we speak with the British Prime Minister, David Cameron? There is also a question of the implications of this latest development for our entire energy policy and strategy as it impacts on EirGrid, Bord na Móna and Coillte and in terms of the energy strategy being pursued by Sustainable Energy Ireland, all agencies which fall within the remit of the Department.
I am grateful the Minister has come into the House for this matter and hopefully he can bring some clarity and finality on this issue.
Ireland is fortunate to have very rich wind resources. We can now exploit those renewable resources to generate electricity, reduce our import bills for gas and oil and contribute to decarbonising our energy systems. Thanks to technology, we now have the technical capacity to create a new traded sector in green energy. Last year I signed a memorandum of understanding with my UK counterpart, Ed Davey, and since then our two Departments have been working towards an intergovernmental agreement, as required by the EU renewables directive, to facilitate trade in green energy between Ireland and Britain.
The contemplated midlands wind export project has been greatly misrepresented, often wilfully and sometimes dishonestly. When the plan to build out and modernise the grid was settled in 2006, the midlands export project was not even a beam in the eye of its originators. It is a private sector project that can only proceed as permitted by an intergovernmental agreement. Otherwise, the British side cannot count the imported power as coming from renewable sources and include it in meeting its own renewables targets. Nor can the project proceed except in compliance with a national policy and development framework, after a strategic environmental assessment that identifies the areas not suitable for wind farms.
We have done a cost benefit analysis, which shows significant economic benefit for both countries. On our side, we estimate approximately 6,000 job years at construction stage, revenue streams to local authorities and local communities and, most importantly, an annual dividend from trading to the Irish Exchequer. In addition, from discussion we have had, Ireland would be in a strong position to develop a supply sector for the industry. Furthermore, the midlands export project would offer new business opportunities to Bord na Móna, because it is difficult to see the development of any such project without taking into account the tens of thousands of acres of cutaway bog in the ownership of that company.
All of this must be settled within a very tight framework, both because of European Union requirements and because the private sector developers must, before they invest, know that they will benefit from the UK support systems. However, key policy and regulatory design decisions remain to be taken by the UK Government, which means that we are still a considerable distance from settling on the specifics of what the Irish Government and the renewable generators believe must be the basic components of any intergovernmental agreement. I repeat what I said in this House on 20 February 2014, namely, that without us seeing a considerable dividend in terms of revenue and employment for Ireland's benefit, there will be no such agreement.
Against that standard and following my meeting last week with Secretary of State for Climate Change and Energy, Ed Davey, I now find it difficult to see how, within the timeframe, it is possible to deliver the project as envisaged. I take this opportunity to repeat what I said on 20 February, namely, that whether or not the midlands export project goes ahead, this country will still need a grid that is fit for purpose. The plans to develop the grid do not have, and never did have, anything to do with the midlands export project. The midlands export project remains a novel one which, if realised, will bring jobs and wealth to Ireland. It does not appear that it can be realised at this time.
I am grateful to the Minister for his response and agree with him on one issue, namely, that there has been a great deal of dishonesty surrounding much of the information concerning these projects, not least from those who, at some stage or other, claimed they would bring in 60,000 jobs. This has now been diluted to a projection of 6,000 jobs.
Was it not the case that when this policy was devised in 2006, his predecessor, former Minister, Eamon Ryan, said the grid expansion was to facilitate renewables? Therefore, I put it to the Minister that this does have implications for EirGrid. I see nothing categoric in his answer to refute the fact that communities are being left in limbo as to whether these export projects will proceed. It seems to me they are merely being deferred.
Forgive me, but I must be in the other House in two minutes to deal with the ESB Bill. The midlands wind export project was not even contemplated in 2006. The refurbishment of the grid has nothing to do with the wind export project, which is a separate, stand alone ring-fenced project with a different technology sub-sea DC cable and so on. It would be helpful if there was less agitation based on misrepresentation, especially in the midlands.