Friday, 19 February 2021
Nithe i dtosach suíonna - Commencement Matters
Just Transition Fund
This House is well aware of the significance of the power generation facility at Moneypoint in west Clare and of the impact it has had on the economy of the country and on the growth and strengthening of the economy of County Clare. It has now been in operation for 34 years. It was commissioned in 1987, construction having started in 1979. It has had a very significant impact over those 42 years. There is no doubt that it secured the State's electricity supply, helping in no small way with the growth of the Irish economy out of the doldrums of the late 1980s. As I have said, it also strengthened the economy of County Clare. From the start of construction in 1979, hundreds of people were employed. Hundreds more were employed by the fledgling station. The number employed in the operation of the electricity generating facility grew to approximately 300 at its peak. All the while, contractors and external companies also provided labour to the facility. Approximately 600 people worked in the facility at its peak. People moved to the area from other parts of the country and locals were spared the outlet of emigration. Communities such as those in the major town in the west of Clare, Kilrush, in Milltown Malbay and in villages such as Kilmihil, Kilkee, Cooraclare and Lissycasey all grew and were strengthened. People settled in these areas and those communities were protected. There is scarcely a village in County Clare in which there is not someone who worked in Moneypoint at some point. It was a real driver of the local economy.
The Minister, given his expertise, will certainly know how climate change has changed everything, as do we all. Our recognition of the harmful effects of the CO2 emissions from the burning of coal has changed our outlook and the way we live our lives. It has, however, been a key plank of the Minister's policies and those of Fianna Fáil that the communities that have invested a great deal in infrastructure that is now not climate-friendly must be assisted. Nowhere needs this assistance more than Moneypoint and the west Clare area. I ask the Minister to extend just transition funding to meet the needs of those communities that, at the direction of the State, built their lives, had their families, built their homes and set their dreams and aspirations in the villages and towns in this area. We cannot allow the area to become a parked-up rust belt. We know what happens when policies like that are allowed to prevail. We saw what happened in the United States when states moved away from coal extraction and steel working. We saw the impact that had on the democracy of that country when some sought to play with it. I do not want to see the same thing happen here. I want these people to be provided with the real supports they now need.
The communities need just transition funding. The Minister will know that €77 million has been provided by the European Union for the period between 2021 and 2027.I want the money extended to that area. I also want to see the ESB play a greater role. The reality is that it has shrouded its plans in mystery and secrecy. The plant was supposed to close in 2025, but that has been brought forward because of the way electricity is now priced and the emergence of much more wind energy. The numbers have reduced dramatically. There are probably fewer than 100 people working there from a peak of 600 combined workers. We need to act now. The ESB needs to have an action plan to look to the potential of the plant to capture wind energy off the western seaboard and to see if there is potential to have a gas generation system for electricity with carbon capture and storage. As a State, we need to provide the appropriate funding to help those communities to transition from the burning of coal to finding more opportunities in the green energy sector in particular.
I welcome the opportunity to set out the actions being taken by the Government in response to the announcement of the downsizing of the Moneypoint power station in west Clare. The programme for Government committed to achieving an average reduction of 7% per annum in overall greenhouse gas emissions from 2021 to 2030. This remains a key objective for the Government, and the changes to electricity generation within Moneypoint form part of the steps required to meet this goal.
The 2019 climate action plan also committed to ending the burning of coal at Moneypoint by 2025 at the latest and to the replacement of coal-fired generation with low-carbon and renewable technologies. This remains the objective of the updated climate action plan, due to be released later this year.
The national just transition fund was established in mid-2020 to respond to the immediate closure of the ESB-owned power stations in Lanesborough, County Longford, and Shannonbridge, County Offaly, and to support affected communities in the region with the transition from employment in peat harvesting. As a result of this direct focus, eight of the most affected counties were eligible to submit funding applications to the 2020 just transition fund.
The Government has announced provisional funding offers totalling almost €30 million under the just transition fund to more than 60 projects throughout the region for projects from the private sector, local authorities and communities in the midlands that are committed to creating a green and sustainable economy for the region. This will contribute to making the midlands an attractive and sustainable place to live and work, including by funding training and reskilling so local businesses and communities can adjust to a low-carbon transition.
