Jerry Cowley (Mayo, Independent)
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Question 156: To ask the Minister for Communications, Marine and Natural Resources if he will commission an urgent feasibility study into the need to replace the existing peat power station, which is closing down with the loss of more than 200 jobs, with a new peat burning 100 megawatt power station (details supplied). [7271/05]

Noel Dempsey (Meath, Fianna Fail)
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I do not propose to commission a feasibility study into the need, or otherwise, for any further peat-fired electricity generating plant. The location, construction and operation of electricity generating stations are liberalised activities in an open and competitive market. An authorisation is required to construct a generating station and a licence is required to generate electricity as prescribed by the Electricity Regulation Act 1999. These are issued by the Commission for Energy Regulation, CER. Responsibility for security of supply also rests with the CER. In addition, planning permission is required from the local authority concerned and a grid connection must be secured from ESB national grid. Appropriate licences and authorisations, such as an integrated pollution control licence from the Environmental Protection Agency, are also necessary.

I do not have a function in any of these matters. It is a matter, therefore, for market players to undertake whatever feasibility studies they deem necessary in order to make a commercial decision on whether or not to enter the electricity market. The Deputy will be aware that public service obligation, PSO, arrangements, which were notified to the EU Commission in November 2000, are in place in respect of peat generation for security of supply reasons. These arrangements provide for the use of peat in three generating plants in the Midlands — one independently owned and operating since December 2000, and two owned and operated by the ESB.

The PSO levy, which is charged to all consumers and impacts on the country's energy costs, compensates the ESB for the additional costs incurred in using peat in electricity generation. I am satisfied that the level of peat in the generating fuel mix is sufficient. I do not believe there is an adequate basis for reopening this issue with the EU Commission.