Irish BioEnergy Association (IrBEA)
11th National BioEnergy Conference
Louis Fitzgerald Hotel, Newlands Cross
09.00AM, Thursday 16 February 2012
I would like to thank Tom and the Irish BioEnergy Association for inviting me here today to open your conference and launch its report on The Economic Benefits of the Development of Bioenergy in Ireland.
These are challenging times worldwide and the ongoing the economic turmoil and geo-political uncertainty only underline further the reliance we have in this country on imported fossil fuels and the exposure that we have to potential supply-side shocks. This dependency underlines the immediate and long term imperatives of enhancing energy security, reducing price volatility and ensuring energy sustainability at competitive prices for both individuals and businesses.
In light of these uncertainties the 2007 Energy White Paper is currently under review and a new energy policy framework will be published next year. The new 2012-2030 framework will fundamentally review the entire energy sector including renewable energy and will be published later this year.
Renewable energy is playing a key role in shaping Ireland’s long term energy future and is critical to delivering the policy goals of secure, clean and affordable energy supplies.
The Government is fully committed to delivering national energy efficiency and renewable energy objectives which are aimed at mitigating the economy’s reliance on imported, carbon intensive fossil fuels.
Allied to these macro imperatives for developing the renewable sector, the 2009 Renewable Energy Directive has set very ambitious renewable energy targets with the objective of achieving 20% of all energy in the EU to be from renewable sources by 2020. Ireland’s target was set at 16% of all energy consumption to be from renewable sources by 2020.
Our National Renewable Energy Action Plan, published in July 2010, sets out in detail how we intend to achieve our overall target. The target will be achieved through 10% of energy consumption in transport being from renewable sources, 12% of energy consumption in the heat sector and around 40% of energy consumption in the electricity sector coming from renewable sources.
While we have seen good progress in the last few years, particularly in relation to electricity going from 5% renewable electricity in 2005 to around 15% now, we still have a long way to go to reach our 2020 target of 40%.
And whilst wind , at 1,900MW has to date been by far the most significant source of renewable electricity and indeed is expected to contribute significantly more in the coming years the Government recognises that given its nature wind cannot deliver all of Ireland’s renewable electricity.
Meeting our targets will require us and to look at exploiting all of the sources of renewable energy available to us. Energy from biomass has certain advantages in that it can be called on when required. The heat generated can be also utilised for a useful purposes and can be counted against our renewable heat targets.
A vibrant bioenergy sector can, in an Irish context, contribute to the three pillars of European energy policy: security of supply, competitiveness and sustainability. A successful sector can also generate jobs, contribute to rural development and have positive environmental impacts through lower green house gas emissions.
Ireland has exceptional natural advantages with regard to bioenergy. We have a suitable climate for forestry and for growing energy crops, so we can be entirely cost competitive with other markets. We also have a large amount of agricultural land available for new forests or conversion to energy crops. Moreover, Anaerobic Digesters can help us deal with wastes, while at the same providing energy and rendering the waste into an easily used fertiliser. This technology can therefore help existing agricultural businesses to remain competitive while also helping to meet our renewable energy targets and help deliver on various water quality targets.
Exciting opportunities in sectors such as agriculture and forestry are already opening up as a consequence of existing measures and the number of biomass Combined Heat and Power Plants which are now emerging all over the country will mean a requirement for large amounts of feedstock such as wood biomass and energy crops.
I welcome this new report by IrBEA which adds to the knowledge-base of the sector. There can be a tendency to verge towards hyperbole when promoting new or emerging sectors but this report by taking a conservative approach to its analysis is all the more persuasive.
It highlights that the benefits to Ireland from the development of the bioenergy sector are very real. It estimates that around 3,600 permanent jobs can be created mainly in rural areas with 8,300 work years available during construction of new plants. It highlights that we currently import approximately 6 billion euro worth of fossil fuels per annum. The report estimates that a proportion of these imports can be replaced by indigenous biomass and biofuels thus saving on our balance of payments by up to 7.5%.
Bringing about the development of a sustainable, viable bioenergy sector in Ireland will not be an easy task and many challenges must be overcome. The amount of land area covered by trees is only around 10% which is the lowest rate of afforestation in Europe. If we are to realise our potential we will need to mobilise biomass from all available sources.
My Department is working with stakeholders including the Department of Agriculture to draft a Bioenergy strategy which I will publish later this year to set out how to optimise the development of a sustainable Bioenergy sector that can contribute to the meeting of our renewable energy requirements in transport, electricity and heating. In this regard the views of this sector and the findings in this report will be of great benefit in my Department’s deliberations.
More immediately I will next week be opening the REFIT 3 biomass scheme which will offer support tariffs for 310MW of electricity generation and will assist in the development of a sustainable biomass supply sector in Ireland. These supports will ensure that there is a ready demand for biomass and will build on measures such as the Afforestation and Energy Crop grant schemes run by the Department of Agriculture, Food and the Marine.
For the first time, Combined Heat and Power technologies are being supported. This means that, as well as contributing to the targets for renewable electricity, the CHP projects supported under the scheme will have the added benefit of contributing to the renewable heat targets including the potential to be utilised for district heating programmes or manufacturing.
The co-firing of biomass in the three peat fired power stations at Edenderry, West Offaly and Lough Ree, will also be supported. This could create a demand of approximately 900,000 tonnes of biomass per annum which should give incentive to foresters to grow new forests or to extend existing forests. Material previously regarded as waste, such as thinnings and sawdust can be used as biomass fuel - adding value to forestry. For farmers, there is now a realistic option to diversify into energy crops, such as willow, which can assist in providing a stable income for a number of years.
Anaerobic Digestion is also being supported under REFIT3. It offers a realistic means of dealing with certain wastes from agriculture, industry and the household while at the same time producing energy in the form of biogas. Biogas is used most commonly to produce electricity and heat on site, but it may also in the future be injected into the natural gas network or used as a fuel in the transport sector.
The scheme will, by paying a premium for electricity from energy crops, critically underpin the energy crops grant programme operated by the Department of Agriculture, Fisheries and Food and the development of Anaerobic Digestion will in particular assist in usefully disposing of agricultural waste products. The private forestry sector will also benefit significantly as the co-firing project will present a new market for their product.
The design of the scheme recognises the cross-sectoral relationships and dependencies and my Department consulted with the Department of Agriculture, SEAI and Teagasc in agreeing the nature of the support and arriving at the most cost effective means of delivering on our strategic goals.
The draft terms and conditions have been on my Department’s website for the past fortnight and will be open for feedback and requests for clarification until the end of the week. My Department is currently taking the feedback and questions received from you to date into consideration and based on this it is putting the final touches to the scheme and I will be opening the scheme for applications immediately thereafter.
The state also has an obligation under the Directive to increase the renewable energy content in transportation fuel. The Biofuel Obligation Scheme, which was introduced in 2010, currently requires all transport fuel suppliers in the State to include 4% biofuel in their overall annual fuel sales. This has created an annual requirement for approximately 220 million litres of biofuel in Ireland. This requirement will increase to 500 million litres as the obligation is ramped up to 10% by 2020 and will provide opportunities for sustainable indigenous production of biofuels.
These are challenging, unprecedented times. I believe that it is fundamental to economic recovery and well being to ensure that we have as much indigenously produced sustainable energy as possible available to us. By doing so we not only improve our balance of payments position, and reduce economic exposure to volatile global fuel prices but we reduce our overall level carbon emissions.
We all have 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 and contribute to overall competitiveness.
I again thank you for the opportunity to speak to you all and look forward to hearing your views.