Paudge Connolly (Cavan-Monaghan, Independent)
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Question 391: To ask the Minister for Communications, Marine and Natural Resources his proposals to pursue greater electricity interconnection with Europe; and if he will make a statement on the matter. [6131/07]

Noel Dempsey (Meath, Fianna Fail)
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Security of energy supply is a key imperative for Ireland and the European Union. The relatively small size of the Irish electricity market underlines the need for greater interconnection as a means of enhancing security of supply, promoting competition and integrating the Irish electricity market into the wider European market. The Government is committed to deliver enhanced interconnection on the island of Ireland as well as with Britain as a priority. This is also the way forward envisaged at European level.

The Government has approved plans to secure the construction of a single 500 megawatt electricity interconnector between Ireland and Wales. The Commission for Energy Regulation (CER) has been requested to proceed with a competition to select a developer to secure the design and construction of this interconnector as quickly as possible. The CER has also been requested to arrange for EirGrid and ESB to expedite the technical work of route selection and necessary grid reinforcement works. The Government decision provides that the interconnector will as a key strategic asset remain in public ownership and will be owned by EirGrid.

EirGrid has commenced investigation as to the current state of technology and has held a number of meetings with converter station manufacturers, cable manufacturers and utilities. It is currently collating and reviewing sea-bed survey work previously carried out with a view to its currency and availability for use for this project. While work is progressing on the technical specification of the interconnector, the CER, in conjunction with EirGrid, is also finalising the competition structure and related contractual arrangements with a view to going to market as soon as possible. To underpin the development process, new arrangements have been made in respect of the construction and operation of future interconnectors in the Energy (Miscellaneous Provisions) Act 2006. The Act provides that the CER may, with Ministerial consent, secure the construction of an interconnector by one or more means, including by competitive tender. Such consent will be contingent on final Government approval.

In addition to the interconnector with Wales, the Government, working together with the Northern Ireland authorities, is progressing electricity interconnection initiatives in the context of the All-Island Energy Market. In this regard, the two transmission system operators, Northern Ireland Electricity and EirGrid, are progressing a second North-South electricity interconnector which will more than double the existing cross-border electricity transfer capacity to over 600 megawatts to be completed by 2011.

Planning for decisions in relation to further interconnection with Britain or potentially with the European mainland will be developed in the context of the forthcoming White Paper on Energy Policy.

Paudge Connolly (Cavan-Monaghan, Independent)
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Question 392: To ask the Minister for Communications, Marine and Natural Resources his proposals to encourage the exploration and production of indigenous energy resources; and if he will make a statement on the matter. [6132/07]

Noel Dempsey (Meath, Fianna Fail)
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It is Government policy to encourage the exploration and production of indigenous energy resources. The main strategies in support of this policy are regular opportunities for exploration licences through licensing rounds and attractive licensing terms. This year the frontier Porcupine Basin is open for licensing. The planned closing date for applications is end-October, with the award of licences before the end of the year. In addition to such licensing rounds the Celtic Sea is licensed by an 'open door' system under which applications are accepted at any time. My Department also carries out intensive promotional activities directed at encouraging an increased level of exploration in the Irish offshore by participating in major conferences, exhibitions and other promotional events.

My Department is finalising a review of licensing terms at present and I will bring forward my proposals in the coming weeks for the future of the licensing regime.

Bord na Móna plc produces c.3 million tonnes of milled peat annually for supply to the existing three peat-fired electricity generating stations and a further 0.5 million tonnes for the production of peat briquettes. The Government is supportive of the development of co-fuelling existing peat-based electricity generation with biomass. While there are no proposals to increase the use of peat in electricity generation, co-fuelling could extend the use of indigenous peat in the energy mix and introduce indigenous biomass as a co-fuel.

In addition, the Government is promoting renewable energy sources in order to reduce our dependence on imports, with a target to achieve 15% of our electricity requirement by the year 2010.

Paudge Connolly (Cavan-Monaghan, Independent)
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Question 393: To ask the Minister for Communications, Marine and Natural Resources his proposals for restructuring the ESB as recommended in the Deloitte report to enable greater participation by new players in the development and operation of power generation plant; the way challenges to greater participation will be addressed; and if he will make a statement on the matter. [6133/07]

Noel Dempsey (Meath, Fianna Fail)
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I refer the Deputy to the CER-ESB Asset Strategy which was subject of a Memorandum of Understanding on 29 November 2006 and comprises a package of measures to reduce ESB's share of the power generation market in the Single Energy Market to around 40% by 2010. The Asset Strategy formed the basis for the Commission's authorisation to ESB on 6 February 2007 for the construction of a new power station at Aghada.

The Strategy is reinforced by the fact that my approval for the relevant capital expenditure to be undertaken by ESB on the new unit at Aghada is contingent on the company meeting all the terms and conditions accompanying the authorisation by the CER. I should also point out that, in accordance with a recent Government decision on the matter, the output from the new unit at Aghada is to be ring-fenced and sold to suppliers other than ESB PES.

The CER-ESB divestment package is in keeping with policies put forward in the Green Paper on Energy, Towards a Sustainable Energy Future for Ireland, and is a viable first step in the development of a competitive electricity generation sector within the context of the development of the All-island market.

Paudge Connolly (Cavan-Monaghan, Independent)
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Question 394: To ask the Minister for Communications, Marine and Natural Resources the action that should be taken in addition to electricity generation, to develop renewable energy usage in the transport and heat sectors; and if he will make a statement on the matter. [6134/07]

Noel Dempsey (Meath, Fianna Fail)
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A number of innovative alternative energy programmes are in place as part of the Government's strategy to stimulate renewable energy deployment across the electricity, heat and transport sectors. A series of grant-aid programmes are being rolled-out over a five year period and are providing funding for the domestic, commercial, services and industrial sectors as follows: the €47m 'Greener Homes' domestic renewable heat grants programme is providing grants for householders for the purpose of installing renewable heating including wood biomass boilers and stoves, solar panels and heat pumps; he €26m Bioheat grants programme provides grants for commercial scale wood biomass boilers aimed at the business and services sectors and is currently being expanded to enable the community and voluntary sector to avail of grants and to include other technologies such as solar; and the €11m Combined Heat and Power grants programme is providing funding for the commercial sector to switch to more efficient electricity and heat generation.

A number of other financial initiatives have also been introduced: In June 2006, I launched the Renewable Energy Feed-in-Tariff which is providing a fixed feed-in-tariff for renewable electricity over a fifteen year period which will assist in achieving a target of 15% electricity consumed from renewable sources by 2010. In July 2006 I launched a five-year excise relief programme for biofuels, valued at over €200m. There were sixteen successful applicants under this scheme. The programme builds on a pilot initiative rolled out in 2005, in which eight biofuels project were granted excise relief over a two-year period. In addition to the excise relief programmes for biofuels on 12th February I signalled my intention to introduce a Biofuels Obligation by 2009, which will require all fuel suppliers ensure that biofuels represent a certain percentage of their annual fuel sales. The obligation will deliver a target of 5.75% market penetration in 2009 and 10% in 2020.

The Bio Energy Action Plan, to be published shortly, will set out a cohesive strategy for the development and deployment of indigenous bioenergy resources, in the electricity, heating and transport sectors. Strategies for renewable heat, electricity and transport will also be addressed in the forthcoming White Paper on Energy Policy.