The Irish Wind Energy Association (IWEA) has welcomed the signing of an historic deal between Ireland and the UK Government that will potentially pave the way for exploiting Ireland’s unique wind energy resources. Both Governments have agreed to co-operate on developing the major wind and marine resource in and around Ireland, the Channel Islands and the Isle of Man.

IWEA chief executive Dr Michael Walsh says the deal may be seen in time as a milestone moment for Ireland in terms of maximizing the potential of the wind sector.

“It’s early days yet and we await the detail of what’s in the deal but it certainly is a major step in the right direction and potentially paves the way for what we believe could be a €1.6 billion annual export industry for Ireland and total new employment in the sector of 28,000 jobs,” he explains. “This deal, perhaps more than anything else that has gone before recognises the huge potential from wind energy on the island of Ireland given that it is a trading partner and not just ourselves that has recognised that the wind resource we have here is unique and largely underutilised. We have long since in the IWEA trumpeted the potential for exporting wind energy from Ireland and this deal will hopefully bring it to fruition, sooner rather than later.”

Rising fossil fuel prices, devastating oil spills and the nuclear crisis in Fukushima have in 2011 substantially raised expectations of wind energy. Every month in 2009 and 2010, the global wind energy industry installed new wind energy capacity that can produce as much electricity as 1.2 average nuclear reactors.

According to the wind industry, in 2015 wind power will avoid €23.7 billion of fuel costs – made up of €15.1 billion of avoided coal costs, €6.4 billion of avoided gas costs and €1.7 billion of avoided oil costs to produce electricity. By 2020 wind power will reduce fuel costs by €87 billion globally – made up of €46 billion of gas costs, €27 billion of coal costs, almost €10 billion of oil costs and €4 billion of biomass costs required to produce electricity.

These figures are based on the International Energy Agency’s data on fuel costs (IEA World Energy Outlook 2010) and Global Wind Energy Council data (GWEC, 2011, Outlook 2010) on ‘moderate’ development of wind power.

Dr Michael Walsh, chief executive of the Irish Wind Energy Association.

Opportunity For Ireland

Ireland is showing real signs of grasping the opportunity for developing smart technologies to facilitate the massive hike in demand for global wind energy over the next decade, says to Dr Michael Walsh, chief executive of the Irish Wind Energy Association (IWEA).

“There is a unique opportunity for Ireland’s innovators and entrepreneurs to develop new business of a global scale arising from the huge demand for wind energy up to 2020 and beyond.,” he comments. “This is an opportunity for Ireland in terms of wind generation but also in developing the technologies to ensure this capacity is delivered.”

He continues: “As countries all over the world are moving more and more towards wind generation, the market for these services will be immense. Ireland has the technical expertise and the opportunity to lead this new global industry. We also have the perfect combination of small local innovative companies and global technology leaders based in Ireland.”

The Irish Wind Energy Association (IWEA) has stated that the ESRI ‘Review of Irish Energy Policy’ is an important reminder that Ireland is far too dependent on importing its energy supply from other nations and needs to accelerate the move towards maximising our own resources. However, responding to the report, IWEA chief executive Dr Michael Walsh says that any reduction in current supports would undermine investment, cost jobs and result in Ireland potentially failing to meet its EU 2020 renewable energy targets.

“A reduction in supports would most definitely be a major setback for a sector that is more than justifying these same supports but is going to deliver savings to the consumer and create export revenue for Ireland in the future as well. A recent study by international energy analysts Redpoint on the Irish market showed that wind energy generation will deliver savings to Irish consumers of Eur100m by 2020. This demonstrates that wind generation does not add cost in today’s market let alone in the future when we can become an exporter of renewable energy,” he points out. “In that regard, any reduction in the current supports will be a set-back. It will deny investment and, therefore, potentially lead to higher prices, higher emissions, continued imported fuel dependence and a missed opportunity to create thousands of new jobs.

He continues: “This ESRI report, if anything, reaffirms that we are way too dependent on external sources of energy, with approximately 89% of our energy requirement being imported, and justifies the need for accelerating our wind energy programme. What we need now is to develop our own unique resources as quickly as possible to reduce this excessive dependency on what are long term unreliable and, from a price perspective, volatile international energy sources.”

