Seanad debates

Thursday, 27 January 2022

Nithe i dtosach suíonna - Commencement Matters

Energy Policy

10:30 am

Photo of Joe O'ReillyJoe O'Reilly (Fine Gael)
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I thank the Cathaoirleach for accepting this matter for discussion. It relates to a very pertinent contemporary issue, and I appreciate the fact that he recognises this. I thank the Minister of State for being here to answer questions on it and to inform the House of any developments.

We can be thankful that the debate on the science of climate change is effectively over. There are very few naysayers left. It is now a matter of implementing solutions and deciding how to address the problem. To be technical, there is what is called blue hydrogen and there is green hydrogen. Green hydrogen has potential as an energy supply that involves no carbon emissions. It could be very productive in that regard. It was recently recognised at a very high level in a speech by an Taoiseach at a meeting of the shared island forum held in Dublin Castle on 9 December 2021 when he said:

We will [...] work to develop with [...] the UK Government a cross-border pilot project on green hydrogen for the road network. We stand ready to resource an agreed project

That commitment was made. Will the Minister of State tell me what steps have been taken in that regard?

The main source for what I will say here is a report commissioned by Green Tech Skillnet in partnership with Wind Energy Ireland and Skillnet Ireland. That report forms the basis of my comments today. It says that long-term strategies for the use of green hydrogen have been developed in jurisdictions as diverse as Canada, Chile, Colombia, the Czech Republic, France, Germany, Hungary, the Netherlands, Norway, Portugal, Spain, the UK and the EU and notes that, following COP26, green hydrogen targets in these regions were raised. The background is that this is a live issue that needs to be advanced.

The main possible source of green hydrogen in this country is wind turbines. Our domestic wind turbines, which are mainly on-land wind turbines, are not enough. We need to take advantage of the great potential for offshore wind turbines, particularly off the south-west coast. We have some of the greatest potential in Europe in this regard. There should be a surplus of wind energy. We should ultimately be able to supply the domestic market while also having the potential for exports, according to this report.

There is a definite role for green hydrogen in meeting Ireland's energy needs. The report tells us we now have the technology to utilise it and the economic and political will is there. It is, of course, easier for the larger industrial countries but green hydrogen could potentially be used for power generation here in, for example, Moneypoint or Whitegate. It could also be used as aviation fuel or shipping fuel. There is also the potential to export it. Ultimately, it will be possible to use it in lorries. Injecting a blend including 20% green hydrogen into the national gas pipelines is technically achievable. That is something we should be doing. We need to get a pilot project up and running in order to collect evidence. I am running out of time but those are some of the main issues. I will come back in with some figures at the end. In essence, I want the Minister of State to tell me where we are with regard to moving towards green hydrogen and creating the modus operandiin that regard. Where do we stand and where do we plan to go? What steps are being taken?

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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I thank the Senator for raising this important matter, which is of great interest to me. Scenarios for net zero emissions by 2050 include a potentially significant role for the use of zero-emission gases, including green hydrogen. In planning for the longer term, we will ensure that they can meet their potential.

The Climate Action Plan 2021, published in November, identifies green hydrogen as having the potential to support decarbonisation across several sectors, including: high temperature heat for industry; transport, including aviation and marine fuels and some limited heavy and long-haul ground transport; and, in Ireland, for long-duration electricity storage. The Climate Action Plan 2021 already includes actions relating to green hydrogen in the electricity, enterprise and transport sectors. It also sets out how green hydrogen could address some of the challenges faced by the energy sector, such as providing a backup for intermittent renewables. A key target set out in the climate action plan is to carry out a work programme to identify a route to deliver 1 to 3 terawatt, TW ,hours of zero-emissions gas, including green hydrogen, by 2030.

It is the intention of the Minister, Deputy Ryan, to publish a consultation on the development of a green hydrogen strategy in the first half of this year. As part of this strategy, the Department will first look at the areas of demand where we think green hydrogen will be necessary, competitive, efficient and where better alternatives do not exist. Displacing fossil fuel-derived hydrogen in industry would be a clear and sensible use of green hydrogen. We will not look to incentivise green hydrogen in areas where direct electrification or efficiency would be better solutions. As an example of this, direct hydrogen gas heating would require five to seven times more renewable electricity than a heat pump.

We will also look at supply of green hydrogen, identifying the potential for both dedicated hydrogen production from renewable electricity, but also using curtailed energy from grid electricity. There is a need to rapidly develop green electricity to displace fossil electricity first. However, there may be areas where, through constraints on the grid, green hydrogen may be a more efficient route to decarbonisation of our energy use without the need for additional grid infrastructure.

