Written answers

Tuesday, 16 July 2013

Department of Communications, Energy and Natural Resources

Public Service Obligation Levy Payments

Photo of Kevin HumphreysKevin Humphreys (Dublin South East, Labour)
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727. To ask the Minister for Communications, Energy and Natural Resources the amount on an annual basis from 2007 to date in 2013 that was provided as a subsidy to Ireland's three peat burning power stations; if all of this subsidy came from the PSO levy; and if he will make a statement on the matter. [35391/13]

Photo of Pat RabbittePat Rabbitte (Dublin South West, Labour)
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The Public Service Obligation (PSO) levy has been in place since 2001 and is the overall support mechanism for peat generation, for certain conventional generation constructed for security of supply purposes, and for the development of renewable electricity. The levy is designed to compensate electricity suppliers for the additional costs they incur by purchasing electricity generated by these producers, including the three peat stations. Peat-fired electricity plants are supported by the PSO levy as they contribute to security of supply through the use of indigenous fuels. The levy is paid by electricity customers on their bills. It acts as a price support to peat, renewable and security of supply electricity generation and is therefore not a subsidy paid from public funds.

The particular PSO scheme for peat generation was approved by the European Commission in 2001 and was designed to enable the accelerated closing down by ESB of the then existing six old peat fired plants and the building of two new more environmentally friendly and efficient plants with a 15-year operational lifetime. The PSO also applied to the peat fired plant in Edenderry which is now owned by Bord na Móna. The peat PSO for Edenderry expires in 2015 and Bord na Móna is incrementally increasing the co-firing of biomass with peat. The PSO for the two ESB peat stations expires in 2019.

The specific information requested by the Deputy, including the various breakdowns and historical data, is publically available on the Commission for Energy Regulation's website at the following link:

Photo of Kevin HumphreysKevin Humphreys (Dublin South East, Labour)
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728. To ask the Minister for Communications, Energy and Natural Resources the length of time for which the PSO levy to subsidise peat burning power stations will continue; his views on whether it is the most efficient use of public subsidies which could be allocated to renewable energy sources which would also contribute to reducing our carbon emissions; and if he will make a statement on the matter. [35392/13]

Photo of Pat RabbittePat Rabbitte (Dublin South West, Labour)
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The Public Service Obligation (PSO) levy has been in place since 2001 and is the overall support mechanism for peat generation, for certain conventional generation constructed for security of supply purposes, and for the development of renewable electricity. The levy is designed to compensate electricity suppliers for the additional costs they incur by purchasing electricity generated by these producers, including the three peat stations. Peat-fired electricity plants are supported as they contribute to security of supply through the use of indigenous fuels. The levy is paid by electricity customers on their bills. It acts as a price support to peat, renewable and security of supply electricity generation and is therefore not a subsidy paid from public funds.

The particular PSO scheme for peat generation was approved by the European Commission in 2001 and was designed to enable the accelerated closing down by ESB of the then existing six old peat fired plants and the building of two new more environmentally friendly and efficient plants with a 15-year operational lifetime. The PSO also applied to the peat fired plan in Edenderry, which is now owned by Bord na Mona. The PSO for Edenderry Power expires in 2015 and Bord na Mona is incrementally increasing the co-firing of biomass with peat. REFIT 3, which opened last year, aims to support co-firing of biomass at all three peat stations. The PSO for the two ESB peat stations expires in 2019.

The PSO levy also supports renewable energy technologies used to generate electricity under the Alternative Energy Requirement (AER) scheme, launched in 1995 and under the Renewable-Energy-Feed-in-Tariff (REFIT) scheme. The first phase of REFIT was launched in 2006 with subsequent schemes opening in 2012.

I have no plans to end the PSO for peat in advance of the dates for their expiry under the European Commission approvals.

Photo of Kevin HumphreysKevin Humphreys (Dublin South East, Labour)
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729. To ask the Minister for Communications, Energy and Natural Resources if he will provide an annual breakdown from 2007 to date in 2013 of the amount raised in the electricity PSO levy; the rate of levy for each of those years; the amount of the levy that came from commercial or residential/personal electricity consumption; if he will provide an annual breakdown of the amount of the levy that was distributed and to which power generators and specifically for which power stations or wind farms; and if he will make a statement on the matter. [35393/13]

Photo of Pat RabbittePat Rabbitte (Dublin South West, Labour)
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Responsibility for the regulation of the electricity and gas markets including the operation of the Public Service Obligation (PSO) levy, is a matter for the Commission for Energy Regulation (CER), which is an independent statutory body.

The Public Service Obligation (PSO) levy is charged to all electricity customers. It is designed to support the national policy objectives of security of energy supply, the use of indigenous fuels (i.e. peat) and the use of renewable energy sources in electricity generation, as set out in legislation. The proceeds of the levy are used to recoup, inter alia, the additional costs incurred by electricity suppliers in sourcing, and ESB Power Generation producing, a proportion of their electricity from such generators.

Section 39 of the Electricity Regulation Act 1999 sets out the legal basis for the PSO levy in Ireland. Statutory Instrument No. 217 of 2002 made under Section 39 of the Electricity Regulation Act requires that the CER calculates and certifies the costs associated with the PSO and sets the associated levy for the required period. The PSO levy takes into account the estimated and actual costs incurred in undertaking generation activities which are covered in the relevant PSO legislation. Articles 8 and 9 of Statutory Instrument 217 of 2002 set out the methodology of the calculation of the components of the PSO levy and the estimation of the amount of the PSO levy by the CER.

The specific information requested by the Deputy (including the various breakdowns and historical data) is publically available on the CER website at the following link:

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