Ireland has strong onshore and offshore wind resource yet last year, due to a lack of co-ordination, Ireland saw only 115MW of onshore wind built – approximately a third of what needs to be built annually to meet our targets. The IWEA is calling on the Government to introduce a co-ordinated energy and enterprise implementation plan to ensure we deliver as much capacity as possible and to develop a major income stream for Ireland by becoming a leading European exporter of wind energy.

“Specifically, we can ensure that Irish projects play a part in meeting the UK’s energy needs as we will have the resources to meet over 15% of the UK’s 2020 renewable requirements in a highly cost effective fashion for UK consumers. This would result in additional jobs and investment in Ireland and ongoing export revenues,” says Michael Walsh.

The growing importance of wind as a key energy resource for Ireland was reaffirmed recently as a record power output level of 1,323 megawatts – enough to power more than 850,000 homes – was recorded, the Irish Wind Energy Association (IWEA) has revealed. According to figures available from Eirgrid, the new record was achieved on Monday, April 4th at 9.45am.

Two and three quarters hours earlier, the amount of electricity being generated from wind was just under 50% of national electricity demand at that time.

EirGrid monitors and matches electricity generation and usage nationally 24/7 at its headquarters in Dublin.

“This record confirms the impact that wind energy can have. We have seen records broken on a number of occasions recently and as we continue to grow this sector in 2011, we are developing knowledge and skills that the rest of the world will need in the coming decade,” comments Michael Walsh, chief executive of  IWEA. “Ireland is leading the way and showing that high wind levels are achievable which brings with it opportunities to advance Ireland’s strategy for economic renewal.”

Ireland currently has 1,425MW of installed wind energy across the Republic, with over 1100MW contracted and 3900MW receiving grid connections in the next phase of Grid Connections, Gate 3. Outside of this there are over 11GW of wind energy projects awaiting Grid connection, which signals a major increase in the energy that will be available in future from this natural resource.

Ireland will generate enough renewable energy by 2040 to effectively cover 100% of the nation’s energy requirements, according to Peter Harte, chairperson of the Irish Wind Energy Association’s Markets Committee. He also sees Ireland becoming a carbon-free power and transport nation, with most, if not all, of our current fossil fuel plants decommissioned by then.

“While there may still be some fossil fuels used in shipping and aviation, we could easily generate and export so much wind energy by 2040 from Ireland that the net effect is that we are 100% powered by renewable energy by then,” he explains. “Fossil fuel plants run for 30 to 45 years so decisions we made, even in the last few years, are already determining our energy mix in the years ahead. So much has been concentrated at an Irish and EU level on meeting 2020 targets that there is an energy policy vacuum beyond that and we really need to start thinking ahead.”

He continues: “Europe has already published its ‘Roadmap to a low carbon society’, which outlines the need for a fully decarbonised power sector by 2050 and we need to start thinking and acting long term as well, not least as this presents both challenges and opportunities for Ireland. If we are to achieve a carbon-free power sector by 2050, then no new carbon-emitting plants can be built after 2015. If electricity then is carbon-free, we can potentially have a decarbonised transport system.”

Other elements of his 2040 energy vision include:

* A decarbonised heating system by virtue of heat pumps delivering 4kW of green heating output for only 1kW of green electricity input.

* A reduction in energy demand by 20-30% due to energy efficiency initiatives (principally electric vehicles, heat pumps and insulation).

* Ireland will be heavily interconnected with European electricity (and hence energy) markets.

* Ireland will contribute vast quantities of the renewable energy – wind, tidal and wave – requirements for Europe as we will produce it cheaper than anywhere else.

* In return Ireland will purchase flexible low carbon energy from Europe (solar from Spain, nuclear from France, hydro from Norway, biomass from Eastern Europe etc.).

An over-complicated bureaucratic system is significantly hampering job creation and investment in the Irish renewable sector, according to the Irish Wind Energy Association.

IWEA chief executive Dr Michael Walsh says that excess bureaucracy and unnecessary risk is driving investors away from what should be a thriving market.

“The absence of a coordinated and cohesive system for facilitating the delivery of required installations to meet our 2020 targets is resulting in an unstable market for investment. Such is the instability that last year we saw a 58% drop (Eur265m) in the level of investment in the wind sector in Ireland,” he explains. “Investors are lined up and ready to go but the framework for investment is simply too volatile. Many rules and processes are under review and there is no overall co-ordination of the consents needed to make an investment in renewable energy in Ireland. Investors are being asked to make substantial financial commitments in advance of clarity on the regulations that will apply in the future. International financial providers are still interested in Ireland but they will no longer accept this level of uncertainty.”