Looking ahead to future just transition supports, the European green deal has led to the establishment of a new EU just transition fund whose objective will be to alleviate the socioeconomic impacts of the low-carbon transition in the most affected regions across the EU. This fund may be used to support the reskilling of workers, help SMEs to create new economic opportunities, and promote the diversification of economic activity towards low-carbon sectors and progress towards achieving the EU's 2030 climate targets and a climate neutral economy by 2050.
Ireland must prepare a territorial just transition plan, for approval by the European Commission, in order to secure access to supports from this new EU fund. The territorial plan will set out our investment priorities and will identify the sectors and regions to be supported. Part of my Department's work to prepare this territorial plan will include identification of the most affected regions based on the requirements and criteria of the relevant EU regulations. I envisage that this work will be completed this summer.
Separately, as part of the renewable electricity support scheme, RESS, it is a requirement that renewable electricity generation projects that gain support establish a community benefit fund for the distribution of benefits to local communities. Under the first RESS auction it is expected that these funds could amount to more than €4 million per year for local communities across the country. These benefit funds will give local communities the ability to fund worthy sustainable development initiatives as well as fund local clubs and societies that the community deems worthy of support. These funds will be vital in ensuring that communities that host the electricity generation projects of the future retain the benefits locally.
I am aware of a number of projects in counties Clare and Limerick that were successful in the first RESS auction last September and communities in the vicinity of those projects will begin to see the benefits of that funding in the coming years. With the abundant natural renewable resources in west Clare, and offshore, I expect to see further projects coming through later RESS auctions with a resulting increase in funding through local community benefit funds throughout the mid-west region. In the longer term, the Government is planning major investment in offshore wind resources in the Atlantic Ocean, bringing economic benefits to the mid-western region including through development of ports and re-using existing grid infrastructure.My Department is carrying out a review of the security of energy supply of Ireland's electricity and natural gas systems, focusing on the period to 2030 in the context of a sustainable pathway to 2050. This review will consider a range of options to enhance the security of supply, including sources of electricity generation for use in the event of a shortage of natural gas.
I welcome the clarification that, at least, the ESB is looking at the classification of the plant. The reality is that will probably require approximately 30 employees. However, compared with the height of having 600 employees at the plant, it is no compensation for the wider community. Yet again, it protects the State's requirement to have a back-up electricity supply. What we need is targeted investment under the just transition fund and a portion of the €77 million that has been provided by the EU to support the communities that have already lost very significant amounts of income as a result of the way in which the ESB had to downsize its operations at Moneypoint. It is important that funding is put in place to ensure there is gainful employment. I look forward to proposals and plans for developing offshore wind energy projects, but the experts have indicated that such projects are probably ten years away. We need to protect these communities and bridge the gap between now and ten years hence when there is expected to be potential employment in that area.
I referred to the 2019 climate action plan. In truth, we will have to be more ambitious in many different areas such as agriculture and transport, but also in energy. One of the areas where things will probably advance more quickly than was set out in the plan is that of power generation. While preparing my response to the Senator, I noted that the price of carbon today is almost €40 per tonne. At that price, Moneypoint does not operate. It is outside the merit order. It does not make economic sense. As such, the 2025 deadline is increasingly irrelevant in the context of what the reality is.
The Deputy was partly correct with regard to offshore development being ten years away. Later this year or early next year, we will start auctions for offshore wind on the east coast, but we will not have to wait ten years to start in deeper waters elsewhere and to look at the prospects of floating wind turbines and so on. It will take a long time. These projects are huge. The turbines we will be putting out from the Shannon Estuary into the Atlantic will be far higher than the chimneys at Moneypoint. People in the area know how dominant those chimneys are. The jobs to which the Senator referred, which were created in the late 1970s and 1980s during the construction of the Moneypoint station, will be a fraction of the jobs that will be available not only in the deployment, maintenance and management of that new energy system, but also the jobs that will be created in the context of the use of the power as it comes back in. The real prospect here is not just building energy generation in Moneypoint and elsewhere in County Clare, but bringing the industry to where the power is. That is the prospect that holds out real opportunity and it is why we should be quicker and more ambitious, rather than just accept existing plans.