Ireland and UK energy ministers talk energy security and exports

The UK and Irish energy ministers made history yesterday at the National Offshore Wind (NOW) Ireland conference as they both spoke about the two islands’ opporunity to build their export markets for renewable energy, as well as looking at how Ireland and Britain can each have confidence in security of supply from the other, particularly with the completion of the East West interconnector, built by EirGrid, in Spring 2012.

The main topics discussed at the conference was that Ireland has a €60bn investment opportunity on its doorstep, as well as how the Irish Government must create an environment for meaningful public private partnerships.

Offshore wind development was also described by NOW Ireland as a “front-loaded investment”, which could begin immediately, and can be a magnet for foreign direct investment (FDI) and job creation.

Speakers on the day included Ireland’s Minister for Communications, Energy & Natural Resources, Pat Rabbitte TD; the UK’s Minister of State at the Department of Energy & Climate Change, Charles Hendry MP; Sean O’Driscoll, CEO, Glen Dimplex Group; Andy Kinsella, CEO, Offshore, Mainstream Renewable Power; Rob Leonard, director of European Business Development, Centrica.

The speakers touched on how the development of offshore wind industry in Ireland, predominantly export-based, can propel new job creation, especially in the supply chain, as well as attracting FDI to Ireland.

Brian Britton, general secretary of NOW Ireland, asserted that the exporting of renewable energy and particularly offshore wind can be at the forefront of the recovery of the Irish economy, whether it is through direct connection of Irish wind farms to the UK or through interconnection with a far broader energy market in the European Union.

“The quality of our renewable energy resources, particularly wind, mean that Ireland can be the driving force in ensuring that EU climate change targets can be met. The EU will need us and if we can deliver we will have a market for clean green Irish energy,” said Britton.

Right now, there are about 2,800MW of offshore wind in advanced planning in Irish territorial waters. Developing this would mean an investment of over €8bn, much of which would be based on FDI, according to NOW Ireland

Supply chain jobs around wind energy

In addition to the direct investment in projects, Britton said there is an opportunity for Ireland to develop jobs in the supply chain for wind farm deployment and operation and maintenance.

In total, in the Irish Sea zone, principally from UK-based projects, NOW Ireland predicts that there will be an investment of €60bm in offshore wind projects.

Britton spoke about how the Governments had referenced the need for PPPs at the recent launch of the Capital Investment Programme.

He said that offshore wind development was a “front-loaded investment”, which could begin immediately.

“This industry is offering the economy a huge, front-loaded investment. We are offering the means of meeting our treaty obligations, of creating jobs and securing our energy security. This is a genuine public private partnership. We will bring the investment and the experience. We ask only that the Government creates the environment necessary to make this happen,” said Britton.

NOW Ireland appeals for longer-term renewables vision from Government

Britton argued that what was required now was vision and not short-term thinking.

“We appreciate the challenges that Government face. It is critical, however, that in dealing with our short-term challenges we do not lose sight of our opportunities. Energy is a long-term investment. Offshore wind provides Ireland with an incredible opportunity to create badly needed jobs, inward investment and growth in a new indigenous sector, using our natural physical advantages.”

On the issue of renewable energy targets Britton said that offshore wind could be a critical hedge for the Government in achieving their targets.

The National Renewable Energy Action Plan indicates that 550MW of offshore wind should be developed for domestic use by 2020. Britton highlighted concerns that despite the substantial resources at Ireland’s disposal, domestic targets could be missed.

Investors are asking why offshore wind has not happened in Ireland

“Domestic targets should be easily achieved. We are sitting on one of the best wind regimes in Europe. We have the best sites, sites which would have been developed in any other of our competitor European countries. We have the projects ready to go. We have Irish and international investors ready to facilitate the development of these projects. These investors are asking why offshore has not happened in Ireland,” explained Britton.

“All that is now required is for the Government to send the REFIT application to Brussels, the REFIT for offshore which was first raised by Dermot Ahern in 2002 and which has been publicly supported and endorsed by each successive Government and Opposition since then. Then we would be on a level playing field with each of our neighbours in north western Europe,” asserted Britton.

Minister Rabbitte TD answered the crucial REFIT question

Ireland’s Energy Minister, Pat Rabbitte TD, was then asked when exactly was he going to make the application for State aids clearance for REFIT for offshore wind. He said he was hopeful to “be in a position to go to Government before Christmas”.

Minister Rabbitte’s response in full was: “Only in the last couple of weeks did we get State aids clearance for REFIT for biomass and other technologies. The application in respect of REFIT 2 has been in the system for a very long time but I would be relatively hopeful.  I would be very disappointed if we don’t get approval within the next couple of weeks in that regard.  As regards REFIT for offshore, I hope to be able to go to Government reasonably soon.  The circumstances that are preoccupying Government at the moment are to do with the general financial and economic environment that we are in, and immediate budgetary preparations, but I hope to be in a position to go to Government before Christmas.”

Ireland and the UK – greater collaboration on renewable energy

The UK’s Energy Minister Charles Hendry spoke about how we need to embrace the opportunities that renewable energy and further market integration brings.

He said that the movement towards a single European energy market would present a real opportunity for Ireland and the UK to “achieve substantial revenue benefits from electricity exports”.

“A very tangible step forward will take place in the spring with the coming on line of the East West interconnector, built by EirGrid,” said Minister Hendry. This interconnector build by Ireland’s transmission operator EirGrid will serve to double the interconnection capacity between the island of Ireland and Britain.

“[…] hope that its success and utilisation will lead to further growth in interconnection between Britain and Ireland in the coming years,” said Hendry.

As well as exports, Hendry said there are other benefits from deeper co-operation and greater energy trading between Britain and Ireland.

“As trusted friends, with close personal, business and government to government connections, Britain and Ireland can each have confidence in security of supply from the other. Much of Ireland’s gas comes through Britain and we would welcome Irish-generated electricity forming part of Britain’s energy mix. We hope that our open and competitive energy market will make it possible for Irish companies to increase their market presence there in the future. There is clear political commitment behind this co-operation.”

Henry also reminded those at the conference that earlier this year Ministers from the Governments of the United Kingdom, the Northern Ireland Executive, the Irish Republic, the Channel Islands and the Isle of Man signed up to co-operate on exploiting the major wind and marine resources in and around the islands

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