Dr Michael Walsh, chief executive of IWEA.

Indeed, the IWEA has spoken with a number of local and international banks who said they would like to continue funding renewable projects in Ireland but are increasingly concerned about the ever changing policy framework. “We need to provide these investors with a clear set of rules that they can analyse to bring efficient investments to Ireland,” he says. “The absence of a joined up approach has resulted in wild swings in the volume of activity in the sector. For example, we installed 250MW of wind in ’06 and then just 50MW in ’07. In ’09 we had 230MW installed but last year that was down to 115MW. The real shame is that this volatility makes it more difficult for local companies to capitalise on what should be a thriving sector. They will not speculate or invest in a market that fluctuates like ours does.”

Ireland needs to install over 300MW per year for the next nine years to deliver on its 2020 targets of 40% of electricity from renewable energy sources. The IWEA’s Deloitte report of 18 months ago illustrated that this could create over 10,000 jobs in Ireland but it also warned that consistent delivery would be necessary to create a solid platform for enterprise and job creation.

Dr Walsh elaborates: “Based on current inconsistent trends we could end up trying to rush through 900MW per year in four or five years time. This instability means we will not develop an indigenous supply chain to service the market. As a result, we will have to bring in people from other countries such as Denmark and Germany that have developed their industries and skills to do this work and Ireland will have missed out on high value job creation opportunities as a result.”

However, the new Government, if it acts quickly, can eradicate these problems. “What we need is a robust management system for the industry, where official bodies communicate with each other and work to make the sector business friendly and effective. The appointment by Minister Rabbitte of an ‘Energy Tsar’ within his department to co-ordinate energy and enterprise policy would certainly be a crucial first step,” he adds. “We should also urgently commence negotiations with the UK to ensure that Irish projects can play a part in meeting the UK’s energy needs. We will have the resources to meet over 15% of the UK’s 2020 renewable requirements in a highly cost effective fashion for UK consumers. This would result in additional jobs and investment in Ireland and ongoing export revenues.”

The IWEA chief concludes: “We could be world leaders in smart energy technology and green finance but we need to stop putting barriers in the way of enterprises that want to help us meet our national targets and reduce our energy costs.”

The director of one of Europe’s leading energy producers and owner of indigenous Irish energy supplier Airtricity has warned that Ireland is being left behind in the development of offshore wind and marine generation. Addressing over 400 delegates at the annual conference of the Irish Wind Energy Association, Scottish and Southern Energy Group finance director Gregor Alexander said that this is resulting in a significant lost opportunity for the Irish economy and job creation here.

“Returns on our Irish onshore wind farms are marginal. More attractive returns are available in the UK. Of even more concern is that Ireland is being left behind in the development of offshore wind and marine generation. These technologies offer considerable export and job opportunities but Ireland is not maximising them,” he said.

Mr Alexander pointed out that for the renewable sector here to reach its true potential it needs to forge ahead with market coupling with the UK and to broaden its interconnection plans from just linking with the UK to include an interconnection to France as well.

“As a very small market in European terms Ireland, at a minimum, needs profound interconnection and market coupling with the UK. Coupling would bring economies of scale, a more diverse generation portfolio, the opportunity to export renewable electricity and ensure customers benefit from increased competitive energy supply,” he elaborated. “We would also encourage Ireland to go further seeking interconnection further afield. In Scotland, for example, we are looking to Norway and Iceland to tap into hydro and geothermal resources respectfully.”

An interconnector from Ireland to France would not only access French power in winter but it would provide an export opportunity in summer for Ireland’s generation fleet to supply France’s air conditioning load.

The Scottish and Southern Energy finance director also said that a more pragmatic approach to planning issues is also required in Ireland to bring an end to the current conflict between Irish energy and planning.

For example, SSE Renewables was recently refused planning permission on the basis of ‘the negligible probability’ that the proposed wind farm could pollute a water body some 25KM away, despite having recently completed a wind farm adjacent to a water body.

Pat Rabbitte TD, Minister for Communications, Energy & Natural Resources, in what will be his first official address at an energy sector event since his appointment as Minister in the new Government, will open the annual Irish Wind Energy Association (IWEA) wind energy conference tomorrow – Thursday, March 24th.

