Thank you Chairman
I am delighted to be able to join Eirgrid here today in the launch of the Eirgrid Gridlink project.
While we are here to launch a major infrastructural project, it does no harm to highlight the overall economic context and how energy infrastructural development fits into the bigger picture.
We all know that these are very difficult economic times for Ireland. We need to create the conditions for sustainable growth in our economies, for employment generation and for our citizens, enterprise and investors to have lasting confidence. The first priority of the Government is to secure Ireland’s recovery and to ensure employment for our people.
Energy policy has a pivotal role to play in creating the conditions for an economic recovery and for the job creation we need. Energy plays a key role in modern society. We all require access to an affordable and dependable energy supply. The businesses that sell goods and services and provide quality employment need a reliable energy supply that enables them compete. Ensuring secure reliable and safe supplies of electricity, gas and indeed oil will be critical to Ireland’s ability to attract inward investment and retain and create jobs.
I believe that Ireland, as a peripheral island energy market, can benefit from the transformation to a low carbon economy. This economy will be based around radically increased energy efficiency, accelerated deployment of renewable energy, smart networks and a well functioning, well interconnected internal energy market. This kind of energy system will enable us to have a more secure and competitive supply in the long term, and one in which our citizens, enterprise and investors can have lasting confidence.
Improving security of energy supply is a complex matter with solutions implemented over the long term, not overnight. It is a collective endeavour involving the energy sector, Government, the Regulator, enterprise, consumers and increasingly, communities themselves. Everyone has a role in delivering the best energy solutions for this country which ensure security of supply, reduce our dependence on imported fossil fuels, de-carbonise the economy, minimise costs for all consumers and contribute to overall competitiveness.
The energy security challenge is growing in Europe, with oil and conventional gas reserves in the EU geographical area declining. Member states are becoming more dependent on imports from relatively unstable parts of the world. It is also notable that the cost of fossil fuels is still very high.
One of the building blocks needed for a more secure and competitive energy supply is investment in new energy infrastructure as quickly as possible, in both Europe and Ireland. Investment in the national networks will underpin economic development, as well as renewable energy. Investment in interconnection and smart grids will critically underpin the single European energy market. As well as enhancing security of supply, such investment can ultimately enable trade in renewable energy.
There are, of course, difficult challenges to deal with to ensure infrastructure projects can build out in reasonable timeframes.
In national terms, the ongoing roll out of the Grid 25 programme, together with delivery of the essential North South transmission reinforcements and the completion of the East West Interconnector are vital for Ireland’s access to a secure and competitive energy supply. Given the scale of the necessary build out required, issues that could compromise the scale or pace of development necessary are clearly matters of concern for the Government.
While maintaining a viable and effective market, we need to ensure that new projects can develop into the future. To do this we need to see critical infrastructure built out. The focus now must be firmly on delivery and, in particular, the delivery of our vital energy infrastructure projects to underpin our collective security of supply. This is in the long term best interests of every citizen of this country and this is one of the key messages that I would like to highlight here today.
Development of the high voltage electricity grid as planned in the GRID25 strategy is critical to our long term economic recovery. Some have argued that the severe step down in economic activity ought to result in pulling back investment in this area. It is true that the contraction of the economy has been dramatic but it is also true that infrastructure investments are long term investments by nature, are projects that can take as much as a decade to deliver but in turn deliver benefits to us for decades thereafter.
Investment decisions for the necessary trans-European infrastructure up to 2030 must be taken now, as a significant amount of older generation plant will need to be replaced and more interconnected transmission systems need to be developed.
Energy infrastructure development is a long term task, involving the commitment and deployment of expert resources over many years. If the work is not planned and started in good time, and rolled out to meet these long term deadlines, the end result is slower project delivery and ultimately that future generations’ energy security is compromised.
Turning to our launch today, EirGrid’s Grid25 national programme, and specifically the Grid Link project being launched today, are vital for future socio-economic progress in Ireland.
The Grid Link Project is a key initiative under EirGrid’s Grid25 transmission development strategy. Without this project, the grid in the south and east of Ireland would not be sufficient to meet the region’s future electricity needs. The project will facilitate both conventional generation and renewable energy projects; reinforce the grid in Leinster and Munster; and support future interconnection with grids outside of Ireland. It is a significant upgrade of the electricity grid across the south and east and is the largest project under the Grid25 programme.
The Grid Link Project will help enable a secure supply of electricity for the region well into the future. It will empower growth in the south and east of Ireland and involve an estimated €500 million euro investment. It will also enable Ireland to meet its 40% renewable target and reduce our reliance on imported fossil fuels.
I think it is worth mentioning that the Grid Link project is included in the second Ten Year Network Development Plan (TYNDP) for Europe’s transmissions systems, recently launched for consultation by the European Grid Operators organisation, ENTSO-E. Its development is a requirement of the EU’s Third Energy Package, whereby ENTSO-E is required to adopt a non-binding Community-wide 10 year network development plan every two years. EirGrid is the Irish member of that organisation, as Ireland’s transmission system operator.
The purpose of the Plan is to assess the adequacy of the grid on a Europe wide scale, identify bottlenecks and, on this basis, highlight areas where investment is required.
The Plan identifies the need to invest over €100 billion in the refurbishment or construction of approximately 51,500 km of extra high voltage power circuits in Europe. Included are more than 100 projects of European significance, including a number of projects on this island. These projects demonstrate how European grid operators plan the transmission infrastructure to support the fundamentals of EU energy policy – market integration, the integration of renewable energy sources and security of supply. These are shared fundamentals across all Member States.
80% of the projects are related to the direct or indirect integration of renewable energy sources, such as wind and solar power. Gridlink is included in a group of projects under this heading of connecting and transporting renewable energy, specifically wind.
I am aware that this second Plan is still currently the subject of a public consultation on a European basis. It is worth noting that there is dedicated website for stakeholders to respond to in relation to this European Network Development Plan.
This brings me to the subject of public participation in relation to Eirgrid transmission system projects here in Ireland. I am aware that EirGrid is committed to public consultation and today they are launching a comprehensive process which will involve opening regional information centres. The company will take on board information and views in relation to the Grid Link Project which is at a very early stage. I would encourage members of the public and stakeholders to participate in that process, as such participation makes for better project implementation overall.
In conclusion, I am keenly aware of the opportunities, and also the ongoing challenges, for Ireland, as an island based energy system with significant renewable resources, as we seek to ensure a more secure energy supply. Transmission networks are a key part of that. Today sees a start on a key project that will provide greater security in electricity supply in the South and East, ensure future demand in the region can be met and thereby underpin its economic development.
The Government wants to be able to give a strong consistent message to Irish business and multinationals, and our citizens, that Ireland’s electricity networks are robust, modern and safe. That requires the investment programmes of EirGrid and ESB Networks to stay on course. This project is part of EirGrid’s programme. So its launch here today is a practical illustration of our collective and continuing commitment to large scale investment in electricity infrastructure.