Written answers

Tuesday, 8 November 2005

Department of Community, Rural and Gaeltacht Affairs

Alternative Energy Projects

8:00 pm

Photo of Brian O'SheaBrian O'Shea (Waterford, Labour)
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Question 469: To ask the Minister for Community, Rural and Gaeltacht Affairs his proposals to have research carried out into the viability of ethanol production as a potential rural and Gaeltacht industry to the benefit of employment and farm income; and if he will make a statement on the matter. [32690/05]

Photo of Éamon Ó CuívÉamon Ó Cuív (Galway West, Fianna Fail)
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The Department of Communications, Marine and Natural Resources is responsible for the promotion and development of renewable energy, including biofuels. In 2004, the Finance Act 1999 was amended to provide for the introduction of a scheme for mineral oil tax relief for biofuels. A scheme under the Act was launched by the Department of Communications, Marine and Natural Resources in April 2005. A total of 34 applications were received under the call for proposals by the closing date and eight projects were awarded excise relief under the scheme. Excise relief of €6 million will be allowed for the successful projects over a two-year period to 2007. The scheme was open to applicants from all areas, including rural and Gaeltacht areas and is an initial measure designed to stimulate market development.

Under Sustainable Energy Ireland's renewable energy research, development and demonstration programme, capital grant aid is also available for biofuels market demonstration projects in the pure plant oil, biodiesel and bioethanol categories. Funding of almost €250,000 has already been awarded to support engine modifications of up to 100 vehicles and provide plant and monitoring equipment.

In addition, SEI has provided grant aid of €40,000 to Teagasc for a study to establish oil quality testing procedures for pure plant oil. This study will be critical to building market confidence. SEI also provided funding for the publication of a resource study on recovered vegetable oil and animal fats and study on quality assurance for rapeseed oil as a vehicle fuel.

In 2004, SEI published a liquid biofuels strategy study for Ireland which examined the full range of options and potential supports for liquid biofuels development in Ireland. I understand that the Minister for Communications, Marine and Natural Resources has had contact with the Minister for Finance about the possible scope for scaling up fiscal support for biofuels. In the circumstances, there are no plans in this Department to carry out further research in this area. However, as part of the Department's overall remit with regard to Gaeltacht and rural development matters, we continue to maintain a close interest in these matters.

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