The event, which continues on March 25th at the Four Seasons Hotel in Dublin, is the largest annual conference for the wind energy sector in Ireland.

Titled ‘Renewing Ireland’, the conference is sponsored by SSE Renewables and will focus on what is required to maximise the enormous opportunity for the renewable energy sector to deliver long-term sustainable economic and environmental benefits to Ireland. Over 20 national and international experts in the renewable energy field will address the conference over the two days on a range of topics.

Energia will be the biggest purchaser of the renewable energy produced by Ireland’s growing number of wind farms in 2011, according to new figures from the Irish Wind Energy Association. Responding to the massive increase in demand from Irish businesses for ‘green’ power, Energia is set to grow its renewable energy portfolio by over 268 megawatts (MWs) this year.

The vast majority of this, 243 MW, will come from 26 new Irish windfarms that will become operational during 2011. This equates to 68% of the total new electricity generated by Ireland’s wind farms this year, making Energia by far the largest purchaser of new Irish wind farm power.

Peter Baillie, managing director of Energia Renewables.

Last year 115 MWs of new generating capacity from Irish wind farms was connected to the national grid, over 40%of which is in Energia’s portfolio. In 2011 this figure is set to rise to around 400MWs.

Peter Baillie, managing director of Energia Renewables, comments: “In response to the growing number of Irish businesses asking for green power, Energia’s renewable power portofolio is set to grow by 268 megawatts (MW) this year. 25MWs will come from our Energia wind farms and 243 MWs will come from new wind farms all over Ireland. This makes us by far the biggest purchaser of new wind power capacity in Ireland.”

He continues: “We have signed a large number of power purchase agreements (PPAs) with new wind farm developments all over Ireland, including locations in counties Carlow, Cork, Donegal, Kerry, Leitrim, Limerick, Mayo, Roscommon, Tipperary and Wexford.”

In addition to these PPAs, Energia already runs a large number of its own wind farms throughout Ireland in locations such as Donegal, Roscommon and Sligo. The company is also in the final stages of developing new wind farms in Caherdowney, County Cork, Meenadreen. County Donegal, and Hollyford, County Tipperary.

“We also recently raised a Eur72 million in financing for our latest group of renewable projects, bringing our total wind farm financing to Eur115m in the last two years,” he point out. “At the moment we are very focused on expanding our renewables business.”

Wind energy generation will deliver savings to Irish consumers of €100m by 2020, the most detailed analysis to date into the value of the sector has revealed. The report, commissioned by IWEA (Irish Wind Energy Association) in conjunction with Wind Skillnet, was compiled by international strategic and analytical consultancy Redpoint Energy. It found that an 11.5% reduction in wholesale electricity prices will be achieved through delivering 45% of the overall generation mix from wind by 2020. The publication of the report coincides with the launch of a Wind Skillnet training course on the outcomes of the analysis.

Titled ‘The impact of wind on pricing within the Single Electricity Market’, the analysis focused solely on the impact that wind generation has on two components of consumer bills; wholesale electricity prices and renewables support.

Through Redpoint’s modelling it examined the potential impact of varying levels of wind energy on wholesale electricity prices and the resulting cost of power to the consumer. The study reveals that wind generation is already having a significant impact on energy costs, with the total savings to consumers set to reach Eur36.6m in 2011. Wind energy currently accounts for approximately 12% of Ireland’s electricity needs.

Under the scenarios studied, consumers are shown to pay less through the support mechanisms than the savings they make from lower wholesale power prices.

“Our analysis shows that increased levels of wind generation will displace coal and gas-fired generation, and reduce the costs of electricity production,” says Phil Grant, director, Redpoint Energy. “Wholesale energy prices and therefore costs to consumers fall as the volume of wind energy increases. Although renewables generation across the island of Ireland require a subsidy from the consumer, on the basis of the commodity prices assumed in this analysis, the reduction in consumer costs is greater than the subsidy paid. If oil, gas and coal prices actually turn out to be higher than assumed in the analysis the relative savings to the consumer from having wind on the system could well be even greater.”

Dr Michael Walsh, chief executive of IWEA.