There are several companies already looking at this opportunity in the midlands and the west. I welcome the recent publication of Wind Energy Ireland’s report, compiled in conjunction with Green Tech Skillnet, on green hydrogen. I also welcome the support of Sinn Féin and its Private Members’ Bill on the development of a hydrogen strategy for Ireland.

The climate action plan is a living document and will be updated on an annual basis to reflect ongoing developments and targets achieved. My Department continues to work with the relevant Departments, agencies and stakeholders to carry out research and develop policies to support the uptake of green hydrogen. I expect a strategy focusing on the development of green hydrogen to be included in the climate action plan 2022. An extensive public consultation process was undertaken as part of the development of the Climate Action Plan 2021. In the future there will be ongoing dialogue with citizens and stakeholders, including public consultation.

In the context of the transport sector, a very important aspect of green hydrogen is its potential to support the decarbonisation of transport. It is envisaged that green hydrogen can contribute to the decarbonisation of those hard to abate sectors, such as those relating to heavy goods vehicles, HGVs, shipping and, potentially - as a synthetic fuel - aviation during the second half of this decade. It also has the potential to be used in the manufacture of synthetic fuels for transport. I am very keen to see Ireland, as an island, lead with decarbonising aviation. We have a significant aviation leasing sector, and I was happy to see its report published recently on the decarbonisation of air travel. It realises that there is a significant risk of stranded aviation assets if it are not at the forefront of decarbonisation.

As part of the renewable fuels for transport policy statement that was published in November of last year, the Minister for Transport announced that from 2023, subject to legislation, renewable fuels of non-biological origin, such as green hydrogen and synthetic fuels produced from it, will be eligible for credits as part of the renewable fuels obligation scheme. Further, in recognition of the need to incentivise their development, they will be awarded multiple credits. Also, under the shared island dialogues, the Department of Transport, together with the Department of the Taoiseach, are progressing projects that will explore the topic of safety regulation for hydrogen as a transport fuel and they will set out a roadmap for the installation of hydrogen refuelling infrastructure servicing travel between Ireland and Northern Ireland.

In addition, the Department of Transport is supporting green hydrogen development through the provision of policy advice for projects looking at the development of green hydrogen infrastructure, such as the Galway green hydrogen hub and Hydrogen Mobility Ireland projects. It is also supporting it through the introduction of the alternatively fuelled heavy-duty vehicle grant in March 2021 and through working with the Minister for Finance to announce, in budget 2022, the expansion of accelerated capital allowance scheme for natural gas propelled vehicles and related equipment to include hydrogen vehicles and equipment.

Photo of Joe O'ReillyJoe O'Reilly (Fine Gael)
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I thank the Minister of State for that response. It is a very positive and encouraging response because one of the things people outside this building will be wondering about is where the action is. The Minister of State indicated that the Minister has committed to publishing a consultation on the development of a green hydrogen strategy in the first half of this year. He also stated that as part of this strategy the Department will look at areas of demand where we think green hydrogen will be necessary, competitive and efficient. The Minister of State further noted that there are several companies already looking to take up this opportunity in the midlands and the west. I humbly suggest that contact be maintained with those companies and that they be kept on the pitch in order that they will continue with their work in this area.

The report we both cited is very encouraging. I take the point that the big thing is to increase the amount of wind energy being produced. Will the Minister of State comment on the offshore wind energy element?

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party)
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In a very concrete way, three buses have been put in place and are operating. They are giving us the experience of knowing what it is like to run longer heavy-duty services. Of course, they do not give rise to pollution or emissions. When hydrogen is burned, all one gets is water. Therefore, it is a very clean fuel. That is giving us some experience.

Hydrogen can be used for all of these different things, but it will not be commercially appropriate in every sector. In fact, we can make a hierarchy of least appropriate to most appropriate. Electricity is something that can be generated but it is very hard to store. Hydrogen gives the ability to take when in excess and then use it when in deficit. It allows us to balance the variability of wind. If it is a very windy day and we cannot use all the electricity being generated, it can be stored somewhere until we can reuse it. In some of the hard to decarbonise sectors, such as the long-distance shipping, aviation and heavy trucking, there is a great deal of potential, even if it is not ideal. For example, for heating a home, it appears that direct hydrogen gas heating is not likely to replace natural gas. As a result, we will be looking at the use of heat pumps instead.

There is an EU hydrogen strategy, which means that this matter is being talked about in Europe as well. The strategy was published in 2020 and it comes with an important new legislative package for hydrogen and decarbonisation. That was completed in December 2021. These two initiatives seek to create the conditions for a shift from natural gas to renewable and low-carbon gases and, in particular, hydrogen and biomethane. We have a very undeveloped biomethane sector in Ireland in comparison with Germany. There is a great deal of room there for what are considered to be alternative gases that do not involve as many climate change aspects and that give rise to much reduced pollution.