I am delighted to welcome you here this morning to the launch of the report of the Ministerial Task Force on Bioenergy.
The development of Ireland’s bioenergy sector is part of a comprehensive strategy to increase deployment of renewable energy across the three energy sectors: transport, heat and electricity. If we are to achieve a more sustainable energy future for Ireland it is imperative that we develop ambitious renewable energy and more energy efficient policies across all three sectors, because they are almost equal in the amount of energy they use
The development of our Bioenergy resources is a challenge which spans the area of responsibility of several government departments. Equally, it has potential benefits across a variety of areas. That is why we established a Ministerial task Force last July which involves seven different departments and their respective agencies.
In addressing bioenergy policy though an inter-Departmental and Ministerial forum, we are ensuring a whole of Government approach to delivering several key policy objectives.
In addition to diversifying fuel sources we are developing an indigenous energy sector and thereby reducing our dependency on imports. We are also maximising the benefit to rural economies by providing new development opportunities. We are providing new sources of energy for consumers and business, that will typically be cheaper than traditional fossil fuels.
Importantly in current circumstances the development of our renewable energy resources plays a key role in improving our overall environmental performance.
Bioenergy is a continuous and predictable clean energy source that has significant potential for electricity generation in Ireland.
As an energy source, biomass is somewhat unique - it can provide energy across all three energy sectors: electricity, heat and transport. The Plan sets out ambitious targets and deployment strategies in each of these sectors.
Renewable electricity has traditionally been the area in which most Governments have targeted extensive support mechanisms. Ireland is no exception and we are performing well in this area.
We have recently doubled our renewable electricity capacity. We are on track to exceed our EU target of 13.2% by 2010 and so I have recently increased this target to 15% and I am confirming the even more ambitious target of 33% by 2020.
As we move towards the 2020 target, biomass will be increasingly important. To this end, we have set targets for co-firing of biomass in peat stations. Electricity from anaerobic digestion will also feature increasingly in the future renewable energy mix. To achieve these ambitions the Renewable Electricity Feed-in-Tariff announced last year, provides for significantly higher index-linked contracts for biomass electricity.
While this programme currently applies to new-build electricity generation at present, I intend changing the programme to allow biomass-co-firing in existing power stations to avail of these tariffs also.
The development of a market for biomass electricity feedstock also provides significant opportunities for farmers, foresters and other agricultural businesses. Working with my colleague, the Minister for Agriculture and Food, we are now providing incentives for farmers and foresters to plant and process energy crops through establishment grants, forest machinery grants an increase in the EU energy crop premium.
The provision of these agricultural incentives is part of our policy to develop the entire supply chain, from producer to energy end-user. The schemes introduced by the Department of Agriculture and Food will also incentivise energy crop production for the renewable heat and transport fuels sectors. In these sectors we are also making strong progress.
In the last two years, I have introduced grants programmes valued at €89m to develop Ireland’s renewable heat sector. This is a marked success story. The most popular of the programmes I have introduced is the €47m “Greener Homes” domestic grants programme.
I have been singularly impressed with the public response to this programme - over 13,000 applications have been received the scheme commenced last March. Wood pellet stoves and boilers represent almost 50% of all applications. The enthusiasm with which the public have greeted these programmes, reflects a strong public appetite for change to cheaper, cleaner energy.
Following the launch of the Greener Homes scheme, in July, I launched a €26m “Bioheat” programme for the commercial sector, and an €11m “Combined Heat and Power” programme. These schemes provide grants of up to 30% for the installation of wood pellet and chip heating systems and energy efficient electricity and heat generating technologies. In the case of combined heat and power, I will shortly launch a specific Biomass-fed scheme under that programme.
Like the Greener Homes programme, the response to the commercial programmes has been very encouraging and we have responded rapidly to feedback from the schemes. In Budget 2007, the Greener Homes funding was almost doubled, and we announced the expansion ofthe “bioheat” programme so that community and voluntary groups could also apply for funding.