Dr Michael Walsh, chief executive of IWEA, adds: “This report demonstrates that wind generation does not add cost in today’s market, nor indeed in the future. In fact, it reduces the cost of generating electricity plus the price to the end user. We have separately quantified the costs to the consumer of developing new transmission lines to connect wind generation. Comparing the costs expected in the Grid 25 development plan with a business-as-usual scenario we find that customers will save almost Eur100m per year. This is because the saving in wholesale process of Eur256m greatly outweighs the costs of PSO support of Eur52m and the annual costs of new network of Eur108m in 2020.”

Dr Michael Walsh continues: “In simple terms, meeting our renewable energy targets will result in lower prices, lower emissions, greater fuel security and the opportunity to create thousands of new jobs. We now call on the government to introduce a co-ordinated energy and enterprise implementation plan to ensure we capture our share of these new European industries.”

A new study on the Irish electricity system has revealed that the growing levels of wind generation on the Irish electricity network are not adding to the wholesale price of electricity. The report by grid operator EirGrid and the Sustainable Energy Authority of Ireland, uses detailed modelling tools to look in detail at the wholesale prices in the Irish electricity system in 2011, which has a total annual value of almost €2 billion

The analysis showed that wind generation lowers wholesale prices by over €70 million, which almost exactly offsets the costs of the Public Service Obligation (PSO) levy and other costs associated with the generation of wind energy. The study clearly demonstrates that wind energy is not contributing to higher wholesale electricity prices on the Irish electricity system.

Wind generators have high capital costs, but as they do not consume fuel they have no short-term costs. By displacing higher cost fossil fuel generation, wind energy tends to reduce the wholesale cost of producing electricity, the study has found. When balanced against other costs, the overall cost impact of wind is less than half of one percent, which is within the study’s margin of error.

The increased use of wind energy on the Irish electricity system increases Ireland’s security of supply and ensures a more diverse fuel supply in the long-term.

Dermot Byrne, chief executive of EirGrid, says: “Reliable, economic and sustainable power is crucial to Ireland’s future. Renewable energy can play an important part in the energy mix but it is important to continuously look at the effect on prices of all sources of energy, in the interest of consumers. This report is a significant contribution to that.”

Dr Brian Motherway, chief operations officer of SEAI.

Dr Brian Motherway, chief operations officer of SEAI, remarks: “It is important that our energy debates are based on solid facts and clear evidence. This detailed analysis answers an important question – that exploiting our strong wind energy resource comes at no additional cost. It is right that we keep a focus on energy costs, and it is very good news to see that we can capture the benefits of wind energy without having to pay extra for them. And as fossil fuel prices increase the economic benefits become more significant.”

IWEA (Irish Wind energy Association) has today welcomed the publication of the Eirgrid/Sustainable Energy Authority of Ireland study. “The report is further proof that Ireland’s most abundant and environmentally friendly natural energy resource, wind, can be harvested without any additional cost to the consumer,” comments Dr Michael Walsh, chief executive of IWEA. “The study, we anticipate, will be supported by the findings of our own comprehensive report, titled ‘The Impact of Wind on Pricing Within the Single Electricity Market’, which will be published on March 1st. This report, which was conducted by international specialist energy consultancy Redpoint, follows an in-depth analysis of the impact that wind generation has on two components of consumer bills; electricity prices and renewable support.”

According to data from EirGrid, Ireland’s wind farms hit a new record power output level of 1250 megawatts, enough to power over 800,000 homes around Ireland.

“We have seen records in 2010 broken where there were times when we delivered over half of the electricity in Ireland from wind generators,” comments Michael Walsh, chief executive of Irish Wind Energy Association (IWEA). “As we continue to grow this sector in 2011, we are developing knowledge and skills that the rest of the world will need in the coming decade. Ireland is leading the way and showing that high wind levels are achievable which brings with it opportunities to advance Ireland’s strategies for economic renewal.”

Ireland currently has 1425MW of installed wind energy across the Republic, with over 1100MW contracted and 3900MW receiving grid connections in the next phase of Grid Connections, Gate 3. Outside of this there is more than 11GW of wind energy projects awaiting Grid connection showing the significant pipeline and opportunity to be harnessed.

“In the simplest terms, such are the opportunities ahead for us that we can export as much renewable energy as we use by 2020. If generation capacity is met, we could export up to 5,000 MW of renewable energy generation in ten years, which will be more or less what we will require ourselves. These resources could generate an annual export value of over €2 billion for Ireland,” he says.