This is an important change which recognises the valuable contribution that such groups make to our society, often working on very tight budgets. By providing capital investment grants to this sector, we are facilitating access to significantly cheaper forms of energy. We are also working with the Department of Education and Science to provide access to funds and energy efficiency management tools for schools.
The Bioenergy Action Plan envisages a strong role for the public sector in developing a sustainable energy economy. It must lead by example by ensuring that renewable heating and energy efficiency will be a key feature in larger public buildings.
These measures will be underpinned by a renewed emphasis on installer training and product standards to ensure the development of a reliable and efficient supply chain for renewable technologies.
While there are no EU Directives or targets at present, governing the renewable heat sector, we are forging ahead with an ambitious deployment programme and setting clear targets for development. I have established targets of 5% in 2010 and 12% in 2020 for renewable heat deployment in addition to the co firing target. This will allow us to maximise the potential from forest, farm and waste resources.
In the transport sector again very demanding targets have been set, of 5.75% market penetration in 2009 and 10% market penetration by 2020. Ireland, like many EU Member States, had very little biofuels production until recent years. In 2005 and 2006, I introduced two excise relief schemes valued at almost €220m to incentivise the development of a number of biofuel projects.
This Minister for Finance simultaneously introduced a 50% VRT relief on flexible fuel vehicles. The decision by the Minister for Finance and the Minister for Environment, Heritage and Local Government to consider a review of motor tax and VRT rates to take account of CO2 emissions is a welcome further initiative.
The biofuels excise relief schemes are already resulting in the mainstreaming of biofuels in the regular petrol and diesel fuel chain. Already several filling stations are providing petrol and diesel which contain a percentage of biofuels. Other producers are developing niche markets for higher blend biofuels.
The schemes have provided a platform for the development of new and innovative projects and for a range of discussion and consultations on biofuels policy going forward. I have now announced a move to a biofuels obligation from 2009.
Under this scheme, fuel producers will be required to ensure that biofuels represent a certain percentage of their annual fuels. With targets as high as 5.75% and 10%, the obligation will provide enhanced opportunities for farmers to contribute to this emerging market. The obligation will also give all market players the necessary long-term certainty to make appropriate investment decisions.
The new policies will impact on a wide range of groups and sectors. In addition meeting environmental objectives we are providing new opportunities for rural communities, and there will be positive impacts in the economics of waste management. Consumers and business are also benefiting from access to cheaper energy.
The Bioenergy Action Plan is only one element of a comprehensive renewable energy policy and a broader national energy policy which will very shortly be published in the forthcoming White Paper on Energy.
There have been a number of other notable developments in the area renewable and sustainable energy policy.
In 2006, I launched a €10m “Power of One” energy efficiency campaign. The campaign has been immensely popular with the “Power of One” slogan itself becoming a household name. The energy efficiency message has been brought to households and businesses all over Ireland through a comprehensive advertising and publicity campaign. Coupled with the good-will generated through schemes such as “Greener Homes”, I believe we are making an important impact on consumer behaviour and attitudes.
Looking to the longer term, we are investing heavily in energy research. In 2006, we established an Energy Research Council. The Council will provide advice on development of policy for energy research, research priorities to 2013 and on integrating research policy with policies for the transport, environment, agriculture, enterprise, science and education sectors.
In addition to this initiative we also established the Charles Parsons Awards. Under these awards, €20m has already been allocated to seven Universities on the island of Ireland who are pioneering energy research and in particular renewable energy research.
Applying research to developments which have relevant economic and environmental potential is a cornerstone of our research policy. For example we are delivering an Ocean Energy strategy which will put Ireland at the forefront of ocean energy development and position us to capitalise on our unique ocean energy resource. Two wave energy prototypes are currently being tested at a specially selected site off the Galway coast while other devices are at earlier stages of development in the recently up-scaled wave testing tanks in UCC.
The measures contained in this Bioenergy Action Plan combined with the 2020 targets which we are introducing today will ensure that we develop a more sustainable energy future for Ireland.
Ends